Because it floods. Epically.

There has been the better part of a century of flood control engineering on the Ohio and Mississippi to reduce the dangers, but even with these floodgates and levees, dams and contingency plans, there are tough choices about what gets inundated and what gets flooded. Even now with many billions of dollars of flood control infrastructure, this is still a flood prone area, and you can't protect it all.

So the environs of "what seems like would be an excellent site for a trading hub" got flooded out in a big way before modern flood control, and still do. So there's a lot of land that never developed because it was simply too unsafe. And there are other sites which though protected are surrounded by vulnerable areas.

The Mississippi (and Ohio) are naturally flood prone rivers-- with an enormous watershed, the combination of snowmelt and winter or spring rains can bring swift and dramatic increases in volume. And that volume pours through a river which passes through many areas only slightly elevated above sea level, very different from, say, the Columbia which passes through steep sided canyons for much of its path down to the Pacific; an increase in flow in the Columbia would produce only local flooding, but an increase in flow in the Ohio or Mississippi could -- and still does-- inundate vast areas.

See:

Roos, C. M. “CAIRO AND THE SUPERFLOOD OF 1937.” Journal (American Water Works Association), vol. 29, no. 9, 1937, pp. 1280–1287.

“THE FLOOD OF 1937: THE CORPS BUILDS FLOODWAYS.” Mississippi River Tragedies: A Century of Unnatural Disaster, by CHRISTINE A. KLEIN and SANDRA B. ZELLMER, NYU Press, 2014, pp. 79–89.

LANE, T. A. “1961 Flood on the Lower Mississippi.” The Military Engineer, vol. 53, no. 356, 1961, pp. 440–441.

WEART, DOUGLAS L., and J. W. BRUCE. “Ohio River Basin Flood Control Plan.” The Military Engineer, vol. 40, no. 274, 1948, pp. 345–349.

This comes up every couple of years—and in fact I remember wondering the same thing way back when I was an undergrad. Here's my response from last time:

Cairo is extremely flood-prone, completely surrounded by levees. Its situation certainly did not attract early settlers: it wasn't even founded until 1837, decades after other areas of Southern Illinois and the Ohio Valley, and grew very slowly.

Merely being at a confluence of rivers that can handle the same kind of boats is not a great advantage over other river ports. Any cargo just sails past. As a port, having easily accessible bluffs out of danger in spring floods would give places like St. Louis the advantage. Places where cargo must be shifted from ship to barge or railroad (like Chicago) are classic entrepôts, and have natural advantages as places to set up factories. Once the Illinois Central Railroad bridged the Ohio, it could transport agricultural products all the way to New Orleans with no need to transfer cargos to riverboats at Cairo.

TLDR: no need to transfer cargo there from one mode of transport to another, so nothing makes the confluence better than any other place along the river.