There is more than a 90% chance that El Niño will continue through the Northern Hemisphere’s winter and an 80% chance it will last into early spring of 2016 according to the NOAA (National Oceanic and Atmospheric Administration).

El Niño is an abnormal, yet periodic, warming of the central and eastern equatorial Pacific Ocean. It occurs every two to seven years, but a strong event has not occurred since 1997. El Niño warms this patch of the ocean for six to 18 months for reasons still not well understood.

NOAA forecasts the potential temperature and precipitation changes associated with El Niño will be minimal through the Northern Hemisphere’s summer, but will intensify into late fall and early winter.

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There is an increasing chance that this year’s El Niño may become the strongest since 1997-1998 and play a stronger role in US and Australia and New Zealand weather.

El Niño typically supports wetter conditions in the south west of the US and droughts in Australia and New Zealand.

California is currently suffering from one of its worst droughts on record, directly affecting milk and other agricultural production. The increased rainfall usually associated with El Niño could ease the pressure on the region’s farmers.

If this event occurs this year it will have a much greater impact on milk prices than any GDT auction.