Ample world inventories may soften El Nino food supply shock
A super El Nino is likely to unsettle global weather and threaten food output in the coming months, but near record world inventories, expectations of near-normal conditions in some key producing regions and advanced planning could limit the fallout.El Nino, which typically brings heat and dryness to large parts of Asia and heavy rains to the Americas, is expected to strengthen, meteorologists say, potentially surpassing previous record events that devastated crops, fueled social unrest and caused tens of billions of dollars in economic losses worldwide.
“There is a bit of silver lining as far as global stocks and recent harvests of rice and other cereals is concerned,” said U.N.’s Food and Agriculture Organization (FAO) economist, Shirley Mustafa, adding world inventories are likely to cushion some the El Nino impact.The last super El Nino in 2015–16, brought droughts, floods and record global temperatures, disrupting agricultural production from Asia to Africa. Its predecessor in 1997–98 caused widespread damage, triggering devastating floods, wildfires and crop losses.But the 2026/27 episode could be different as consecutive years of record harvests have swelled global food inventories, especially in key consuming and exporting countries.Global wheat stocks are forecast to reach at 279.95 million metric tons at the beginning of the crop year on July 1, the highest in five years, the USDA data shows.Russia, the world’s biggest wheat exporter, along with other major Northern Hemisphere producers, is in the midst of harvesting a bumper crop, although concerns remain over the U.S. wheat harvest, which has been hit by a drought.
“Wheat millers in importing countries are not worried about supplies at this stage,” said one trader in Singapore. “There are no issues with supplies over the next four to six months, given the Black Sea harvest.”World milled rice reserves reached an all-time high of 196.16 million tons at the start of 2026, with India, which accounts for 40% of global exports, holding stocks at about five times the government’s target.“India imposed curbs on rice exports during previous El Nino years when production came under pressure,” said one New Delhi-based dealer with a global trade house. The sources declined to be named as they were not authorized to speak to media.“But with record wheat and rice inventories this year, the government is unlikely to restrict rice exports.”Indonesia, a key global rice importer, is also sitting on a record stockpile, with farmers racing to plant rice early to mitigate El Nino risks, officials said.The impact of El Nino will depend on how well the country prepares this year, including improvements to irrigation and water pump systems, said Sutarto Alimoeso, chief of Indonesia’s Rice Millers and Rice Entrepreneurs Association.In Thailand, the world’s third-largest rice exporter, reservoir levels are the highest in the past decade, which are likely to aid newly planted seedlings, analysts said.
Global corn inventories are projected by the USDA to reach 303.4 million tons by September 1, the highest in three years, while soybean stockpiles are forecast at 125.5 million tons, just below last year’s record of 126 million tons.“A strong El Nino forecast would have had a different impact on prices if the world supply was tight,” said Tobin Gorey, founder of commodities consultancy Cornucopia in Sydney.Chicago corn hit a nine-month low this week, soybeans slid to a four-month low and wheat was at its weakest in two months amid favourable U.S. weather and weaker oil. GRA.
