Biden spends not so much on logistics infrastructure

Port freights rates and congestion

The United States Government has embarked on an apparently huge programme of infrastructure investment and logistics infrastructure is high on the list of targets for expenditure. It is now attempting to implement some of the ideas for investment.

American President Joe Biden’s fiscal policies may be controversial in the US, however, their implications for the logistics sector ought to be significant. Specifically focussing on marine transport Mr Biden’s government has announced a major initiative to support the expansion in ports and related land-side capabilities. In the words of a Whitehouse statement in November; “Recognizing the critical role American ports play in the global economy, President Biden’s Bipartisan Infrastructure Deal includes an unprecedented $17 billion to improve infrastructure at coastal ports, inland ports and waterways and land ports of entry along the border”.

Over the New Year, the US Department of Transport (DOT) issued what it calls the ‘Port Infrastructure Development Program’. This includes a string of investments at container ports with the largest being at Long Beach in California where $52m has been allocated to the ‘Early Rail Enhancements Project’ which is essentially the expansion of rail yard capacity. Also, there is $18m for the ‘Bayport Container Terminal Expansion’, which is an expansion of the container yard at Bayport in Texas and the building of a fourth Ro-Ro berth at the Port of Brunswick in Georgia, costed at $14.6m. In total there are around 25 projects already agreed upon, although most of these projects are smaller than those at Long Beach, Bayport and Brunswick in terms of the amount spent.

Overall, the Port Infrastructure Development Program is looking to spend $450m a year on infrastructure. This represents an increase in the sums spent, with the total to be spent over the next four years “roughly the same amount of federal funding provided to ports under DOT-administered grant programs since the DOT began providing funding to ports in 2009”.

That said, bearing in mind the huge size of the US logistics economy, $450m a year is not enormous. For example, the development of the Ro-Ro terminal at the port Brunswick, whilst useful, is dwarfed by the other expansion in rail, terminals and container handling at the Georgia ports complex. There are headlines about enormous US government expenditures, however, if the US is to improve its maritime logistics infrastructure alone it will need larger sums of money, sums which it seems will have to come, in great part, from the private sector. 

Source: Transport Intelligence, 13 January 2022

Author: Thomas Cullen

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