Industry Faces Challenges, But Bright Spots Exist

Steve W. Sloan, president and CEO of Midwest Minerals Inc., Pittsburg, Kan., was elected the 2008 chairman of the board of the National Stone, Sand and Gravel Association (NSSGA). His election came during the NSSGA Board of Directors’ meeting at the association’s annual convention in March.

Sloan has been an active member of NSSGA since 2003, serving on the Safety and Health Committee, Board of Directors and as vice chairman of the association. He has chaired the Kansas Aggregate Producers Association and has been active on many other boards and organizations.

NSSGA is the world’s largest mining association by product volume. Its member companies represent more than 90 percent of the crushed stone and 70 percent of the sand and gravel produced annually in the U.S. and approximately 118,000 working men and women in the aggregates industry.

Sloan answered questions about his role as chairman and what he sees as the biggest challenges the industry faces in the coming years.

Question: What are your goals as NSSGA chairman?
Answer: Keeping the association strong and growing and focused on the priorities established by the Board of Directors. It is the association’s job to make sure that aggregates producers all over America exist in an environment that allows them to provide the public with the basic materials needed for growth and progress. I hope 2008 will be a year of ever-increasing safety performance for our workforce; a stronger, safer industry will be more sustainable in the future.

Q: The overall economy has made it tough on producers. What are you hearing from them?
A: I think all industries are feeling the strain of a weakened economy, not just ours. But we’ve been through this before and we’ll survive and come out the other side even stronger. Unlike companies that do business overseas, we are truly local businesses, even those owned by national corporations. The downside is that we suffer alone in our communities, reacting to the ebbs and flows of the local economies, so most of the members of the association are being uniquely impacted. On the upside, we look forward to being a big part of the recovery in those same communities.

In parts of the West and Southwest, construction of all sorts continues at a healthy pace. In the East and Northeast, not so much at the moment. Typically, our industry lags behind other sectors, so as the economy recovers over the next couple of years—as most economists predict it will—some aggregates producers may be slightly behind the curve, but things will get better for all sectors of the economy.

Q: What are the bright spots in the industry?
A:  Congress is addressing the looming deficiency in the federal Highway Trust Fund to ensure its solvency until the reauthorization of the national surface transportation program due next year. When Congress acts, it means states will continue to be able to let contracts on highway and bridge construction within the federal Interstate Highway System.

At this point, it seems to be generally accepted that prospects for reauthorization of the SAFETEA-LU transportation program are better than they were in 2003, the deadline for the last reauthorization. That took until 2005 to pass. Congress and the public seem to be more focused on the serious maintenance problems that plague the federal surface transportation system and the need for new construction than they were in 2003.

Also, while new home construction has fallen to record lows in many parts of the country, other construction—public works and commercial projects, for example—may have slowed, but still requires continuous supplies of aggregates.

Q: What do you see as the major challenges facing the industry in the next five to 10 years?
A: The challenges NSSGA faces include substantially higher stakes posed by federal legislation such as the Ban Asbestos in America Act—in which assuring accuracy in minerals definition is crucial; the S-MINER and wetlands bills; in addition to gearing up as part of the coalition effort for transportation reauthorization.

Challenges also vary in intensity. Among the challenges are the needs to keep the nation continuously supplied with high-quality aggregates to support our infrastructure, to ensure that the safety and health of our workers are not jeopardized, to maintain an environment in the country in which aggregates can be produced without undue regulatory or legal restrictions, and to preserve our social license to operate.

Members of NSSGA have a good story to tell the American people about the aggregates industry. Crushed stone, sand and gravel truly are the basic materials in practically everything that makes modern life possible and enjoyable. From the streets, roads, sidewalks, homes and buildings in each community to the toothpaste, cleansers, baby powder and computer chips that we use every day, aggregates products make a vital, positive contribution to our way of life.

However, few people actually stop to think about the importance of aggregates to their daily lives.  Most do not relate a nearby quarry or sand and gravel operation to the safe roads and bridges they drive on or to the strong buildings and sturdy houses they work and live in.  Many people in communities where aggregate producers operate do not have a clear picture of the economic, environmental and societal benefits associated with those operations.

Q:  Sustainability is a big topic in the industry right now. How is the NSSGA addressing that issue?
A:  NSSGA members identify sustainability as a strategic business approach that integrates the concepts of environmental stewardship, social responsibility and economic prosperity to ensure the long-term supply of aggregates materials to the communities in which we operate. Sustainability is not a catchword any longer. It really is a value and, in fact, NSSGA’s Board of Directors made it a guiding principle for NSSGA members.  Sustainability means that we care about people, we care about our environment and we care about making products that help build American’s economy. And, it is that principle which will guide us through the 21st century.
We have the responsibility to protect the health and welfare of mothers, fathers, sons and daughters of our workforce, who are the very community that gives us the right to operate our businesses in their neighborhood.

We have the responsibility to be effective stewards of the land we develop and, ultimately, return to the community properties that have a second life as recreational areas, residential housing, wildlife habitat, and more.

We have the responsibility to provide adequate supplies of aggregate materials to our communities to build sound infrastructure to maintain a high quality of life, providing such necessities as safe roads, sturdy houses and strong bridges.

Finally, we recognize that sustainable practices are necessary today to preserve the potential for an even better quality of life for future generations.
We believe that sustainable practices are good business and good for business.

Q: You have named safety as a top priority for the NSSGA this year. How will that issue be addressed?
A: I believe safety is the most important aspect of our industry. If our employees don’t return home safely each and every day, then we’ve failed. And in the words of the Apollo 13 flight director, “Failure is not an option.” 

I can speak for our company, and I can speak for every NSSGA member company that I’ve visited, in telling you that safety is priority one. I encourage management at every level to emphasize safety in the workplace every day. If they do, it becomes a dominant factor of success in any company. That’s why we try to prioritize safety as the most important thing we do. An excellent safety record is a true measure of a company’s success, and we must recommit ourselves to safety every day of our lives.

We’ve initiated the Safety Pledge program this year that follows on from our previous efforts to have NSSGA member companies pledge to help reduce the industry wide MSHA injury incidence rate by 10 percent a year.

We continue to work directly with MSHA through the MSHA-NSSGA Alliance to find new ways of improving safety and reducing injuries. 

For more information about the National Stone, Sand and Gravel Association, go to www.nssga.org.

This material has been voluntarily provided by Steve W. Sloan.  Steve W. Sloan is not speaking on behalf of Caterpillar, and the views or opinions expressed in this material are those of Steve W. Sloan and may not represent the views of Caterpillar.