Super El Nino threatens Latin America’s food exports: How it could impact  global food supplies

El Nino occurs when sea surface temperatures rise above normal in the central and eastern tropical Pacific Ocean. The change alters weather patterns across large parts of the world. In Latin America, the effects vary by location. Southern parts of the continent often receive more rain, while northern areas face higher drought risks.

The El Nino disruption has already raised concerns across agriculture and transport. Parts of the Caribbean and the Amazon face dry conditions. An unusually wet Southern Hemisphere winter has also affected parts of the region. Changes in Pacific marine ecosystems have added to concerns for fishing communities.

The impact on food exports could prove significant because Latin America supplies major global markets with soybeans, corn, wheat and other agricultural products, reported Reuters. The weather pattern could help farmers in some areas through better soil moisture. But excessive rain, floods, disease and damaged transport links could reduce the benefits.

What could happen to crops?

Argentina, Paraguay, Uruguay and southern Brazil could receive above-normal rainfall during the El Nino cycle, reported Reuters. For farmers in these major agricultural areas, extra water could support crop production.

Argentina’s fertile Pampas could see better soil moisture for planting. The additional water could also improve conditions for soybeans, corn and wheat during the December-to-February summer season.

German Heinzenknecht, a meteorologist at Argentina’s Applied Climatology Consultancy, said that El Nino could boost soybean, corn and wheat harvests by improving soil moisture and water availability, as reported by Reuters.

More rain, however, does not always mean better harvests. Excess humidity can increase fungal diseases. Heavy rainfall can also wash nutrients out of fertilised fields. Farmers may then face higher costs to protect crops and maintain yields.

Flooding poses another major risk. Rural areas that already face flood risks could suffer more damage if rainfall becomes intense. Flooded fields can delay planting and make it difficult for farmers to reach their farms.

Muddy roads could create another problem. Farmers need road access to apply fertilisers and chemicals and to move harvested crops. Poor road conditions could delay those activities at a crucial time in the agricultural cycle.

Many rural roads in the agricultural heartlands of southern South America already remain in poor condition. Heavy rainfall from September could make those problems worse.

Flooding could also spread beyond farms. Cities, highways and transport routes to ports could face disruptions. Any major interruption along these routes could affect the movement of agricultural products from farms to international markets.

Paraguay has already prepared for the risk. Its government put military units on alert and mobilised civilian engineering teams in July because of concerns over heavy rainfall and flooding.

The impact will not remain limited to the southern agricultural belt. Peru’s northern coast could face flooding while its highlands could experience water shortages. The United Nations Food and Agriculture Organization expects similar patterns in Chile and other parts of the Pacific coast.

Warmer ocean temperatures could also hurt the fishing sector. Commercial fish could move into deeper waters as sea temperatures rise. That could reduce catches and put pressure on fishing industries.

Peru has already faced a sharp decline in fishing activity. Fishing activity fell 31% in the first five months of the year, reported Reuters.

Could El Nino disrupt trade and energy?

The effects of El Nino could extend well beyond farms. Uneven rainfall could reshape energy supply, river transport and international trade across the region.

Argentina could benefit from changing energy demand. Hotter and drier conditions in northern and western Brazil could increase demand for Argentine natural gas, reported Reuters. Thermal power plants may need more gas when drought reduces other sources of electricity.

Southern Brazil and northeastern Argentina could face the opposite situation. Higher rainfall could increase water levels in the Parana River and improve the use of hydroelectric dams along the river system.

Rainfall in hydroelectric basins across southern Brazil reached 256% of the long-term average in July, reported Reuters citing data from grid operator ONS.

Brazilian meteorologist Leydson Dantas, a specialist at the country’s National Institute of Meteorology, said, “Every El Nino tells a different story.” He added that some parts of central-western and southeastern Brazil can receive a month’s worth of rain within a week during some events, as reported by Reuters.

The contrast between wetter and drier regions could create major challenges for Latin America’s economy. Areas that receive heavy rain may struggle with floods and damaged infrastructure. Areas that receive less rain may face drought, heat and wildfires.

Northern Brazil faces a particular concern because of its vast river network. The Amazon basin provides an important transport route for agricultural commodities, including soybeans.

Drier conditions could reduce water levels in rivers and make it harder to move large volumes of goods. This matters for Brazil because the country ranks among the world’s largest soybean exporters.

Lower river levels could increase transport costs and create delays for exporters. Farmers may produce crops but still face problems getting them to ports and overseas buyers.

The risk also extends to the Panama Canal, one of the world’s most important trade routes. Drought could reduce the amount of fresh water available to operate the canal.

The Panama Canal Authority has already tightened restrictions on shipload weights to conserve water. It has also gradually reduced maximum vessel drafts.

Lower draft limits mean ships cannot carry their full cargo capacity. Shipping companies may have to reduce loads, which can raise transportation costs and create delays in global trade.

A planned reservoir intended to improve Panama’s water security will not be ready in time to address the immediate risk. The canal authority has said it does not expect to reduce daily transit slots unless it becomes necessary.

Competition for available passage has already increased. Last-minute slot auctions have fetched millions of dollars as some vessels seek alternatives to trade routes affected by security tensions near the Suez Canal.

The combination of drought, lower ship capacity and alternative shipping routes could therefore increase costs for exporters and importers.

El Nino could also create a challenge for Venezuela, where the electricity system already faces major problems. The country has less than 13,000 megawatts of available generation capacity out of 36,000 MW installed, leaving a supply shortfall of more than 1,500 MW between current supply and demand, reported Reuters.

Nearly 90% of Venezuela’s thermal generation capacity remains out of service after years of underinvestment and delayed maintenance, reported Reuters citing energy expert Nelson Hernandez. The country has therefore become heavily dependent on hydropower, which provides more than 80% of its electricity, reported Reuters.

A drought could put additional pressure on that system because lower water levels can reduce hydropower generation.

Interim President Delcy Rodriguez said El Nino was already affecting Venezuela and could bring drought before the end of the year, reported Reuters. The government has called for greater conservation of electricity and water.