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El Nino is an effect of warming of the Eastern Pacific Waters which causes an effect where Southeast Asia is drier than normal.

The effect on crops and minerals around the world is as below:

·         Reduced monsoon rains in India lead to smaller output of rice and sugar crops

·         Drought in Australia devastate production of wheat and other crops

·         Warm weather in Brazil alleviate risk of frost, crop output is not reduced

·         Dry weather in Indonesia result in less water to run hydro powered mining equipment, lesser nickel output

·         Wet weather in Chile lead to flooding in copper mines, tightening supplies

El Nino may cause a 2% - 23% falls in palm oil yield due to a hindered growth of fresh fruit bunches

La Nina is an effect of the cooling of the water of Eastern Pacific Ocean which cases South East Asia being wetter than normal.

·         The effect on crops and minerals around the world is as below:

·         Higher rainfall in Australia could lead to a restocking of cattle and sheep

·         Dry weather in Argentina could reduce soybean yield

·         Lower rain in US reduce crop production

·         Colder winter in Canada and US could increase gas demand

Moderate La Nina is good for agriculture, increasing its yield but extreme La Nia will lead to flood which hampers the harvesting progress

A lack of water will affect flower formation and pollination which eventually will lead to lower fertilization and lesser fresh fruit bunch production. An excessive rain will also lead to the same result.

An excessive drought or wet period will affect a plantation FFB production 24 months down the road. We had took rainfall data at Setiawan, Perak and compare with United Plantation Berhad monthly FFB to find out the correlation between FFB production in year 2014 and Rainfall data in year 2012. The result gives us a quite positive correlation.