Bone-chilling cold across the U.S. farm belt riled agriculture
markets at midweek as concerns over crop damage and delayed export shipments
sent prices of key food commodities soaring.
Exporters along the Gulf Coast, the country’s largest outlet for
grains, scrambled for barge loads of corn and soybeans as two weeks of
sub-freezing Midwest weather froze the Illinois River, a major grain barge
shipping waterway.
In the Plains, hard red winter wheat prices hit the highest in
six weeks on worries that crops sustained freeze damage, while cattle
prices hit seven-week peaks on concerns over slowed beef cattle production
at feedlots.
And although the harshest cold in the farm belt has likely
passed, forecasters expect temperatures in the central United States to remain
well below normal through at least the end of the week.
“The worst may be over, but the damage is done,” said Drew
Lerner, chief agricultural meteorologist with World Weather Inc.
“Ice accumulations will continue aggressively in the upper parts
of the Mississippi and Illinois River basin over the next four days,” he said.
Prices for grain barges rallied for a second day on Wednesday as
Gulf Coast exporters were forced to turn to shipments loaded along the Ohio
River, which was not iced over.
“Exporters are trying to get some insurance bushels in their
hands. There’s not going to be anything coming off the Illinois River for a
couple of weeks,” said a grain barge trader who asked not to be named because
he is not authorized to speak to media.
Soybean barges loaded in January and delivered to the Gulf
traded as high as 50 cents over Chicago Board of Trade March futures, the
highest since late September. January corn barges traded at 47 cents above CBOT
March futures, a 10-month high.
CME Group Inc, which owns the CBOT, said it is monitoring the
icy conditions on the river, where its approved delivery stations are located.
The exchange’s January soybean contract is currently in delivery.
“At present the majority of regular shipping stations are able
to make/take deliveries,” spokesman Chris Grams said in an email.