Over the last few months, we have seen an explosion in sugar prices during the India (the drought will be easing shortly) and Thailand droughts, cocoa prices reaching multi-year highs on the worst wet weather and disease situation in West Africa in three generations, and global crop problems for cotton. Now, it may be Brazil coffee's turn for crop issues. Following our mostly bearish attitude toward coffee for close to a year, and pretty much a contrarian view, this image below of my proprietary software illustrates how El Nino combined with what we call a warm TNA (Tropical Atlantic) and a positive India Dipole responsible for Australia's new drought, will also cause hot, dry weather for Brazil coffee the next few weeks. This will become more critical in October. As you can see, dry weather (like the 2006 El Nino) will continue to aggravate Australian wheat, with dry N. Brazil weather putting the breaks on the recent major decline in coffee prices (Jim Roemer--www.bestweatherinc.com WeatherWealth newsletter)
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Wow, the weather sure is having a major impact on commodity prices. I was reading something similar about how climate issues are seriously affecting food and crop prices globally. If the drought and hot weather in Brazil do hit the coffee crops as predicted, we're probably going to see a spike in coffee prices too, right alongside sugar, cocoa, and cotton. This could also mean a tough time ahead for coffee shops and consumers. With all these different crops getting hit, it's like a domino effect on global markets. Crazy times we're living in.
In the late 70's Exxon's own climate scientists forecasted with stunning accuracy the long term effects of burning fossil fuels - the velocity of the temp rise, our current temp, & the CO2 PPM. Exxon canned them as a result & spent the money on climate denial. Chart is from NASA.