El Nino weather threat has eased, forecaster says
El Nino weather threat has eased, forecaster says
Bloomberg/Melbourne
El Nino weather conditions have eased in the past month, the Australian government's weather forecaster said, lowering the risk of a drought-induced slide in Southeast Asian palm oil production.
"The progress towards an El Nino event this year has slowed over the past month, as a consistent pattern of Pacific wind and cloud signatures has failed to materialize," the Commonwealth Bureau of Meteorology said in a report on its Web site.
The bureau in Melbourne said a month ago that climate indicators suggested an El Nino was close to emerging.
The weather pattern occurs when sea surface temperatures in the equatorial Pacific Ocean remain above average for more than several months.
It can trigger atmospheric and weather changes around the globe.
Palm oil prices in Malaysia, the world's top grower and exporter of the commodity, used in food preparation, rose more than 8 percent during August amid concern an emerging El Nino would bring dry weather and reduce production.
"El Nino is not likely to come and 2004 is likely to be a normal year" for rainfall, said Maruli Gultom, president of PT Astra Agro Lestari, Indonesia's biggest publicly traded agricultural company.
"This month we expect an increase in production from our Sumatra plantations because there's been plenty of rain."
Plantations in Kalimantan and Sulawesi may yield less oil than a month ago because of drier weather, he said.
"Sea surface temperatures in the western to central Pacific have hovered near El Nino thresholds for about two months now, but subsurface temperatures are well below the levels normally associated with El Nino," the Australian weather bureau said.
Palm oil for January delivery rose 27 ringgit, or 2 percent, to 1,401 ringgit on the Malaysian Derivatives Exchange at 12:29 p.m. in Kuala Lumpur.
Prices have fallen 18 percent in the past year because of record U.S. production of soybeans, a rival source of vegetable oil.