THE GLOBAL WINDOW OF TURKISH FOOD AND AGRICULTURE The Global Window of Turkish Food and Agriculture Sector
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August 2026…
Severe global supply chain disruptions resulting from rapidly warming surface water, droughts threaten to push inflation up, putting global growth at risk…
LONDON / BRUSSELS / ISTANBUL…
The El Nino weather phenomenon is rapidly intensifying, warming surface waters in the Pacific Ocean, and is expected to cause droughts, floods, and extreme temperatures, taking a heavy toll on the global economy.
The World Meteorological Organization (WMO) expects a particularly strong El Nino this year.
The WMO’s report says El Nino conditions are expected to develop between August and October, with the sea surface temperature anomaly reaching around 2.9C, based on a multi-model average. The temperature rise could peak around November.
The US National Oceanic and Atmospheric Administration (NOAA) expects El Nino to reach very strong levels between October and December, with more than a 90% chance, and puts the likelihood of the phenomenon persisting until early spring next year at 97 percent.
The impact of El Nino has far-reaching implications for the global economy through agricultural production, food and commodity prices, energy supplies, logistics and inflation.
Changes in rainfall patterns can lead to drought or excessive rainfall, affecting the supply of rice, corn, soybeans, sugar, cocoa and other agricultural products.
A moderate El Nino can drive up real commodity price inflation by around 3 percent within six to 12 months of its onset, according to the European Central Bank (ECB).
El Nino can also raise global non-energy commodity prices by around 5 percent, with the increase lasting up to 16 months.
The rise in sea surface temperatures due to a strong El Nino could push global food prices higher for about two years, with the increase peaking at 9 percent, particularly affecting soybean, corn, and rice prices.
The World Bank expects global food commodity prices to rise 2.5 percent in the baseline scenario this year, but a strong and prolonged El Nino, along with high energy and fertilizer costs, fuel demand and export restrictions, could push food prices much higher than estimated.
Sugar is the most vulnerable agricultural commodity to El Nino-driven price hikes, as weaker monsoon rains in India, Thailand and Southeast Asia could dampen sugarcane production, while excessive rainfall in Brazil could affect yields, according to Morgan Stanley.
Wetter conditions in Argentina and southern Brazil could also support yields for certain products.
Morgan Stanley expects a sharp, across-the-board rise in grain prices to be less likely and says El Nino’s impact will depend on the region of crop growth and the timing of rainfall…
