Wheat Letter: Rail Merger Proposals Should Improve Competition, Hold Down Wheat Shipping Rates

On March 21, 2021, Canadian Pacific (CP) Railway announced a $25 billion plan to merge with Kansas City Southern (KCS), calling it a “transformative” remake of the freight-rail industry.

The proposed new railroad would be the first U.S.-Mexico-Canada-linked rail line.

Not to be out-done, Canadian National Railway (CN) began talks with KCS in late April, saying it could yield a “superior” rail merger proposal and offering $30 billion for KCS compared to CP’s $25 billion.

The U.S. wheat industry is closely watching both proposals but has not taken a position in support of or opposition to either proposed merger.

For the full story from today's Wheat Letter from U.S. Wheat Associates, click here.