Many people will tell you that you should extract trade only at your capital. Instead, it was better to just collect trade. However, if I directed trade downstream, it would have been collected by England or Norway, in The North Sea and London nodes between Chesapeake Bay and Antwerpen. I had a large number of colonies in the Chesapeake bay node. One good example of a situation where directing trade would be a bad idea occurred in my most recent game as Netherlands.
You don't direct trade through nodes where other players/AI have a lot more trade power than you, especially your enemies. Usually you will want to direct trade downstream, but not always. Should you always steer trade to your capital? NO! Instead, you should relocate your capital to a the node that is furthest downstream which you dominate, and then direct trade there. While it is possible to steer trade upstream, it is virtually useless to use a merchant to do so because the trade power penalty is severe. This is caused by Aragon steering trade toward Genoa. I get absolutely nothing from the Tunis trade node, because I have no merchant there. This is what the trade map looks like with no merchant: If I had no merchant at all, my power would push trade downstream, but aragon would make that travel to genoa instead of Seville. On the other hand, if I tried to collect trade in tunis, i would take a 55 percent penalty to trade power, leaving me with only around 25 percent power. In Sevilla, I can capture 50 percent of that trade and get a total of 1.25 gold from the tunis node, times my actual income modifiers. Because of this, the best course is to move trade downstream from Tunis, which sends 2.5 gold out of 5 to the Sevilla trade node. In this game I have roughly 50 percent power in both the Tunis and the Sevilla nodes, but my capital is in Sevilla. Here is an example of a game where trade steering is useful: Trade being pushed downstream occurs wihtout a merchant in nodes other than your capital, but you cannot change which direction trade flows downstream unless you have a merchant there. To move trade from areas where you have low power to areas where you are dominant, and to move trade from a node to the node where your capital is to avoid taking a trade power penalty. Trade steering is used for two primary purposes.
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