Grain traders are concerned that a La Nina weather event could produce hotter, drier weather in the U.S. Midwest this summer.
During a La Nina, a cooling of sea surface temperatures in the equatorial Pacific Ocean alters weather patterns around the globe. Grain traders associate La Nina with warmer and drier conditions in the U.S. Midwest crop belt.
The exact likelihood of a summertime La Nina is unclear. But the U.S. Climate Prediction Center, a unit of the National Oceanic and Atmospheric Administration, said in a report that the emergence of a La Nina event in the second half of 2010 was “a growing possibility.”
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NOAA was set to release an updated outlook June 3.
Prospects for a La Nina have raised a degree of uncertainty in the Chicago Board of Trade corn and soybean markets, making it a bullish background factor – even though the U.S. corn crop is off to a very good start and current weather conditions are nearly ideal.
Timing is critical. July is the critical month for the U.S. corn crop, while August is key for soybeans. If a La Nina developed after that, the crop impact would be minimal, and could even help speed the harvest if conditions turned dry.
Elwynn Taylor, extension climatologist with Iowa State University, estimated the chance of a La Nina in developing in June at 25 per cent.
