China’s soybean futures soared 5% in Monday trading, on track for their biggest daily gain on record after cold weather in the country’s northeast raised serious concerns for crops.
Investors dove into domestic soybean futures Monday morning, betting on tight supplies after early frost hit parts of the northeast, likely damaging yields and crop quality.
“There was news that low temperatures in the northeastern provinces including Heilongjiang and Inner Mongolia have hurt soybeans there. Then money went in on the news,” said Tian Hao, senior analyst with First Futures.
The average daily temperature in China’s northeast region fell to 8.7C on Saturday, well below the average for the time of year of 16.3C.
The ongoing trade war between Beijing and Washington isn’t helping the situation, with tariffs being suggest by both sides.
But this latest rise in Soybean futures can be solely attributed to the poor weather.
A general trend to cooler times is expected with the Grand Solar Minimum’s intensification.
Food price spikes followed by outright shortages are on the cards.