| <No.742> |
| Tariffs Take Toll on Farm Equipment Manufacturers |
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Their iconic blue-colored equipment is recognizable on many farms across the country.
"We're known for our planters and grain cars."
Products easily spotted in large displays in front of Kinze's manufacturing hub along Interstate 80 in Williamsburg, Iowa, where the company employs over 500 people, most of them working with one key component.
"Steels are obviously the lifeblood of Kinze.
We're a factory that's essentially a weld house.
We cut, burn, shape, form, paint steel."
Steel which now costs more - result of a 25 percent tariff on the material imported from most countries.
"When there is a tariff on steel, it cuts right to the core of our fundamental product construction."
President Donald Trump imposed the tariffs with the goal of boosting U.S. steel production and related employment.
While there has been a modest benefit to the domestic steel industry, Dix says increased costs are negatively impacting companies like Kinze.
"And those tariffs take their effect on our cost structure, on our profitability for the family, through our employees, and now to our dealers and on to our final customers."
Those customers are mostly U.S. farmers who use Kinze's products to plant soybean seeds.
Soybean exports are now subject to retaliatory tariffs, which have sunk prices and contributed to another year of overall declining income for U.S. farmers.
That means many are less likely to purchase the products Kinze makes.
"The market is substantially down.
We get a one-two punch.
We pay more for the product that comes into us and therefore on to the customer, and then we have a reciprocal situation where we can't export what was advantageous to us."
Dix says one year under tariffs has already taken a toll on Kinze's operations.
Kane Farabaugh, VOA News, Williamsburg, Iowa
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