If you hadn’t noticed, the United States (and indeed the rest of the world) is in the grips of what the NOAA’s calling one of the strongest El Niño events on record since 1950.
An El Niño happens when westward winds in the Pacific grow weaker or even start to blow east, causing parts of the ocean to heat unnaturally. Clouds and storms follow the warm water, meaning that jet streams behave in ways they don’t normally. The upper atmosphere subsequently heats up—affecting weather all over the world.
Some areas see too much rain. The last El Niño of this magnitude in 1997 and 1998 caused a crippling ice storm in the Northeast and heavy storms from California to Florida.
Some parts of the world see far too little rain. The devastating drought in California, for example, has drained lakes, eroded land, and threatened millions of trees in 2015—in part because of warm dry weather exacerbated by El Niño. One estimate puts the economic impact on the state’s agriculture at close to three billion dollars this year alone.
Now, however, chances are good that strong, heavier-than-usual rain is on its way this winter to the West Coast, bringing with it floods, mudslides and high winds—despite the fact that even that rain won’t likely break the drought.
Is your business ready to deal with electricity outages, mudslides, closed roads and other disruptions associated with Superstorm Sandy-level flooding?
Equally strong effects on businesses around the world are likely—and not necessarily in ways you’d imagine.
For example, the coasts of California and Peru represent two of the world’s five major fishing grounds. During non-El Niño years, surface water is drawn by west-blowing winds away from these coasts, causing nutrient-rich water to rush up from the depths. This process sustains the massive fish populations that much of the world relies of for food.
In an El Niño year like this one, however, the winds weaken, and with them the outflowing currents that rejuvenate the food supply. That means the water remains nutrient-poor—and fish stocks decline.
Less fish to eat, yes… But less fish meal as well—causing a spike in the cost of feeding poultry and livestock, and higher prices at the grocery store. Businesses would be wise to prepare now for increased input costs and lower profits—or even supply chain problems as price-inelastic companies down the line struggle and founder.
It’s impossible to predict a natural disaster, for example, or a terrorist event. But there’s arguing with the fact that El Niño is here, and it’s not showing any signs of weakening for the time being.
If you don’t have a business continuity plan in place to respond to weather events or supply chain disruptions—or you haven’t updated yours in far too long—now is the time.