Weather is still one of the single greatest impacts on commodity supply. La Nina, the little girl, will again create cooler than normal temperatures in the Pacific Ocean. This will lead to above normal rainfall in south-east Asia and eastern Australia. There is also a higher risk of tropical cyclones in the Pacific. The northern US will be wetter while drought will continue in the south. The southern hemisphere growing regions of Latin America will also be drier than normal.
The impact will be strong on grains and cotton in the US and a greater chance of spring floods. There will be heavy rains for coffee in central America, but dry conditions for the soybeans and corn of Brazil and Argentina.
The weather is not supposed to be as severe as the La Nina of 2010-2011 but we can expect that there is again potential for extremes. This will place added stress on those markets which have low inventory to usage.
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