Freezing Weather in the U.S. Threatens Crops and Livestock Prices
North America has seen some pretty bizarre weather this year. Right now the east coast is seeing record low temperatures as cold, dense air flows down from the Arctic. These freezing conditions are causing havoc for the transportation industry. In addition, several crops are threatened, causing commodity prices to rise.
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Logistics companies are having a hard time getting goods to their destinations on time. The cold temperatures have made traffic a nightmare. Many cities along the east coast are not even equipped to handle the freezing temperatures. They don’t have the snow plow infrastructure to keep roads clear and safe. Plus, meteorologists say the weather isn’t going to get better anytime soon.
Slow traffic isn’t the only problem the transportation industry is facing. Livestock prices have soared because the animals cannot safely be transported in this freezing weather. Additionally, the cold weather is making it difficult for cattle and hogs to gain weight. The same problems are being seen for crops. They can’t be transported.
Several commodities have been affected by the freezing weather. For instance, future prices for winter wheat are at the highest they’ve been in two weeks. The higher prices are partly because crops are freezing and partly because transportation costs are up. One crop that many people are worried about is oranges in Florida. The extreme cold is threatening all sorts of crops. Vice President of Price Futures Group Jack Scoville told Bloomberg, “Some people are starting to buy call option in orange juice just in case it freezes down there.”
It may take a long time for the affected commodities to recover, especially if the freezing temperatures do as much damage as expected. Crops and livestock prices might not recover until next season. Weather is always a game changer in the commodities industry. [/show_to]
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