Ian Hamilton

This column is authored by Ian Hamilton, who is the founder of IDS Group. IDS provides fund administration services in Africa and Europe through Malta. He is also the founder of Scotstone Investments, a company that has fund structures and services for global emerging new managers.

There have been a number of recent articles expressing bearish sentiments on food commodity prices and predicting falling prices in the years to come. But these forecasts underestimate the effects of nature.

Global climate is becoming a factor to consider in predicting food prices and this needs to be factored into global food production, but the bears seem to be oblivious to the effect of a weather cycle unrelated to global climate change - El Nino and La Nina.

Source

El Niño is the warm phase of the El Niño Southern Oscillation (commonly called ENSO) and is associated with a band of warm ocean water that develops in the central and east-central equatorial Pacific, including off the Pacific coast of South America. ENSO refers to the cycle of warm and cold temperatures, as measured by sea temperature change (SST) of the tropical central and eastern Pacific Ocean. El Niño is accompanied by high air pressure in the western Pacific and low air pressure in the eastern Pacific. The cool phase of ENSO is called "La Niña" with SST in the eastern Pacific below average and air pressures high in the eastern and low in western Pacific. The ENSO cycles, both El N......................

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This article was published in Opalesque's New Managers a top-down monthly analysis, news and research publication on the global emerging manager space.