The ripple effect of El Niño: What does it mean and how does it impact the world's economy?
FOX Weather Meteorologist Steve Bender spoke to Phil Flynn, contributor for FOX Business Network, about this phenomenon and how it affects a lot more than we may think.
El Niño's ripple effect: How it impacts the economy across the world
El Niño doesn't just affect the weather, it brings chaos to markets all over the world by creating drought, which limits food resources, which drives up import and grocery prices. It's what's called a "ripple effect." FOX Business Contributor Phil Flynn talks about the ripple effect with FOX Weather Meteorologist Steve Bender.
El Niño is in full swing, and while we've seen its impacts on hurricanes, both with an overactive season in the Pacific and an underactive season in the Atlantic, its impacts are far wider than just the weather.
Like many things, El Niño causes something called a "ripple effect" on the world's economy.
AUSTIN, TEXAS - MAY 11: Produce is displayed for sale at a Target store on May 11, 2026 in Austin, Texas.
(Brandon Bell/ / Getty Images)
FOX Weather Meteorologist Steve Bender spoke to Phil Flynn, contributor for FOX Business Network, about this phenomenon and how it affects a lot more than we may think.
Crops, production and El Niño
"Anybody that's bought a cup of coffee has noticed that the prices have been edging up," Flynn said.
He said cacao is another crop that's been affected, hence the recent spike in prices for Halloween candy.
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"El Niño has had a major impact on those crops, it's driving it up, but it even goes beyond that," Flynn said.
A field of failed corn crops due to drought at a farm in Glendale, Zimbabwe, on Monday, March 11, 2024.
(Cynthia R Matonhodze/Bloomberg / Getty Images)
He explained that extreme weather in places that don't usually experience it, i.e. flooding, drought, etc., will have an impact on commodities in that area.
"Here in the U.S., we're seeing a really good crop," Flynn said. "A near record crop for soybeans and corn. That's partly El Niño because the weather was perfect for the growing season."
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What happens next after the crops leave the field is to be determined, but Flynn said recent years' droughts have led to farmers culling their cattle, meaning the U.S. is at a low for cattle crops.
Packages of pasta are displayed on fully stocked retail shelves inside a Walmart supermarket store aisle in American Fork, Utah, United States, on October 29, 2026. (Photo by via Getty Images)
(Charles-McClintock Wilson/NurPhoto / Getty Images)
He said this year they might have the ability to feed cattle more, but it could take months or years to rebuild cattle herds to levels seen before.
What impacts will extend this winter?
El Niño is likely to become stronger than ever this winter, so it will also have an impact on the insurance industry.
A warmer, wetter winter is likely to mean more flooding in places where flood insurance may not be a thing.
Houses In Geneva on Mullet Lake Park Road, are inundated by floodwaters from the St. Johns River after historic levels of rainfall from Hurricane Ian in 2022.
(Joe Burbank/Orlando Sentinel/Tribune News Service / Getty Images)
On the other hand, in places that are normally significantly impacted by hurricane season, like Florida, home insurance prices are trending down, Flynn said.
He said the natural gas futures are also showing a strong El Niño impact.
People are also betting that natural gas prices will drop, as a warmer winter means less natural gas use in some places.
What's the big picture?
With all these impacts, you might expect that one group might see harsher impacts than others, but Flynn said that's not the case.
He said everyone is facing some struggle or another due to rising costs for both the consumer and the producer.
S&P 500 market information after a Federal Open Market Committee (FOMC) meeting on the floor of the New York Stock Exchange (NYSE) in New York, US, on Wednesday, Oct. 28, 2026.
(Michael Nagle/Bloomberg / Getty Images)
"This El Niño probably could have more impact, I think, on any weather event around the globe than I've ever seen in my lifetime," Flynn said.
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He said, regardless, people in the business and markets will be watching to see how Super El Niño plays out this winter.