Industry leaders in Missouri talk business (Part 2)
The following discussion, which was edited for brevity and clarity, took place during a roundtable of aggregate producers at the Missouri Limestone Producers Association’s 2022 Annual Convention. The roundtable involved three aggregate producers – Farmer Companies’ Kirk Farmer, Martin Marietta’s Ward Nye and Summit Materials’ Scott Anderson – with P&Q managing editor Jack Kopanski serving as moderator. Part 1 of this discussion can be found here.
Says Summit Materials’ Scott Anderson: “Inflation was kind of beating us out of the gate, and we were playing catchup. I feel like we’re catching up and we are going to see the benefits of that momentum into 2023.” Photo: Dan Kleinsorge
P&Q: What might 2023 look like if and when Infrastructure Investment & Jobs Act (IIJA) funds are disbursed on a wider scale?
KIRK FARMER (FARMER COMPANIES): Missouri’s had an about-face. The Department of Transportation (DOT) seems to be much more well-funded than the fear we’ve been living in over the past 20 years. I think the aggregate industry is going to hold up just fine in whatever recession we have. Other lines of business may not fare quite as well. I think ready-mix will go down, which is, I think, more tied to residential. In general, I think the aggregate business should be just fine.
WARD NYE (MARTIN MARIETTA): It’s interesting to look back at what this highway bill is going to mean. If we look at the increase in funding that comes with this, it’s the single-largest increase we’ve seen since [former President] Eisenhower signed the National Interstate [& Defense Highways] Act into law in the mid 1950s.
If we go back in history and look at the way those funds usually flow, I’m going to view [2023] as Year 1. While [IIJA] was signed [in] November [2021], I don’t think any of us were under any misapprehension that we were going to see much help from that [in 2022]. Probably about 20 percent of those funds start rolling through in a meaningful way [in 2023], [and] about 40 percent [should] start rolling through in a meaningful way in 2024. It’s going to be a nice, consistent build over a period of years.
SCOTT ANDERSON (SUMMIT MATERIALS): I’m excited about what’s going on with the public side. We’re going to see a step up in federal infrastructure in 2023. I think you get a layering effect and another step up in 2024. But behind that, the state DOTs [and] the state budgets are very healthy. It’s really setting the stage for the infrastructure we need in these communities. I’m excited about where we sit.
P&Q: How are you and your companies keeping safety top of mind these days?
FARMER: We made a decision as a family to put our money where our mouth was with safety. We take our losses. When somebody gets hurt, we pay for it. It became pretty important to us to keep our people safe, and I think we do a pretty good job at it. You have to incentivize employees to be safe, and you have to preach it every day. Sometimes you have to stop doing what you’re doing and just talk about safety.
NYE: Your most efficient way to find your way out of Martin Marietta is to violate one of two things: our code of professional business conduct or our safety rules. That’s your quickest way out of the company. We don’t do that as a stick; we do that because we have a guardian angel program that says we’re going to take care of each other in the workplace. What does that mean at the end of the day? It means we’re driving toward changing people’s behaviors.
The other thing we’re doing is having people give safety observations in quarries. I’ve gotten phone calls in my office and somebody says: ‘I’ve got a safety observation for you.’ I think that’s one of the greatest calls I can ever get. The fact is this is something that is a value for us. We make it a big deal, we talk about it publicly, we talk about it privately in the operations [and] there’s not a meeting that starts in our company that doesn’t begin with safety first – and that includes a board of directors meeting.
ANDERSON: Safety is a core value for us. There’s not a meeting that starts without starting with safety. We start with a safety share, and that really sets the tone We want to keep safety top of mind. We’ve got a number of programs on safety – and we’re measuring everything. We’re really trying to drive it down to the frontline.
When you look at our metrics, our recordable rate from last year (2021) has dropped 50 percent. So, I know we’re making an impact. We’re really trying to empower that frontline guy to raise his hand and say: ‘This not safe.’ We also want to make sure we have a culture where guys are empowered to do that right on the frontlines.
P&Q: Where do you think the aggregate industry as a whole is from a safety standpoint, given where fatalities are at?
ANDERSON: I think the turnover is probably making an impact. There’s no doubt the data suggests that your less-seasoned employees [and] your new employees are subject to more risk. It’s a responsibility that we need to take on. It’s important to have a really strong new hire training program and make sure [safety] isn’t just sitting in front of a video for a few hours. We must have hands on training – task training, equipment training, risk assessments and thoughtful training for our new hires.
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