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U.S grain exports hit hard by super hurricane

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Recently, category IV hurricane IDA hit the United States, bringing great disaster!

On August 29, category IV hurricane "IDA" landed in Louisiana, bringing a strong wind with a speed of 240km / h. The waves soared to 4.8m high, and a large area of mountain torrents erupted. It has become one of the strongest hurricanes that have attacked Louisiana since 1850.

US President Joe Biden said Monday that hurricane IDA had caused "catastrophic" damage. Nearly 1.2 million households and businesses in Louisiana and Mississippi, where the hurricane passes, have lost power. New Orleans has almost no power. The Mississippi River is also threatened by floods.

Hurricanes threaten exports of the world's largest food exporter

In addition to endangering the energy supply of the United States, it will also interfere with the main export routes of soybeans and corn. The United States is the world's largest exporter of corn and the second largest exporter of soybeans, while the lower Mississippi River is the country's largest exporter of soybeans and corn, accounting for more than half of U.S. exports. Data show that Aida's attack will affect 59% of the major agricultural exports of the United States.

As the largest city in Louisiana and an important port in the United States, New Orleans Port Authority was forced to suspend the container terminal and bulk cargo transportation business due to the storm. Local agricultural traders stopped exporting and closed at least one soybean mill.

At present, it is the busiest time for grain exports from U.S. agricultural ports. This problem may intensify as the United States is about to usher in the peak of the harvest season in the coming weeks.

Farmers in the Midwest will soon begin harvesting corn and soybeans, a large part of which will flow to the Mississippi River and then transported around the world through the Gulf of Mexico. The United States is the world's largest supplier of corn. If the grain elevator and port terminal are powered off and damaged, it may threaten the export.

Grain trading giant Cargill said on Monday that the hurricane caused "serious damage" to the grain factory in Louisiana and "serious damage" to a local agricultural wharf. There is no timetable when to resume operation.

The lower Mississippi River is by far the largest soybean and corn export region in the United States, accounting for more than half of the total exports of the United States. Under the pressure of the hurricane, major grain traders closed their export terminals and at least one soybean crushing plant over the weekend. Barge traffic on the Mississippi River stalled and power outages in New Orleans led to the suspension of grain exports in the Gulf of Mexico and terminal damage in the port of New Orleans.

Affected by the negative impact of "IDA" interfering with grain exports, US CBOT corn, soybean, wheat and soybean oil futures all fell on Monday. Among them, corn futures led the decline of grain and oilseed futures by nearly 3%, soybean oil futures fell by nearly 2% and soybean futures fell by 1.6%.

Corn and soybean production may be affected

Louisiana is rich in agricultural products. Hurricane IDA will threaten food production and affect the quality of crops in the harvest season, which will eventually be reflected in the price of food.

According to the prediction agency maxar, "IDA" may submerge the farmland of cotton, corn, soybean and sugarcane crops after landing, among which rice and corn crops may be most threatened by hurricanes, especially at the beginning of the harvest season.

Some media quoted agricultural scholars as saying that the storm may delay the harvest progress of the whole crop, the rice crop to be harvested may fall down and reduce the grain quality, and the late crops will increase the risk of disease due to the high humidity environment. Corn producers also face the same problem. They may not only have crop lodging and harvest loss, but also need to worry about grain quality.

However, some traders and analysts are "cautiously optimistic" that crop exports will pick up again later this week. Rich Nelson, chief strategist of Allendale Inc., pointed out that on the positive side, the harvest season has not yet begun. At the time of the hurricane, the transportation of corn and soybeans in the United States was close to "seasonal lows this year".

Source: China Grain network


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