(Newswire.net — February 18, 2022) —
The U.S. House of Representatives recently passed a $1.2 trillion infrastructure bill that was then signed into law by President Joe Biden on November 15. The bill has been widely praised and applauded by those in the steel, construction, and other associated industries. It’s crucial for these industries, who have struggled to keep up with demand after being forced to slow or shut down their plants and manufacturing facilities through the COVID-19 pandemic, to ramp back up again.
With an increase in demand for infrastructure projects as the pandemic looks to be rounding the final corner (hopefully), the steel industry has been racing to increase production and distribution back to pre-pandemic levels. The new Infrastructure Investment and Jobs Act will not only help fund this return of full-capacity production, but also provide new opportunities and growth possibilities for the steel industry as a whole.
What is the infrastructure bill?
The bill that we are discussing today is a bipartisan commitment to the infrastructure of our country. It totals around $1.2 trillion, which includes $550 billion in new spending to go towards the improvement and upgrading of projects from roads to electric transportation to water pipes. It’s important to note, however, that the $1.2 trillion Infrastructure Investment and Jobs Act that we are addressing here also has a companion bill, the $2.3 trillion Build Back Better Act. This focuses on social infrastructure and we will not be going through it, as it doesn’t have as large of an impact on the steel industry as the Infrastructure Investment and Jobs Act.
How much of it will support the steel industry?
Infrastructure can be a pretty broad term, so how much of the $1.2 trillion is actually going to be supporting and helping the steel industry? The bill isn’t directly going to the steel industry, it’s indirectly helping the industry and companies. This means that the money is going to businesses and plans that use steel, not directly funding the steel companies themselves. The best way to see how the bill supports the industry is to look at the major projects and initiatives in the bill that rely heavily on steel:
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$110 billion for roads, bridges, and major infrastructure projects
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This will go to construction and repair, as well as transportation research and “congestion relief” in American cities. It also includes $40 billion, specifically for bridge repair, replacement, and rehabilitation.
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$39 billion to modernize public transit
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This section will focus on repairing and upgrading existing public transit infrastructure nationwide. It will make transit more convenient and useful to seniors and disabled Americans through more accessible stations, transit service in new communities, and modernizing rail and bus fleets.
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$66 billion for passenger and freight rail
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The bill will fund upgrades to the country’s passenger rail system and freight rail safety, while expanding rail service beyond the northeast and mid-Atlantic regions.
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$17 billion to help ports
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Half of this budget is planned to go to the Army Corps of Engineers for port infrastructure, while the rest of the budget is allocated amongst the Coast Guard, ferry terminals improvements, and reducing emissions at ports.
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$25 billion for airports
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This section of the bill will not only allow for major expansions and upgrades to airports around the U.S. but also reduce repair and maintenance backlogs and congestion. It also includes $5 billion for air traffic control tower and systems upgrades.
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$7.5 billion for zero- and low-emission buses
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In conjunction with the public transit section, this will help fund the bus fleet replacement and upgrade, while supporting the goal of lower emissions near ports, schools, and more.
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$65 billion to rebuild the electrical power grid
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This will fund the building of thousands of miles of new power lines as well as further expanding renewable energy distribution across America.
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$55 billion to upgrade water infrastructure
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Upgrading the water infrastructure of the U.S. will include projects such as lead pipe replacement for access to clean drinking water, chemical cleanup, and more.
How does this affect the steel supply chain?
All of these spendings will require huge amounts of steel and account for nearly $400 billion of the bill. Through this breakdown, we can see that, while the money isn’t going directly from the government to the steel companies, it will drastically improve the demand for steel products commonly used in infrastructure. These include plates for bridge construction and rebar for new roads, as well as the steel required for rail and electrical tower upgrades.
By increasing the demand with guaranteed jobs and commitment to these projects, steel manufacturers and distributors are taking on less risk opening up and firing operations back up. With the struggles that the industry and supply chain have gone through over the course of the last couple of years, this stability and promise of support by the government and country are exactly what is needed to get back to work.
Modernizing U.S. infrastructure with steel
The Infrastructure Investment and Jobs Act is a significant step towards not only modernizing our country’s infrastructure, but also doing it with American-made steel. Providing more jobs and opportunities for growth domestically, it will help to improve America’s infrastructural quality and our economic competitiveness internationally.