Strewth it’s hot. Australia is disproportionately affected by the El Niño phenomenon. So when its weather forecasters predict a growing probability that El Niño will return this year, commodity traders sit up. El Niño, a warming of the Pacific ocean in the tropics, has multiple effects. It has even been suggested that the calm waters it brings to the Pacific helped Ferdinand Magellan circumnavigate the globe in 1520. More usually, it causes drought in south-east Asia and Australia – which can ravage harvests. It also lowers the incidence of hurricanes in the Gulf of Mexico.

This has two countervailing effects on commodity markets. Fewer hurricanes mean fewer oil plant shutdowns in the Gulf – helpful for supplies and prices. But droughts can boost the price of soft commodities such as sugar, wheat and corn. There is a rough correlation between past agricultural price spikes and recent El Niño years in 2006-7, 2002-3 and 1992-3. A particularly large price effect came during the strong El Niño of 1997-8.