La Niña Set to Impact Global Shipping Trade Patterns

Meteorologists from various countries have concluded that the weather phenomenon known as La Niña is expected to affect the world as early as next month, significantly altering shipping trade patterns as we move into the new year.

La Niña is characterized by cooler-than-average ocean temperatures and tends to have a substantial impact on various commodities.

Current forecasts indicate a 70% likelihood that La Niña will develop between August and October this year, with a 79% chance of persisting through the Northern Hemisphere winter and into early 2025.

“This transition is significant for agriculture as it can lead to diverse weather patterns, such as reduced rainfall in parts of South America, including South Brazil, Argentina, and Uruguay, potentially resulting in droughts that adversely affect crop yields,” states an update from Greece’s Ursa Shipbrokers. The southern US is also expected to face more drought-like conditions.

Conversely, regions such as Southeast Asia and India might experience increased rainfall, which would benefit crops like rice and palm oil and boost hydropower generation potential.

“In Australia, heavier-than-average rainfall and the greater frequency — and intensity — of cyclones associated with La Niña could hinder the extraction and export of key mineral commodities, such as iron ore and coking coal,” according to a recent report from S&P Global.

La Niña’s influence also extends to the Atlantic hurricane season, typically leading to an increase in hurricane activity. Additionally, La Niña is expected to cause colder-than-normal winters in North Asia and Northern Europe, resulting in higher energy consumption from utility companies.