The weather condition known as La Niña could materialize in the second half of the year and have a negative impact on crop yields in the United States, Argentina and Brazil. This suggests upside for major crop prices, stabilizing U.S. farm profitability following the sharp decline observed in 2015. The world has been under the influence of a powerful El Niño since fall 2015, blamed for extreme weather events around the world. Interestingly, the ocean-warming phenomenon is essentially yield-neutral for U.S. agriculture. With El Niño progressively weakening and forecast to disappear by summer 2016, the situation is expected to be different.

El Niño’s sister event, known as La Niña, is characterized by drier weather in major grain producing regions of the Americas.

The 2015–2016 El Niño weather system, which tied 1997–1998 as the strongest on record, has led to a major increase in rainfall in the southern United States since 2015. Affected by a four-year droug