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How a Very Strong El Niño Could Disrupt Latin American Trade and Exports
NOAA puts the chance of a very strong El Niño in late 2026 and early 2027 above 90%; the WMO expects it to persist through February 2027. The clearest exposure is split between drought sensitive water and transport systems—including the Panama Canal—and flood prone farms and infrastructure in parts of the Andes and...
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Key takeaways
- NOAA puts the chance of a very strong El Niño in late 2026 and early 2027 above 90%; the WMO expects it to persist through February 2027.
- The clearest exposure is split between drought sensitive water and transport systems—including the Panama Canal—and flood prone farms and infrastructure in parts of the Andes and Brazil.
- The 2023–24 event showed how drought and flooding can affect crops, shipping and food security; resilient infrastructure, early preparation and stronger recovery planning can reduce repeat damage.
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A very strong El Niño could disrupt Latin American trade through two contrasting hazards: drought that limits water for farming, power generation and shipping, and heavy rain that floods crops and damages roads and other infrastructure. The forecast calls for a powerful event, but it does not establish that any particular country or export will suffer a specific loss.
NOAA forecasts a greater than 90% chance of a very strong El Niño during the Northern Hemisphere fall and winter of 2026–27. The WMO expects the event to strengthen further, peak toward the end of 2026 and persist through February 2027.
The risks are regional, not uniform
El Niño does not bring the same conditions everywhere. Drought risk is prominent in Central America and parts of northern South America, while heavier rainfall and flooding are concerns along parts of the Pacific coast and in areas of Brazil. Those differences matter: one area may lose crops or face water shortages while another struggles with damaged roads, flooded farmland or interrupted transport. 1
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The 2023–24 event illustrated this split. The WFP reported prolonged drought and water shortages in the Central American Dry Corridor, Bolivia and Colombia, alongside intense rainfall and flooding on the coasts of Ecuador and Peru and inland Bolivia. The resulting crop risks added to food insecurity and economic hardship. 16
Trade routes can become a bottleneck
Low water can restrict traffic through the Panama Canal, a key route for international shipping. During the 2023 drought, low water levels restricted ship traffic there; drought also sharply reduced water levels in the Amazon’s Negro River and disrupted shipping near Manaus. 11
Flooding creates a different kind of interruption. Heavy rain and landslides can damage transport infrastructure and cut access to farms, mines and ports, particularly in exposed parts of Peru and Ecuador. Such disruption can delay exports even when production itself is not lost. 4
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Crops and fisheries face different pressures
Central American agriculture is exposed to drought and water shortages, with coffee and maize among the exports identified as at risk. Colombia and Bolivia also experienced drought-related agricultural impacts in 2023. 1
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In Peru and Ecuador, flooding can damage crops and infrastructure, while warm coastal waters can affect fishing. Peru’s anchovy and copper supply chains are among those flagged as exposed; the region’s broader export risks also include Chilean salmon and Southern Cone soybeans. These are areas to monitor, not guaranteed production losses. 1
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The grain outlook is not uniformly negative. Forecast conditions can differ across Brazil and Argentina, with some growing areas potentially benefiting from rain while others face drought or excessive rainfall. That variation is a reason to avoid assuming a single region-wide outcome for soy or maize. 2
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Mining and energy depend on water and reliable infrastructure
Mining, fisheries, energy and transport can all be affected by El Niño, though exposure varies by location and operation. 6 For mines, water constraints, power interruptions or damaged transport links are plausible ways a weather shock could affect production and shipments; the available evidence does not establish specific mine closures. Copper from Peru and Chile is among the region’s important exposed supply chains.
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Drought can also put pressure on electricity systems that rely on hydropower. Ecuador experienced power supply problems during the 2023–24 El Niño, when drought reduced water availability. Flooding can pose a different infrastructure risk by damaging power and transport assets. These are vulnerabilities to prepare for, not forecasts of specific blackouts. 14
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Preparedness and recovery shape the scale of disruption
Physical exposure is only part of the risk. Governance affects whether safety rules are implemented, resilient infrastructure is funded and affected communities receive support, according to a regional supply-chain risk assessment. 17
The 2023–24 impacts show why preparation matters: drought and flooding can threaten crops, water supplies, shipping and livelihoods at the same time. 16 Recovery planning can also reduce future exposure. World Bank guidance recommends using reconstruction to upgrade infrastructure and build resilience rather than simply restoring damaged assets as they were.
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For businesses and public agencies, the practical priorities are to monitor water levels on critical shipping routes, identify alternative transport and supply options, assess water and power dependencies, and plan for both drought and flooding. Which risk dominates will depend on the location and the evolution of the event—not just its forecast strength.
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What is the short answer to "How a Very Strong El Niño Could Disrupt Latin American Trade and Exports"?
NOAA puts the chance of a very strong El Niño in late 2026 and early 2027 above 90%; the WMO expects it to persist through February 2027.
What are the key points to validate first?
NOAA puts the chance of a very strong El Niño in late 2026 and early 2027 above 90%; the WMO expects it to persist through February 2027. The clearest exposure is split between drought sensitive water and transport systems—including the Panama Canal—and flood prone farms and infrastructure in parts of the Andes and Brazil.
What should I do next in practice?
The 2023–24 event showed how drought and flooding can affect crops, shipping and food security; resilient infrastructure, early preparation and stronger recovery planning can reduce repeat damage.