KEY POINT—GLAAM (which has to do with El Nino/La Nina) is acting much more like a La Nina. This is different that I thought 2 months ago. This will have some important implications for cocoa (good crops) , coffee, grains (maybe Argentina dryness later on) and perhaps energy weather in the weeks and months ahead. (more on this over the next week or so).
In the meantime, this also complicates the early winter U.S. forecast (1998 warm winter vs. 2010 a cold one).
Most studies I have done suggest temporary cold in December and not long lasting. However, given this scneario below, some colder risks will occur in the Midwest and Plains with big time snowstorms the first week to 10 days of December. THE BOTTOM LINE IS, after my high confidence back in October about a collapse in natural gas prices, the market will remain volatile the next couple weeks and possibly supported on breajs, and not as clear cut as I pointed out, weeks ago.
LOOK AT 2 DIFFERENT ANALOGS BELOW
1998 was a very warm December and 2010 was a cold one. Our original analog of 1998 has worked great for world coffee, cocoa, sugar and forecasting the warm summer for natural gas and warm fall. However, until we can dig into this a bit further—some complications and lower confidence has arisen with 2010 (cold winter) also coming up.
THE GRAPHIC BELOW FROM OUR TELECONNECTION PROGRAM SHOWS THE FOLLOWING—
The influence of a -NAO/-AO index on December temps across U.S. natural gas areas, in this case the Midwest and Plains. Notice when the NAO/AO is negative it can make a huge difference in temps.
This complicates our original forecast for a warm December a bit, even though many studies suggest cold weather will be short lived. If and when the -NAO blocks weakens, we will be the first to alert you to potentially overall warmer risks. For now, the trend is a bit colder as discussed early Friday, for December.
