As the El Niño weather pattern continues to develop, various disruptions to agricultural production are expected around the globe. This year’s El Niño follows a rare, three consecutive years of La Niña, which has many of the opposite effects to El Niño on agricultural crop growing conditions. But while El Niño weather years have some general tendencies, no two are ever alike, making it hard to predict exactly which crops and where will witness any notable affects. However, we are already getting an early taste of where some trouble spots might be, including rice crops in Asia and wheat in the Southern Hemisphere. Below are more details about how the world’s most important ag crops could be affected by El Niño.
Rice – The El Niño weather pattern is already raising concerns about rice crops in Asia. Dry conditions are threatening production in India, Thailand, Vietnam, and other major exporters. During the last major El Niño event in 2015-2016, Southeast Asia experienced an output decline of -15 million metric tons (MMT) of rice compared with the preceding two years, according to a report by the ISEAS-Yusof Ishak Institute, in Singapore. The USDA in its most recent supply and demand outlook (WASDE) forecast that global rice production would hit a record 518.13 MMT. However, global domestic consumption is forecast to outstrip production by nearly 3 MMT and push global ending stocks to the lowest levels since 2017/18.
Wheat – Another volatile crop in El Niño years is wheat. Overall, global wheat output falls an average of -1.4% during El Nino years, according to the study by Japanese meteorologists. Troubles are already on display in Australia where El Niño-induced drought conditions intensified after the driest September on record, prompting forecasts for double-digit production declines. USDA pegs Australia’s 2023/24 crop at 24.5 MMT versus nearly 40 last season, a decline of just over -38%. During the 1982/83 extreme El Niño, wheat yields in Australia were reduced -41% from the 5-year average. In contrast, during the 2015/16 El Niño, Australia’s wheat belt was expected to experience a drought but wheat yield ended up being close to the 5-year average.
Meanwhile, Argentina is still suffering under a La Niña-induced drought. According to data from the Rosario Stock Exchange (BCR), since mid-2020, Argentina’s agricultural heartland, covering the provinces of Santa Fe, Buenos Aires, La Pampa and Córdoba, has recorded a water deficit equivalent to an entire year’s rainfall. The country has received some rainfall but it’s not been enough to revive the parched land. The El Niño phenomenon usually causes higher-than-usual rainfall in Argentina’s main agricultural provinces but they have yet to materialize. In early October the Rosario Grains Exchange warned the country’s wheat crop could suffer “massive losses” due to another drought.
Corn – Past El Niño events have led to deficit corn production in India, China, southeastern Africa, and parts of Central America and northern South America. The effects tend to be strongest in southeastern Africa, according to GeoCrop Monitor. While El Niño years have been linked with some of the most successful US corn crops, the weather pattern has also prevailed over some of the worst harvests. El Niño years have been more positive than negative for US corn farmers, though – nine of the 11 best-yielding years within the past four decades coincided with El Niño or neutral-positive during June-August, according to Karen Braun at Reuters.
El Niño can have a significant impact on Brazil’s agricultural production. Typically, El Niño results in above-normal rainfall in southern Brazil and below-normal rainfall in central and northern Brazil. If heavy rainfall delays harvest of soybeans early next year, it could delay planting of the second “safrinha” corn crop, posing an increased risk of lower corn yields. Conversely, if rains don’t materialize and conditions are overly dry, farmers may plant fewer safrinha acres.
In Argentina, similar to wheat, the corn situation is complicated by the lingering impacts of La Niña. A report from the Buenos Aires grains exchange recently warned that if rains don’t materialize, it puts at risk around 2.7 million acres of corn planned for the South American country’s most productive farming zone.
Soybeans – Average global soybean yields generally improve during an El Niño event when the warm cycle is in place between at least March and September. A recent study by Japanese scientists shows that during El Nino years soybean yields jumped +3.5% as rainfall patterns helped growers in the U.S. and South America. However, US yields were dinged following El Niño events in 1991 and 2002, in which summer temperatures were too warm. Additionally, in 1991, planting was severely hampered by wet spring conditions.
As with other crops, Argentina’s soybean outlook is complicated by the ongoing drought. Generally, El Niño favors the crop. During the 2015/16 El Niño, Argentina’s 2015/16 soybean yields were up by nearly +9% from the 5-year average. The largest increase in soybean yield was +31% from the 5-year average which occurred during the 1997/98 extreme El Niño event. (Sources: GroIntelligence, Sydney.edu, Platts, Reuters, USDA)
