El Niño's demise may have huge implications

by Drew Lerner
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Are you sick of hearing about El Niño and how bad it is going to be? Where is the calamity and where are the higher global commodity prices that were forecast over the past few months? Rice – one of the first crops to be impacted by El Niño conditions – has experienced a collapse in prices in recent weeks after weather hype helped to pump up prices for quite a ride, but the reality is that rice production and supply remains abundant.

Sugarcane, most grains and many oilseed products have also experienced a recent slide in prices. Many analysts contribute the slide to China’s economic problems and the general world economy, but if there was a serious supply problem in agricultural commodities there would be much more support for those markets than what has been seen in recent weeks. Sure, production is off in parts of Southeast Asia, South Africa, Europe and Canada, but how much of that can truly be attributed to El Niño?

There is no correlation with drought in Europe and El Niño events. There is some connection to western Canada droughts and El Niño. Of course, there is a truly strong association with droughts in Indonesia, Australia and Malaysia with El Niño. However, one would expect the droughts in these areas to be many times worse than they have been relative to the media hype of El Niño; the losses are just not there. So far, this El Niño is the second strongest in recorded history (since 1950).

India has had few production problems this year. Last year was far more challenging, and El Niño was not fully evolved at that time. Similarly, eastern Australia has some of its best soil moisture seen in many El Niño years leading into the wheat, barley and canola reproduction season. Conditions could still turn sour in India and Australia, but for India the impact of a dry finish to the summer will be small relative to the hype of the one of the most significant El Niño events on record.

Southeast Asia has certainly had its share of adverse weather in recent months. The Philippines had severe drought in the first and second quarters of this year, hurting off-season rice and other crop production. However, government officials encouraged a delay to the planting of main season crops in hopes of catching improved rainfall later in the year, and that is exactly what is happening. Main-season Philippines rice and other crop production may be better than expected because of delayed planting.

Indonesia and Malaysia rainfall has been quite restricted in the south in recent months, while northern crop areas have seen periodic rainfall that has prevented drought from being nearly as serious as it has been in other El Niño events. There is still potential for this year’s El Niño to harm Indonesia, Malaysia, the Philippines and eastern Australia, and the situation will be closely monitored. But for India and China, where the main production year will soon be winding down, the potential impact of El Niño dryness may prove to be minimal.

Troubling historical patterns

World Weather, Inc. believes the end of El Niño will occur in the spring of 2016, and there is a chance that the cooling ocean temperatures that drive the demise of El Niño at that time could be significant. Many of the strongest El Niño events on record since 1950 have ended very quickly and been followed by La Niña events. In the United States, La Niña events often bring more trouble to crop development than El Niño events. Usually, El Niño events bring moisture abundances to the United States whereas La Niñas tend to take away moisture from whatever weather pattern is prevailing at the time of evolution.

Years in which strong El Niño events were followed by significant La Niña events include: 1972-73, 1982-83, 1987-88 and 1997-98. No one needs much of a reminder about the summers of 1983 and 1988 in which significant droughts impacted a part of the U.S. agricultural region. The drought of 1983 impacted a large part of the central and lower Midwest, Delta, southeastern states and southern Plains. The drought of 1988 was extensive across the Midwest and northern Plains and extended into a parts of Canada’s Prairies. The summer of 1998 was drier and warmer than usual from the southern U.S. Plains into the southeastern states, while rainfall in the Midwest and northern Plains was near to above average, making it one of the less threatening years for El Niño to La Niña summer seasons. The summer of 1973 was dry in the northern U.S. Plains and in a part of the northwestern Corn Belt, although there were some other areas of dryness in the Delta and southeastern states, as well, and temperatures that summer were quite warm to hot across the northern Midwest and northern Plains.

As noted previously, La Niña events take away precipitation from whatever the prevailing weather pattern is at the time. To help determine what conditions are expected to be like in 2016 we turn to the 18-year cycle which controls the upper airflow pattern. This repeating pattern can help determine rainfall biases during the coming spring and summer. The first thing we noticed in this analysis is the spring of 2016 will be wetter biased in the southeastern states and parts of the U.S. Delta and possibly drier biased in the southwestern Plains and a part of the Pacific Northwest. Spring temperatures are advertised to be warm in the north and cool in the south.

The 18-year cycle data also suggested that the summer of 2016 would possibly be warmer and drier biased in the southern Plains, Delta and southeastern states. This drier and warmer bias is of concern because the El Niño to La Niña summers tend to produce less rain from the eastern and lower Midwest through the southeastern states and into a part of the central Plains and lower Mississippi River Basin area. El Niño to La Niña summer temperature biases tend to be warmer than usual in most of the Midwest northern and central Plains, Delta and interior southeastern states.

The conclusion to all of this suggests the spring of 2016 may be very wet in the central and southern Plains, lower Midwest, Delta and southeastern states and summer may be drier and warmer than usual. The description is somewhat similar to the drought year 1983, although there will likely be some deviations that cannot be identified quite yet. If the implications here turn out correct, the balance of this El Niño event may not be nearly as important to the commodity markets as might be problems in the United States during the summer of 2016. If you are looking for a reason to drive futures markets higher, the wet spring and dry summer scenario for 2016 might just prove to be the trigger needed.

One last comment that has to be made is the scariest of all for U.S. 2016 weather, and be careful not to read more into the statement than what it says. The last time both the Ohio River Basin and the southern U.S. Plains experienced record or near-record wet spring and early summers, like this year, occurred in 1935. The following year, 1936, turned out to be the second worst drought year on record, following 1934. The 2012 drought has been compared to 1934, but we have yet to see a follow up drought year and perhaps 2016 may be it.

Drew Lerner is a senior agricultural meteorologist with World Weather, Inc. He may be reached at worldweather@bizkc.rr.com. World Weather, Inc. forecasts and comments pertaining to present, past and future weather conditions included in this report constitute the corporation’s judgment as of the date of this report and are subject to change without notice