The U.S. supply chain has been under pressure since the 2020 COVID-19 pandemic. The Global Supply Chain Pressure Index, provided by the Federal Reserve Bank of New York, exemplifies this trend in pressure. Recently, we’ve seen a downward trend in stressors on the supply chain, but some challenges remain. Changes made to alleviate pain points, such as automation in warehousing and procurement, a growing partnership with India has resulted in less reliance on China, and a focus on regionalization (manufacturing closer to where products are sold) have proven to be beneficial steps. Along with these changes, the U.S. is shifting its focus toward investing in the supply chain infrastructure itself.
Notably, a focus on the “Soo Locks,” which currently comprises two locks named Poe and MacArthur that connect Lake Superior to Lakes Huron, Michigan, Erie, and Ontario. An estimated 49.9 tons of cargo is transported through the Soo Locks from across Lake Superior, including 90% of America’s iron ore, which makes the functionality of the Soo Locks a pivotal part of the U.S. supply chain.
MacArthur, built in 1943, and Poe, built in 1896, have had regular outages over recent years due to the need for repairs. 1.6 billion has now been allocated towards sustainable repairs on these two locks, as well as the addition of a functional third lock. 44% of that 1.6 billion was provided by the Biden administration, which they were able to procure from a 1 trillion infrastructure law that was passed back in late 2021. However, due to a miscalculation in cost, additional funding will need to be acquired to finish the Soo Locks project.
U.S. Rep. Jack Bergman stated, “In addition to inflation and the rising costs of everything from tools and equipment to personnel, the Army Corps made miscalculations in the original cost estimates — making the total cost of the project far higher than originally thought.” The current allocation allows the project to run through the 2025 fiscal year. As the importance of the project is being stressed in Washington to ensure supply chain stability, representatives are confident that the remaining funding will be provided in due time.
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