US crops rot as trade war raises storage costs
US farmers have a problem - where to put all the grain they cannot sell to Chinese buyers.
Louisiana farmer Richard Fontenot and his neighbours are even letting their crops rot.
Mr Fontenot ploughed under more than 400ha of his soybean crop, chopping plants into the dirt instead of harvesting more than US$300,000 (S$412,000) worth of beans.
His beans were damaged by bad weather. Normally, he could sell them anyway to international merchants who store grain. But this year they are fully stocked and not buying as much damaged grain.
"No one wants them," Mr Fontenot said in a telephone interview. As he spoke, he drove his tractor across a soybean field, destroying his crop. "I don't know what else to do."
Across the United States, grain farmers are doing the same. They are leaving crops to rot or piling harvests on the ground, hoping for better prices next year, according to interviews with more than two dozen farmers, researchers and farm lenders.
This is one of the results of a US trade war with China that has hurt export demand and swamped storage facilities.
In Louisiana, up to 15 per cent of the oilseed crop is being ploughed under or is too damaged to market, according to data analysed by Louisiana State University staff. Crops are going to waste in parts of Mississippi and Arkansas too.
But this has boosted revenues at grain storage company Andersons.
These are also boom times for grain storage bag retailer Neeralta, with sales up 30 per cent from a year ago. - REUTERS