Climate forecasters from the National Oceanic and Atmospheric Administration (NOAA) increasingly expect the world to transition from the current neutral conditions into an El Niño weather pattern during the second half of 2026.
This will have implications for supply chains and global food production. And while we doubt most grocery executives spend their time thinking about water temperatures in the equatorial Pacific Ocean – they might want to start for planning purposes.
Some forecasts suggest the event could strengthen further heading into winter and potentially influence weather patterns well into 2027. While El Niño is often discussed as a climate phenomenon, its significance for the grocery industry lies in its ability to reshape agricultural production, transportation networks, commodity markets, and ultimately food prices.
For industry retailers, wholesalers, manufacturers, and suppliers, El Niño is not simply a weather story; it’s a supply chain story. We’ll get into “what exactly is an El Niño?” in a moment.
But first we thought we’d provide some important historical context, and why this is so important to keep on your radar right now…
Historical Perspective: Why El Niño Commands Attention
Every El Niño event is different, but history offers a reminder of why forecasters, farmers, and food companies pay such close attention to its development.
The powerful 1997-98 El Niño is often used as a benchmark because of its global reach. According to NASA, the event was linked to more than 20,000 deaths worldwide and approximately $36 billion in infrastructure damage as floods, droughts, storms, and agricultural disruptions affected multiple continents.
The deadliest El Niño from 1877-1878 brought prolonged droughts and crop failures and is reported to have killed an estimated 50 million in China, India, and Brazil.
I hope that’s grabbed your attention.
More recent El Niño events have demonstrated how interconnected modern food systems have become. The 2015-16 event contributed to weather extremes across Africa, Asia, Latin America, and North America, with international agencies estimating that tens of millions of people required food assistance as agricultural production suffered in various regions.
For the grocery industry, these historical examples serve as a reminder that El Niño should not be viewed as a localized weather event. It is a global climate pattern disruption capable of influencing crop yields, fisheries, transportation networks, commodity markets, and consumer prices simultaneously.
What Is an El Niño in Simple Terms?
El Niño is a weather pattern – part of the broader El Niño-Southern Oscillation (ENSO) cycle. At its simplest, it is warmer than average surface water over thousands of square miles of the largest ocean on Earth. This recurring climate pattern is driven by changes in Pacific Ocean temperatures moving from cold to warm and back.
During El Niño events, this warmer-than-average ocean in the tropical Pacific alters global atmospheric circulation patterns, influencing rainfall, drought, temperatures, and storm activity across the planet.
The effects vary by region – some get rain, others get drought. While localized floods can occur, global agriculture takes the brunt of the damages. Weather has always been one of agriculture’s greatest variables.
Historically, El Niño has been associated with wetter conditions across portions of the southern United States, while bringing drier conditions to the Mississippi valley. It brings warmer conditions to the northwest into the plains while pushing the polar jet stream towards New England.
While we see these conditions, El Niño creates drought stress in parts of Australia, Southeast Asia, and other key agricultural regions around the world.
For grocery industry participants, El Niño rarely creates a clear set of winners and losers. Instead, it introduces another layer of uncertainty into an already complex agricultural system. Some areas get excessive rain, while others none. The common denominator is volatility.
The timing also matters. Although El Niño conditions often emerge during the spring and summer, the most consequential impacts frequently unfold months later, influencing crop production, commodity markets, and supply chains well into the following year.
This comes at a challenging timeframe for producers. Food Trade News recently highlighted expectations for rising fertilizer costs ahead of fall and winter plantings. As El Niño develops, farmers may find themselves managing another significant risk at a time when margins remain under pressure.
What El Niño Could Mean for U.S. Farmers
One of the most immediate implications may be for producers across the Southern Plains.
After years of recurring drought concerns across Texas, Oklahoma, and Kansas, climate researchers have pointed to El Niño as a potential source of much-needed moisture for the region. Increased rainfall could improve soil moisture conditions, support winter wheat production, replenish reservoirs, and provide relief for livestock operators that have struggled through prolonged dry conditions.
That would represent a meaningful development for portions of the agricultural economy that have spent much of the last decade managing drought-related risks.
However, more rain is not always better.
The South has been in drought conditions for almost six years. A season of rain might help, but it isn’t going to be a panacea. Moreover, too much precipitation can delay planting schedules, complicate harvest operations, increase disease pressure, and reduce crop quality.
Agriculture remains one of the few industries where both too little water and too much water can create significant challenges. Farmers need that goldilocks ‘just right’ zone.
A potential benefit of this weather pattern for Gulf states is a reduction in expected hurricanes and their intensity. The grocery industry should expect uneven regional winners and losers rather than universal benefits.
The Global Grocery Supply Chain Risk
The greatest concern may lie outside the United States. Many of the grocery industry’s most globally traded commodities are highly sensitive to El Niño-driven weather disruptions.
Coffee, cocoa, palm oil, sugar, rice, fruits, vegetables, and seafood production can all be affected when rainfall patterns shift unexpectedly across major producing regions. Previous El Niño events have contributed to crop shortfalls, transportation disruptions, and commodity price volatility.
For food manufacturers, this creates a familiar challenge.
Even when domestic crop conditions improve, disruptions elsewhere in the world can still place upward pressure on ingredient costs, packaging inputs, transportation expenses, and finished product pricing.
The scale of El Niño’s impact can be difficult to appreciate because its effects are dispersed across industries, regions, and supply chains. Yet the economic consequences can be substantial.
In a 2023 paper published in Nature Communications, researchers from Australia’s Commonwealth Scientific and Industrial Research Organisation (CSIRO) and their coauthors estimated that the global economy would have been roughly $2.1 trillion larger in the three years following the 1997-98 El Niño and approximately $3.9 trillion larger following the 2015-16 event if those climate disruptions had not occurred.
The modern economy and our food system is too interconnected for weather events to remain local.
Seafood & Fisheries Face Challenges from El Niño
While much of the discussion surrounding El Niño focuses on crop production and weather, some of the most immediate disruptions often occur beneath the ocean’s surface.
Under normal conditions, cold, nutrient-rich water rises from the depths of the eastern Pacific in a process known as upwelling. These nutrients support phytoplankton, which form the foundation of marine food chains and help sustain some of the world’s most productive fishing regions.
During El Niño, that upwelling weakens or can temporarily shut down altogether, reducing the nutrients available to marine ecosystems and disrupting fish populations. These effects can ripple throughout commercial fisheries.
According to NOAA Fisheries, El Niño events often cause warm-water species to migrate into new regions while cold-water species retreat northward or move into deeper waters. Schooling fish frequently disperse, and fish that remain in affected areas can experience lower growth rates, reduced reproduction, and lower survival rates.
Historically, some of the most significant impacts have occurred off the coasts of Peru and Ecuador. The anchoveta fishery off Peru – one of the world’s largest sources of fishmeal and fish oil – has repeatedly suffered during major El Niño events as warmer waters reduce nutrient availability and disrupt fish populations.
In fact, the El Niño phenomenon was first recognized by Peruvian fishermen centuries ago because of its impact on local fisheries. During El Niño years the Peruvian economy loses up to five percent of its total income due to lost revenues as a result of lower fish landings and crop yields.
Species harvested in the Pacific can experience fluctuations in abundance, while disruptions in fishmeal production can indirectly affect feed costs for aquaculture and livestock operations.
For grocery retailers and food manufacturers, these shifts can eventually translate into changes in seafood availability, pricing, and sourcing patterns. The seafood industry has seen examples of these disruptions during recent El Niño events.
NOAA scientists reported that the strong 2023-24 El Niño altered ocean productivity along the U.S. West Coast, affected salmon conditions, contributed to harmful algal blooms, and influenced fishery management decisions. Earlier strong El Niño events have also been associated with fishery closures and significant changes in species distribution.
For food industry participants, the lesson is straightforward: El Niño does not simply influence what grows on farms. It can also affect what is harvested from oceans, creating another pathway through which climate conditions can influence food supplies and prices.
Why Retailers Should Pay Attention to El Niño
A warming patch of water thousands of miles away can influence rainfall patterns, which affect crop yields, which alter commodity markets, which impact manufacturing costs, which eventually shape the price consumers pay at checkout.
The chain of events may seem indirect. Yet it is precisely how many of the most significant forces affecting the grocery industry operate. We’re looking at a real life ‘butterfly-effect’ – a concept in chaos theory describing how a small, seemingly insignificant action (like a butterfly fluttering its wings) in a complex system can trigger massive, unpredictable changes later on.
For retailers, the most important question is not whether El Niño develops, it’s how to manage consumer fallout from increased prices or out-of-stocks.
As many of our readers know too well, the grocery industry has already spent years navigating impacts from inflation, supply disruptions, labor shortages, and shifting consumer spending habits…
Like we needed another challenge.
This period of weather-driven commodity volatility could create additional pressure on categories that remain highly sensitive to agricultural inputs: Fresh produce, bakery ingredients, dairy feed costs, proteins, coffee, chocolate, and prepared foods all have varying degrees of exposure to agricultural production and commodity markets.
While consumers may never hear the phrase “El Niño-Southern Oscillation,” or know exactly what it means, they’ll doubtless experience its effects through shelf prices and supply.
Whether El Niño ultimately develops into a moderate event or a stronger one remains uncertain. Every El Niño behaves somewhat differently, and even the best weather models can’t be trusted the farther out they get. Unfortunately, the predictions based on ocean water temperatures suggest that this one could be a record-breaker.
There’s always that chance that this year turns out to be a ‘dud’ per expert predictions, but the odds are not in our favor. As the second half of 2026 unfolds, grocery executives would be wise to keep a weather eye on the horizon.
Editor’s Note: To learn more about El Niño and the companion pattern La Niña – and you like fun explanatory visuals – check out this page from the National Oceanic and Atmospheric Administration (NOAA) on El Niño.
