Updated climate models point to an exceptionally intense El Niño forming in the second half of 2026, with the European Centre for Medium-Range Weather Forecasts (ECMWF) projecting sea-surface anomalies of up to 3.2 degrees Celsius in the Niño 3.4 region of the central Pacific by year-end, above the 2.8 degrees seen in the April outlook and matching the most extreme events on record since the 19th century. Brazilian analysts estimate the climatic factor alone could add 0.8 percentage point to a 2026 inflation forecast already running at 4.89%, while the next planting cycle for soy and corn enters the highest-risk window since 2015-16.
Key Points
— ECMWF May 1 update raises Niño 3.4 anomaly projection to about 3.2 degrees Celsius by end-2026, up from 2.8 in April
— NOAA’s Climate Prediction Center puts El Niño formation probability at 61% for May-July, with the event likely to persist through end-2026
— Brazilian inflation projection at 4.89% in the May 4 Focus survey; analysts say a strong event could add up to 0.8 percentage point
— Andean hydropower exposed: Peru, Ecuador and Colombia generate over 60% of electricity from hydro, with Colombia’s firm-energy deficit already at minus 2.3% for 2026
— The Rio Times, the Latin American financial news outlet, reports the forecast as the Copom resumes Selic cuts and food prices remain the dominant inflation risk
A Forecast at the Edge of the Modern Record
The ECMWF ensemble now places nearly every model member in the very-strong-event territory of plus 2 to plus 4 degrees Celsius for the second semester of 2026, an outcome MetSul Meteorologia’s Luiz Nachtigall calls capable of rivalling or surpassing the historic 1997-98 event that peaked at about 2.8 degrees Celsius in the same Niño 3.4 zone. Paul Roundy of the State University of New York at Albany told media that confidence is rising for “potentially the largest El Niño event since the 1870s,” a 150-year horizon that frames the magnitude of what is being modelled.
NOAA’s May 4 bulletin formalized the shift, transitioning the agency’s outlook from a “final La Niña advisory” to an “El Niño watch.” For the November 2026 to January 2027 window, NOAA assigns similar probabilities to moderate, strong, and very-strong outcomes, while Brazil’s Inmet meteorological service puts the chance of El Niño exceeding 90% in the second semester of 2026. Subsurface Pacific waters already register up to 8 degrees Celsius above the historical mean in some sectors, supplying the thermal fuel the surface layer will draw on as the event consolidates.
Brazil: 2026/27 Safra Enters the Risk Window
For Brazil, the dynamic typically splits the country in two: heavy rains and flooding risk across the South, drought in the North and Northeast, and irregular precipitation through the Centre-West and Southeast. The 2026/27 grain cycle is the exposed harvest, with planting decisions for soy and corn taken from October. Carolina Giraldo at StoneX framed the central question as one of distribution rather than volume, saying that the irregularity of rainfall in space and time remains the principal challenge for Brazilian agriculture in the short term.
Historical reference points are sobering, with Brazilian grain output falling 9.5% under the strong 2015-16 event and corn dropping 19.1%, while the 1997-98 event killed about 21,000 people globally and caused 35 to 45 billion dollars in damages worldwide. More recently, the 2023-24 cycle pushed Brazilian freight costs up by as much as 57% as Amazon-basin rivers fell to navigation-blocking lows and torrential rain damaged Southern highways, and the same event added 2.25 percentage points to in-home food inflation across 2024, according to FGV-Ibre data. The macro context for 2026 is captured in Rio Times’s Brazil agribusiness 2026 guide.
Inflation Channel and the Copom
| Indicator | Value |
|---|---|
| ECMWF Niño 3.4 anomaly by end-2026 | ~3.2 degrees C (was 2.8 in April) |
| NOAA El Niño formation probability, May-July | 61% |
| Brazil 2026 IPCA inflation forecast (Focus, May 4) | 4.89% |
| Maximum climate add-on flagged by analysts | +0.8 pp |
| Selic policy rate after May cut | 14.50% |
| 2015-16 El Niño impact on Brazilian grain output | -9.5% (corn -19.1%) |
The Banco Central do Brasil’s Copom delivered a 25-basis-point cut at its last meeting, taking the Selic to 14.50%, even as the Focus survey logged its eighth consecutive weekly upward revision of the 2026 inflation projection. André Braz, FGV-Ibre’s price-index coordinator, said the food-price increase tied to El Niño was already baked into the outlook before the Iran conflict added an oil-price layer, meaning the climate channel is additive to, not a substitute for, the energy channel hitting headline inflation. For investors tracking the rate path, the Copom’s next meeting on June 16-17 will weigh how much of the climate risk to absorb into projections.
LATAM Asymmetry: Andean Power and the Cono Sur
The impact pattern across Latin America divides sharply. Argentina, Uruguay, Paraguay and Brazil’s South typically benefit from rainfall above normal, a partial tailwind for the Argentine pampa where the Bolsa de Comercio de Rosario noted soil moisture has recovered after 2025 rains; the soy and corn campaign starting in October 2026 enters the Pacific-influenced window. Centroamerican coffee, sugar and corn producers in the Corredor Seco face the opposite risk of acute drought, a pattern documented across past events by the IFRC.
The Andean countries carry the heaviest hydropower exposure: Colombia generates roughly 70% of its electricity from hydro and entered the year with a firm-energy deficit of minus 2.3% for 2026, a structural shortfall Rio Times analyzed in coverage of the Colombian Acolgen electricity warning. Ecuador’s Cenace risk model assigns a 17% probability of power deficit during the October 2026 to March 2027 dry season; Peru’s Pacific coast historically faces flood and landslide risk from El Niño-driven rainfall, with damage to coastal infrastructure and fisheries the principal transmission channel. The full LATAM mapping is set out in Rio Times’s deep El Niño 2026 LATAM economy analysis.
What to Watch
- ECMWF June 1 update: a further raising of the Niño 3.4 anomaly projection would lock in the Super El Niño scenario; a softening to plus 2.5 to 2.7 degrees would put the event closer to 2015-16 than 1997-98.
- Copom June 16-17 decision: how the Selic communiqué treats food-inflation risk will signal Banco Central tolerance for climate-driven price pressure.
- September-November 2026 window: MetSul flags this trimester as the highest-risk for extreme events; soy planting decisions in the South and Centre-West will be made before the peak.
Frequently Asked Questions
What makes this a “Super” El Niño?
Forecasters reserve the informal label “Super El Niño” for events where the sea-surface temperature anomaly in the Niño 3.4 region of the central Pacific exceeds about 2 degrees Celsius above the historical average. The ECMWF May 1 projection of up to 3.2 degrees Celsius places the 2026 event near the top of records dating to the 1870s. Only three events since 1950 have crossed the threshold, with 1997-98 the most-cited reference at about 2.8 degrees.
Which Brazilian crops are most exposed?
Soy and corn carry the largest direct risk because they are sown between October and December across the Centre-West and South, the same window when El Niño rainfall asymmetry peaks. Sugarcane, coffee and beans face secondary exposure. In the 2015-16 event Brazilian grain output fell 9.5% and corn alone dropped 19.1%, the historical benchmark for what a strong event can do to Brazilian planting calendars.
How does the climate risk reach the inflation print?
Three channels: lower productivity raises wholesale grain prices, supply disruption on Amazon-basin rivers raises freight costs by up to 57% in severe events, and El Niño-driven drought in the Andes reduces hydropower output and raises regional energy costs. FGV-Ibre’s André Braz says food prices alone could add 0.8 percentage point to Brazil’s 2026 IPCA print, which the May 4 Focus survey put at 4.89%.
Will Argentina benefit?
Argentine forecasters at the Bolsa de Comercio de Rosario caution the country is not guaranteed a windfall: rainfall above normal in the pampa often supports soy and corn yields, but a model called for in 2023-24 included a one-month dry spell during a critical soy window despite an active El Niño. Soil moisture entered May 2026 in better shape than the prior 3 years, but flooding and logistics-disruption risk remains the chief downside.
Updated: 2026-05-11T18:00:00Z