Agricultural Markets Weekly: El Niño is just starting to make its mark on agri production, with peak impact expected from 1Q27

J.P. Morgan's Agricultural Markets Weekly notes that the 2026 El Niño is rapidly intensifying, with associated rainfall anomalies typical of El Niño verifying particularly intensely in August and September and now shifting into more impactful seasonality for agricultural production. The team cautions that risk premiums may evolve across exposed agri commodity prices through 4Q26 and prominently in 1Q27, when harvests intensify and production impacts become clearer. Prominent anomalies include drought across Indonesian palm producing regions (Sumatra and Kalimantan), a below-average Southwest Monsoon across India, below-average rainfall across the East Coast of Australia and northern Brazil, and wetter-than-normal conditions across Brazil's Centre/South that are delaying the sugarcane harvest and likely reducing sugar content. NOAA's CPC projects peak intensity of the 2026 El Niño around November, with a 'very strong' event at 90% likelihood through the Northern Hemisphere autumn and wi