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Informist, Thursday, May 21, 2026

 

MUMBAI – Rice and wheat are likely to be the most affected grains due to El Nio conditions that may emerge from mid-2026, according to BMI, a Fitch Solutions company. El Nio events typically suppress rainfall in South and Southeast Asia, which comprises India and Pakistan, together accounting for 17% of global wheat production, it said.

 

The Climate Prediction Center, of the US National Oceanic and Atmospheric Administration, sees an 82% probability of El Nio conditions developing during the May to July period, with probabilities rising during the second half of 2026, BMI said in a report. Climate Prediction Center strength forecasts indicate a 66% chance of at least weak El Nio conditions during the Jul-Sept window, it said.

 

Rice appears among the more exposed crops, as nearly 60% of global production is concentrated in South and Southeast Asia, according to the report. But crop calendars may provide some insulation against downside risks, it said.

 

A weaker El Nio event during the June-August window, leading to drier-than-normal conditions, could support harvest operations for winter-spring crops in Vietnam and provide the market with the largest buffer among major producers. On the other hand, in India, Pakistan and Cambodia, the expected transition of El Nio to moderate conditions is expected to occur around the tail end of crop development, which may provide partial insulation for the rice crop from adverse weather impacts, BMI said.

 

Meanwhile, wheat production is seen as one of the more exposed grain markets under the projected El Nio event, with risks heightened by crop calendar overlap across India, Pakistan, Australia, Mainland China and Argentina. "In India and Pakistan, which together account for around 17% of global wheat production, planting and early crop development typically begin around October, when El Nio risks are skewed towards stronger outcomes," BMI said. This raises downside risks to yields should rainfall undershoot seasonal norms during development stages, it said.

 

However, El Nio offers a more favourable outlook for soybean than for other major grains. "The transmission mechanism in South America runs counter to the drought impacts seen in Asia. Across Argentina and southern Brazil, El Nio events historically bring above-average rainfall, which is supportive for soybean planting during the October 2026 sowing window," according to the report.

 

"Overall, we believe that an earlier-than-expected intensification of El Nio would materially raise downside risks to crop yields, particularly across South Asia, Southeast Asia and parts of South America," it said.  End

 

Reported by Taniva Singha Roy

Edited by Saji George Titus

 

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