The Super El Niño

The NOAA and World Meteorological Organization predict that we will see a strong El Niño season, aka a Super El Niño. This will increase average global temperatures around the world, although the effects will be varied across different regions.

Each El Niño event is unique in terms of its evolution, spatial pattern and impacts.

However, it is typically associated with increased rainfall in parts of southern South America, the southern United States, the Horn of Africa and central Asia, and drought over Australia, Indonesia, and parts of southern Asia.

During the Boreal summer, El Niño’s warm water can fuel hurricanes in the central/eastern Pacific Ocean, while it hinders hurricane formation in the Atlantic Basin.

For the May-June-July season, land surface temperatures are expected to be above-normal nearly everywhere. The signal is especially strong over southern North America, Central America, and the Caribbean, as well as Europe and Northern Africa.
Rainfall predictions show strong regional variations.

The Super El Niño will have an outsized effect on soft commodity markets. In the paid subscriber section, I identify a couple markets that have the potential to rally strongly this year, based on where they are in the cycle and the regions that are most likely to see extreme weather patterns.