WASHINGTON, July 19, 2017 — The United States needs to make more strategic, significant and predictable investments in the U.S. transportation infrastructure or risk having U.S. agriculture lose its competitive export advantage to foreign countries, the National Grain and Feed Association told Congress today.
“Over the last decade, I have witnessed an alarming decline in the historical competitive advantage that our transportation infrastructure has provided U.S. agriculture, and the corresponding increase in investment in critical infrastructure being made by our foreign competitors,” said Rick Calhoun, former president of Cargo Carriers, Cargill Inc.’s marine operations business unit, who testified on NGFA’s behalf at a hearing on rural infrastructure conducted by the House Agriculture Committee. “We welcome the critically needed renewed sense of urgency by this Congress and the Trump administration to enact an infrastructure package that includes a reliable funding mechanism to renovate our dilapidated inland waterways system, as well as to restore rural roads and bridges. Both are essential to the future vibrancy of rural communities and competitiveness of U.S. agriculture.”
Historically, the United States has been blessed with a transportation system where the four major modes of transportation – truck, rail, barge and ocean-going vessels – complement and to an extent compete with one another, noted Calhoun, who chaired NGFA’s Waterborne Commerce Committee. The U.S. inland waterways, which constitute the most economical, fuel efficient and environmentally friendly mode, are used to transport about two-thirds of the U.S. grains and oilseeds destined for export while U.S. ports help move more than 90 percent of those shipments. But the NGFA noted the United States is spending less on its transportation infrastructure – the lowest since World War II measured as a percentage of gross domestic product – while major foreign competitors are increasing theirs.
Calhoun said stronger federal investments in U.S. locks, dams and ports and would help chip away at the backlog of critical inland waterways projects that remain unfunded. Noting that the Harbor Maintenance Trust Fund currently has a $9 billion surplus, he said Congress also should direct those funds to be spent for their intended purpose – to maintain U.S. ports and harbors, including dredging activities.
The NGFA touted as a successful public-private partnership the 50 percent funding of inland waterway locks and dams already provided by commercial users of the system, including farmers, agribusinesses and the barge and towing industry. Since 1978, the federal government has assessed a barge diesel user fee on commercial users now set at 29 cents per gallon, which is deposited into the Inland Waterways Trust Fund (IWTF) and ostensibly matched by federal appropriations. The NGFA asked legislators to consider how other beneficiaries of the inland waterways system that do not pay, such as recreational users and hydropower and flood-control recipients, could contribute financially to its modernization without imposing counterproductive lockage fees and tolling on inland waterways, which have been rejected repeatedly on a bipartisan basis by Congress dating to the Clinton administration.
“Imposing additional costs on those utilizing commercial barge transportation – on top of the 50 percent cost-share that farmers and the private sector already pays into the IWTF – would risk diverting traffic from the most efficient mode of transportation available to U.S. agriculture, further congesting U.S. highways and resulting in higher rail freight rates ultimately paid by farmers,” Calhoun said.
Regarding rural bridges and roadways, the NGFA suggested that Congress explore prioritizing increases in federal funding, reclassifying rural roads and bridges to be eligible for funding, and developing a system of block grants so states and localities could prioritize road and bridge projects that they deem most important, with input from the agricultural sector and rural communities.
“The road to feeding a growing country and world population will be met by looking forward, not through the rear-view mirror,” Calhoun concluded. “Let’s not let just under $9 billion stand in the way of our ability to feed our country and the soon to be 9 billion people around the globe.”
The NGFA, established in 1896, consists of more than 1,050 grain, feed, processing, exporting and other grain-related companies that operate more than 7,000 facilities and handle more than 70 percent of all U.S. grains and oilseeds. Its membership includes grain elevators; feed and feed ingredient manufacturers; biofuels companies; grain and oilseed processors and millers; exporters; livestock and poultry integrators; and associated firms that provide goods and services to the nation’s grain, feed and processing industry. The NGFA also consists of 29 affiliated State and Regional Grain and Feed Associations, and has strategic alliances with Pet Food Institute and North American Export Grain Association.