Ample grain supplies to keep lid on global prices
In particular, the US market concerns relate to the transition from the larger El Niño climate pattern to its little sister, La Niña.
Meteorologists expect this transition to occur in early spring, with the intensity of both easing by late spring.
The prolonged nature of previous transitions has led to sustained damage to grain crops, leading to grain price volatility.
However, while global corn and soybean futures have gone haywire in recent storm transition years, US analysts believe that plentiful supplies, both overseas and in the domestic US market, should provide a buffer against any disruptions this year and dampen any market rallies.
US traders told news agency Reuters that the market is not focused on the predicted change in the weather pattern, particularly since the shift to La Niña, which leads to a cooling of Pacific Ocean temperatures that may bring hot and dry weather to key US growing areas, could even happen too late to affect crop development.
Furthermore, some meteorologists say that the correlation between La Niña and adverse growing conditions has been overstated.
Corn futures have surged an average of 39.4% in past transition years, while soybeans have averaged a 31.8% spike.
In 2010, the last time US farmers faced an El Niño-to-La Niña shift, corn posted a year-on-year gain of 51.7%, while soybeans rose 34%.
