Freight trends remain sloppy, while soybean farmers are getting crushed

Trend watch

On slide 7, we show an estimate for weekly jobless claims, which aren’t being released by the Department of Labor during the government shutdown. However, all 50 states continue to collect their respective data, which many publicly release, and the estimate is a tabulation by financial data firm Macrobond based on those reports.

As a reminder, on slides 3, 4, and 5, we’ve marked the impacted indicators in red and are changing the trend to “Ø” once a data release has been missed since a stale trend shouldn’t be relied upon.

Note: Slides are available to clients in the full report. 

Our take

U.S. freight volumes, which we show on slide 8, have continued the surge and plunge pattern that has plagued this past year. These swings are related to companies attempting to sidestep tariffs on both production inputs and external orders.

Additionally, some firms are both accelerating orders and shipments ahead of new tariffs or halting purchases once those tariffs take effect. That dynamic has been exacerbated by the on-again/off-again nature of the tariffs, including retaliation by other countries as well as public announcements and threats.

China is the poster child of this back-and-forth interplay, although it has largely chosen non-tariff responses. For instance, China announced new stringent export rules for rare earth minerals, batteries, and high-tech components. It will also implement new port fees for all ships owned or operated by U.S. companies, which is a direct response to a similar action by the U.S. on Chinese-built and operated vessels.

Furthermore, China has completely stopped soybean purchases from the U.S. Soybeans rank as America’s top agricultural export in terms of value at nearly $25 billion in 2024, or 52.2 million metric tons.

Roughly half of the U.S. soybean crop is exported, with more than half – $12.6 billion – purchased by China. In other words, roughly one-third of the soybeans grown in America are sent to China.

That is coming at a critical time for soybean farmers. First, U.S. soybeans are typically harvested now – roughly from late September through November. Proceeds from the harvest are used to repay loans. Of course, China shutting down soybean purchases translates into prices falling.  Moreover, farmers are generally making planting decisions for next year’s crop now.

Alas, this is why the White House is talking about farm subsidies – otherwise known as a bailout. However, that would require an act of Congress, which is currently shutdown. Thus, U.S. soybean farmers are the ones who will potentially be crushed rather than the small round legumes.

Bottom line

The U.S. economy remains in a muddle-through environment. We’re hopeful that the modest reacceleration in job growth during the past two months will persist, supported by certainty in tax policy and further clarity on the tariffs. We expect the Fed to continue moving cautiously until there’s more evidence, which might be challenging to ascertain given the government-sourced economic data embargo.