Canadian Pacific-Kansas City Southern rail deal seen boosting farm sales
Canadian Pacific’s $25 billion deal to buy Kansas City Southern will create a rail network from Canada to Mexico that farm groups say could smooth the flow of their goods to market
Reuters
The deal, subject to approval by the U.S. Surface Transportation Board, would combine CP’s cross-Canada network, which stretches as far south as Kansas City, Missouri, with its U.S. rival’s network, which extends south into Mexico.
Mike Steenhoek, executive director of the Iowa-based Soy Transportation Coalition said the deal could increase market access for customers of each railway.
“Many current Canadian Pacific customers currently only have access to export terminals in the Pacific Northwest,” Steenhoek said in a statement. “Similarly, current Kansas City Southern customers may enjoy new access to markets served by the Canadian Pacific network.”
Mexico is a major buyer of U.S. corn and Canadian canola.
“This will open up a whole new set of opportunities for grain shipments,” said an industry source close to the deal.
“Canadian grain handlers also see potential for enhanced sales, but are awaiting details on how much of a priority the combined company will place on customer service”
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