The World Has a $1 Trillion La Nina Problem

Deadly floods in Pakistan. Scorching heat and wildfires in the US West. Torrential rains in Australia and Indonesia. A megadrought in Brazil and Argentina.

As climate change pushes weather disasters to new extremes, it’s La Nina, an atmospheric phenomenon, that has been the driver behind the chaos since mid-2020. And now the planet stands on the cusp of something that’s only happened twice since 1950 – three years of La Nina.

Another year of La Nina means the world is hurtling toward $1 trillion in weather-disaster damages by the time 2023 wraps up. The floods, droughts, storms and fires will destroy more homes, ruin more crops, further disrupt shipping, hobble energy supplies and, ultimately, end lives.

It’s hard to imagine that all this destruction comes down to just a slight drop in temperatures way out in the gleaming blue waters of the equatorial Pacific Ocean.

Temperature anomalies in the Pacific

On a patch of ocean frequented by seals and fishing crews, less than a degree of cooling can bring on La Nina and upend the world’s weather. While the warm-cool ocean cycles have been happening for centuries, La Nina now means something more intense than ever before because of the way that climate change magnifies its calamities.

The weather cycles that come from La Nina “just exacerbate all the problems that already exist in the big picture, like the war in Ukraine and rising commodity prices,” said Michael Pento, president and founder of Pento Portfolio Strategies. “When you add in the extreme weather, it just creates a scenario for higher energy prices, higher food prices and more inflation. It’s negative for the global economy, and it’s working against the Federal Reserve.”

Odds that the cooling of the equatorial Pacific will linger through October have risen to 97%, according to a new forecast by the US Climate Prediction Center. The chances of La Nina sticking around through January are 80%.

The last string of three La Ninas was 1998-2001, and before that 1973-1976, according to Michelle L’Heureux, a forecaster and scientist specializing in the phenomenon for the US Climate Prediction Center.

But the current cycle has the potential for much more devastation because it’s happening when climate change is making the extremes more frequent and more intense.

Costs from drought, winter storms and hurricanes spurred on by La Nina can race into the tens of billions, but are so widespread they’re also hard to calculate. The best measure is through losses tabulated by insurance firms.

Weather catastrophes cost the world $268 billion in 2020, and another $329 billion in 2021, according to Aon, a data-analysis and consulting firm.

If the coming period looks anything like the chaos La Nina brought in 2020 and 2021, the total during the three-string run will likely come close to, or possibly even top, $1 trillion by the end of 2023. While some of that total isn’t tied directly to La Nina, the phenomenon, along with climate change, is what’s setting the terms.

“La Nina is like the conductor of a weather symphony,” L’Heureux said.

That weather bill, which mostly tallies property loss and crop damage, doesn’t fully capture all of La Nina’s knock-on effects. The price of everything from a cup of coffee to the coal used in steelmaking is impacted by the weather. When those costs rise, it fuels inflation. Outside of a major war, La Nina is the one event that has its thumb on the scales of global markets, industries and economies.

The cycle that brings on La Nina was first noticed by Peruvian fishermen in the 1600s, but it wasn’t fully understood until the 1960s.

Scientists are investigating whether climate change is responsible for increasing the odds for a La Nina. Richard Seager, a research professor at Columbia University’s Lamont-Doherty Earth Observatory, said he and his colleagues theorize the rise of greenhouse gases in the atmosphere is making extended, strong La Ninas more likely. Still, more research is needed to fully understand the patterns.

Here’s a look at La Nina’s recent impact across the globe

North America

Drought has spread across western parts of Canada and the US, leaving reservoirs nearly empty and causing widespread shortages of water for irrigation and hydroelectric power production

In Texas, parched conditions brought huge losses for the cotton crop, sending prices to their highest in more than a decade earlier this year.

The combination of little rain and hot weather means “2022 very well could be the next benchmark as the toughest crop-production year for the state in recent records,” said Kody Bessent, chief executive officer for Plains Cotton Growers Inc., which oversees farms across 42 counties in West Texas. “Growers will abandon more than half of this year’s crop.”

La Nina Has Exacerbated Droughts Across the US West

Atlantic Hurricanes

While La Nina is a phenomenon of the Pacific, it also impacts hurricanes in the Atlantic during August, September and October, the heart of storm season. The changing weather patterns cut off a lot of wind shear in the Caribbean Sea and elsewhere across the basin, allowing more Atlantic hurricanes and tropical storms to form and grow stronger.

In 2020, a record 30 storms formed. In 2021, there were 21, and this year forecasters are expecting well above the 14 systems that mark an average season.

Australia

Torrential rains have inundated large parts of New South Wales, Queensland and Victoria. The deluges have killed more than 20 people and damaged more than 15,000 homes, with insurance claims topping $3 billion.

Heavy showers led to quality downgrades in last season’s grain crop, and this year’s downpours have already delayed wheat and barley planting. Overflowing waters can also engulf metallurgical coal mines in New South Wales and Queensland, the world’s biggest exporter of the steelmaking ingredient.

Warm water pushed eastward by La Nina has led to the death of hundreds of small penguins that have washed up on the beaches of New Zealand.

South America

Intensely dry weather has hurt coffee, sugar and orange groves in Brazil, the world’s largest exporter of the three crops. The parched conditions are still a concern as the new coffee season gets underway, said Marco Antonio dos Santos, a meteorologist at Rural Clima. And extreme weather has also disrupted operations for the country’s iron-ore miners including Usiminas, Gerdau SA and Vale SA, the world’s second-largest producer.

In Argentina, dryness has hurt soybean and corn crops that are key to the cash-strapped nation’s trade balance. The years-long drought has also dried out the Parana River, a key shipping route. Agricultural traders and farmers have had to grapple with the extra logistics and expense of sending more exports out of alternative ports.

South Asia

Flooding has devastated Pakistan, killing almost 1,500 people and causing at least $10 billion in damage. Deluges have also ripped across Bangladesh affecting an estimated 7.2 million people, according to the International Federation of Red Cross and Red Crescent Societies. Torrential rains in India have damaged about 300,000 homes.

The weather patterns can be directly tied to La Nina, said Fahad Saeed, the regional lead for South Asia and the Middle East for Climate Analytics. “The monster flooding in Pakistan and elsewhere didn’t happen by chance.”