Competition from other grain-producing countries weigh on U.S. grain exports – and on U.S. rail volumes for grain.
The uncertainty over whether and when the U.S. and China will reach a trade agreement this year is creating a cloudy outlook for grain volumes this fall.
“We expect uncertainty to persist in the grain market due to the foreign tariffs,” said Kenny Rocker, Union Pacific (NYSE: UNP) executive vice president for marketing and sales.
China imposed a 25% import duty on US soybean imports in July and a domestic shortage of beans is now resulting in Chinese traders paying a higher price for Brazilian beans than what domestic crushers are paying, leading to speculation that China could again increase shipments from the US.
