News

Ag Partners News

    Ag Partners Recognized as Founding Member of IAEP
    Ag Partners Recognized as Founding Member of IAEP
    Oct 15, 2018 |
    CEO, Troy Upah accepts IAEP award on behalf of Ag Partners, LLC.  
    Seed Daze
    Seed Daze
    Aug 29, 2018 |
    It’s all about seed. And the deals and discounts will never be this good. Take advantage during Seed Daze!
    Boost your Bean Yields
    Boost your Bean Yields
    May 25, 2018 |
    Consider the combination of Viathon and CoRoN for soybeans.   Viathon® is a broad-spectrum fungicide using three modes of action for cost-effective disease control. CoRoN® is a well-known, controlled-release foliar fertilizer that provides weeks of steady nutrition.
    Alceco approves $1.3 million to be revolved to members
    Alceco approves $1.3 million to be revolved to members
    Feb 20, 2018 |
    The Alceco board of Directors is pleased to authorize a cash revolvement of $1.3 million to its members.   This revolvement represents a payout in three categories: Class B Preferred Stock and Regional Equity to all patronage age 85 and over, 25 percent of Class B Preferred...

DTN News

Retailers,Shoppers to Feel Tariff Pain 05/23 06:15

5/23/2019 - 09:06:00

Retailers,Shoppers to Feel Tariff Pain 05/23 06:15

   NEW YORK (AP) -- An escalating trade war between the U.S. and China could 
mean higher prices on a broad array of products from toys to clothing. But some 
retailers will be less equipped to handle the pain than others, leaving 
consumers to carry the load.

   Analysts say big box giants like Target and Walmart who marked their latest 
quarter with strong performance are best positioned to absorb the higher costs 
because of their clout with suppliers. They're also taking a judicious approach 
to price increases to lessen the impact.

   The losers will be the ones that have been struggling all along --- the 
mall-based clothing stores and others that sell commoditized products like 
basic sweaters or that don't have the financial wherewithal to absorb extra 
costs.

   Consumers, as well as most retailers, had been left largely unscathed by the 
first several rounds of tariffs that the U.S. imposed on China because they 
mostly focused on industrial and agricultural products. But that began to 
change when items like furniture saw an increase in tariffs to 25% two weeks 
ago.

   Retailers will absorb the extra costs when those products arrive in U.S. 
ports in June. But now the Trump administration is preparing to extend the 25% 
tariffs to practically all Chinese imports not already hit with levies, 
including toys, shirts, household goods and sneakers.

   Cowen & Co. estimates shoppers could see as much as 10% to 15% in price 
increases across all goods imported from China, which would mean an incremental 
cost of $100 billion or more.

   Retail executives from a wide array of stores from Walmart to Kohl's said on 
conference calls with analysts this week  and last week that they remain 
optimistic about the financial health of the consumer, citing low unemployment 
and a strong economy. But shoppers could balk at paying higher prices on things 
they don't need, especially those in the lower income bracket who are sensitive 
to any cost increases.

   Analysts believe shoppers' habits will change if the trade wars escalate and 
the next round of hikes stay in place for a while.

   "It will change behaviors and change how much people buy and where people do 
that buying," said Neil Saunders, managing director of GlobalData Retail.

   Greg Petro, CEO of First Insight, a technology firm that advises retailers 
and brands on pricing decisions, believes that if prices do rise because of the 
new tariffs, they will be permanent but not all products will be hit the same 
way. For example, home decor is less sensitive to price increases than big 
furniture based on millions of data points his firm collects monthly. Women's 
clothing is more sensitive to price hikes than men's clothing. In children's 
shoes, which lost a big player Payless ShoeSource, retailers will have more 
power to increase prices since the shoe supply has gone down, he said.

   Meanwhile, UBS is offering a dire analysis of what the new tariffs could 
mean in terms of store closures. UBS was already forecasting that nearly 21,000 
stores in the U.S. would shutter by 2026, but with the next round of tariffs, 
more than 50% of those closures would occur within one year instead of four, it 
said.

   "We continue to think the apparel and footwear consumer's willingness to 
spend remains tepid at best," UBS retail analyst Jay Sole wrote in his report.

   In fact, nearly  200 footwear retailers and brands including Adidas and Shoe 
Carnival wrote a letter to President Donald Trump on Monday calling for him not 
to slap tariffs on footwear imported from China.

   The group, the Footwear Distributors and Retailers of America, estimates 
Trump's proposed actions will add $7 billion in additional costs for customers 
every year.

   Many retailers from Macy's to Walmart warned that even though the escalating 
trade wars would mean higher prices for shoppers, the situation is still fluid.

   Walmart said it's been closely working with suppliers and says it will look 
at price increases on a case by case basis. Target's CEO Brian Cornell said it 
will be able to weather the storm better than others because it sells a variety 
of items instead of focusing on a single product.

   "Our ability to flex our focus from category-to-category is something that's 
somewhat unique to Target versus single-category retailers," he told analysts 
Wednesday.

   Among department stores, the big concern is its private label clothing 
offerings, much of its sourced in China.

   T.J. Maxx parent, on the other hand, which sells top brands at discounts and 
has been a darling in the retail world, sees itself benefiting from other 
retailers' woes.

   "Disruptions in the marketplace have created off-price buying opportunities 
for us," Ernie Herrman, CEO of TJX Cos. told analysts earlier this week. 
"Further, because of our great values, if retail prices overall increase, that 
may create an opportunity for us to attract new customers."


(KA)

DTN Grain News

DTN Market Commentary