Weather will provide more market volatility in the coming year


KANSAS CITY, MISSOURI, US — It is hard to believe that we are already in the final weeks of 2021, and it is time to start looking forward into 2022.  This past year of weather certainly provided a few bouts of excitement with dryness in Russia, heat and drought in western North America, flooding in China, a longer-than-usual India Monsoon and a late season threat to Australia winter crop quality because of too much rain in more recent weeks.

The year ahead is going to be equally exciting and will be dominated by weather phenomena like La Niña, the 22-year solar cycle and Pacific Decadal Oscillation. These three features will have a huge role to play on North America and there may be some influence from the same on Russia, China, South America and Australia.

The largest drought in the world is still over western North America, extending from the Mexico border in the southwestern United States through the high Plains, Rocky Mountains, Great Basin and Pacific Coast states to eastern and southern Alberta and Saskatchewan, Canada. The drought is in its second year of existence, and after beginning in 2020 it has not changed much. One year ago drought was impacting virtually the same areas, although most of Mexico was included. Mexico’s monsoon season in 2021 was sufficient to break down the drought, but not much other change has occurred in the United States or Canada.

The simultaneous occurrence of La Niña and the 22-year solar cycle has raised much concern about North America weather in 2022 because statistics from the past suggest when these two phenomena occur at the same time there is a higher potential for a multi-year drought. As already noted, the drought in North America is in its second year, and the data suggests the odds are high that drought will continue in the New Year, although there will be some changes.

Drought is expected to evolve in the US Plains and also may expand into a part of the western Corn Belt during the late winter and early spring while dryness in the western United States might be slowly whittled down during the winter and especially in the spring. Developing dryness in the central United States will be a concern because the Pacific Decadal Oscillation may help establish a ridge of high pressure over the central United States earlier than usual in the spring, allowing dryness and warm weather to build up in the Plains and western Corn Belt earlier than usual, making the summer seem longer and raising the potential for crop moisture stress. Dryness also is expected to evolve in the southeastern United States because of La Niña, and if everything goes wrong the two areas of dryness might merge together.

Russia’s spring wheat and sunflower seed production areas already suffered yield losses in 2021because of dry and warm biased weather. There is evidence that the pattern could be repeated again in 2022, and since soil conditions have not been satisfactorily recharged with moisture the region could also get a head start on dryness during the growing season, raising the potential for crop moisture stress.

Northeastern China may experience less-than-usual rainfall during the summer of 2022 because of an 18-year cycle pattern that has suggested an unfavorable rainfall pattern might evolve during the growing season. After two years of excessive rain in parts of eastern China it would not seem unrealistic for the weather to trend drier in at least a part of the nation. In contrast to the drier biases suggested in Russia and China, Europe may experience a wet growing season with too much moisture at times beginning in the spring and continuing into the summer.

Southern Hemisphere crop areas also will have the opportunity to experience anomalous weather. Most of the blame for weather anomalies in Brazil, Argentina, South Africa and Australia will be given to La Niña, and the latest forecasts for that phenomenon have suggested there is some potential for it to linger through the second quarter of 2022.

La Niña’s influence on South America already is being seen with below-average precipitation falling in southern Brazil, southern Paraguay and eastern Argentina recently. The below-average precipitation bias dominated November in these areas as well, but cool temperatures and well-timed precipitation events prevented a significant dryness problem from evolving. As time moves along in December and January, the potential rise for warmer temperatures to evolve — at least for a little while — and rainfall will continue lighter than usual. Eventually, dryness is expected to fester long enough to induce some crop moisture stress and a threat on yields may result. However, the yield reduction will be mostly in southern Brazil and eastern Argentina, leaving other areas in both countries with a potential for high yields.  Good yielding crops in the north may help to counter losses in the south due to dryness limiting the overall loss and leaving South America with good production potentials.

There is potential that La Niña will linger longer than originally expected, extending its presence through the second quarter of 2022. If that occurs Safrinha corn planting in some southern Brazil crop areas may take place in low soil moisture, but conditions should end up being mostly good for that crop.

An extended bout of La Niña in Australia could induce some flooding in January and wet biased field conditions may be present in the autumn when wheat, barley and canola are normally planted. In the meantime, wet weather in January could lead to some significant flooding in a few areas especially in Queensland.

South Africa’s reaction to the extended La Niña event should be good for its summer crop production and may help ensure moisture abundance for the autumn planting of wheat, barley and canola.

Overall, 2022 will provide the usual dramatics from weather periodically, but a close monitoring of conditions in the United States, Russia’s New Lands and possibly northeastern China is warranted for possible dryness, but Europe may trend too wet. If all of the anomalies occur as suggested (which may be a little doubtful) the overall impact of weather on crop production may be a little like that of 2007-08 when multiple weather-related crop production issues occurred to shorten world supply of grain and oilseeds. In the meantime, Canada’s Prairies are expected to have a much improved summer weather pattern in 2022.



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