Elgrey's  Instablog

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Expat finance professional living and working in Hong Kong.
  • El Nino Further Impact 0 comments
    Jul 15, 2014 4:42 AM

    A few weeks ago I wrote on how commodities react on El Nino during early stages - summer. Now I want to cover next stage - next 4 months up to the end of December. As before only 4 years - 1982, 1986, 1997, and 2009 will be reviewed and the precautions against results need to be the same - remember, this is a small selection for statistical purposes, expiration bias is possible, past performance is not indicative blahblah and so on...

    OK, results:

    Grains - wheat and corn declined and rose equal number of times. Soybean group (beans, meal, oil) rose 3 time vs 1 decline. I'd say this is rather neutral result. However, assuming this year's drastic drop of beans I do not rule out that the score will be 4vs1 in near future.

    Softs - cotton and cocoa made 3 declines vs 1 growth, coffee was even, orange juice was 3 times green and 1 time red.

    Petroleum group and natgas were even. Metals too.

    Conclusion - there is no clear impact no matter what crowd thinks. One more proof to abandon herd mentality and use own brain.

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