Saturday, January 7, 2012

WEATHER ANOMALIES: La Niña Forecast to Last Into Spring of 2012, Bringing More Drought Conditions to U.S. and South America - Sparking Concern in Grain, Oilseed, Sugar and Coffee Markets!

La Niña, the weather phenomenon widely blamed for withering drought in the southwestern United States and South America, will last into the Northern Hemisphere spring of 2012, the U.S. Climate Prediction Center said on Thursday.

"The latest observations ... suggest that La Niña will be of weak-to-moderate strength this winter, and will continue thereafter as a weak event until it likely dissipates sometime between March and May," the CPC said in its monthly update. The CPC is an office under the National Oceanic Atmospheric Administration (NOAA). La Niña, which can last for several years, is the opposite number of the more infamous El Niño anomaly.

La Niña is caused by an abnormal cooling of waters in the equatorial Pacific Ocean. El Niño leads to warming of those waters. Both wreak havoc in weather patterns from South and North America to India and possibly even Africa. This La Niña is already sparking concern in grain, oilseed, sugar and coffee markets. The 2011/12 corn crop of Argentina, the world's No. 2 supplier, will be smaller than initially forecast due to dry weather linked to La Niña although output should still hit a record. In leading palm grower/exporter Malaysia, severe monsoon rains from La Niña could disrupt harvesting and boost palm oil prices. Rains in the December to March period are also posing a threat to the coffee crop in Colombia, the world's top source of high quality beans.

Country Hedging Inc senior analyst Sterling Smith said La Niña may increase a "little bit" that dry conditions will persist in many key producing areas. The CPC said La Niña means "drier-than-average conditions are more likely across the southern tier of the U.S." That could pose problems for farmers planning to sow wheat or cotton in the south of the United States. Farmers in Texas, which just saw a La Niña inspire once-in-a-century drought last year, may see a second year of drought hit their cotton crop. Texas is the biggest cotton growing state in the country. A La Niña which persists to the end of the northern hemisphere spring would bring the phenomenon to the cusp of the start of the annual Atlantic hurricane season which begins on June 1. - MSNBC.

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