In the summer of 2026, people across the globe have felt the raw power of abnormal weather firsthand: Europe faced a severe heatwave, with Germany, the Czech Republic, and Poland shattering historical maximum temperature records; parts of India saw thermometers climb past 45°C, with some regions exceeding 50°C. At the same time, torrential rains and droughts appeared simultaneously in different corners of the world—the southern United States faced a high risk of heavy rainfall, while Australia and Southeast Asia braced for drought and forest fires. Behind these seemingly disconnected extreme weather events, there is one common "director"—El Niño.
One: The Origins of the "Christ Child"
"El Niño" is the Spanish term meaning "Christ Child." This romantic and somewhat mysterious name originates from fishermen along the coast of Peru in South America centuries ago. They noticed that every few years, around Christmas, an unusually warm ocean current would suddenly appear in the otherwise cold waters, causing fish populations to plummet and seabirds to die. Local fishermen called this inexplicable warm water the "Christ Child," as it arrived uninvited around the time of Jesus's birth. Today we know that the local warm current observed by those fishermen was a microcosm of a much larger climate phenomenon. El Niño refers to the persistent abnormal warming of sea surface temperatures across a vast area of the central and eastern equatorial Pacific. The "Niño 3.4" region, used solely to monitor this phenomenon, spans roughly 6 million square kilometers—about two-thirds the size of China's land area. One can imagine the global climate shock that such a massive area of ocean "running a fever" can cause.
Two: Normal State vs. El Niño: From "Seesaw" to "Slide"
To grasp El Niño, one must first understand what the Pacific looks like in a normal year. Under typical conditions, sea surface temperatures in the equatorial Pacific exhibit a "west warm, east cool" pattern. The southeast trade winds blow steadily from east to west across the Pacific, acting like a giant hand that pushes warm surface water from the eastern Pacific (off Peru's coast) toward the western Pacific (near Australia and Indonesia). As the warm surface water is blown away from the east, deeper cold water rises to replace it, a process known as "upwelling." This upwelling brings not only cold water but also abundant nutrients, which is why the Peruvian fishery is world-renowned. Meanwhile, a massive atmospheric circulation loop exists above the equatorial Pacific—warm, moist air rises over the western Pacific, flows eastward at high altitudes, sinks over the eastern Pacific, and returns westward along the surface. This cycle is called the Walker Circulation.
However, in certain years, the trade winds inexplicably weaken or even reverse direction. Without the westward push, the warm water that typically accumulates in the western Pacific begins to flow back eastward. The eastern Pacific surface becomes covered with warm water, deep cold water can no longer upwell, and sea temperatures rise continuously. As the east warms, the temperature difference between the eastern and western Pacific narrows, reducing the driving force behind the trade winds and making them even weaker; the weaker the winds, the more warm water drifts eastward... This self-reinforcing loop continues until El Niño is fully formed.
Three: How Is El Niño Determined?
Meteorologists have clear quantitative standards for defining El Niño. According to the national standard "El Niño/La Niña Event Identification Method," an El Niño event is confirmed when the sea surface temperature index in the central-eastern equatorial Pacific reaches or exceeds 0.5°C for a three-month moving average, sustained for at least five months. If the peak intensity reaches or exceeds 2.5°C, it is classified as a super El Niño event. The year 2026 is witnessing a developing super El Niño event. Monitoring shows that the central-eastern equatorial Pacific entered an El Niño state in May 2026. The sea temperature index in the monitoring region reached 2.09°C in July and climbed further to 2.64°C in the first half of August. The National Climate Center projects that this event will peak around November to December 2026 and is highly likely to become the strongest on record. Forecasts from the World Meteorological Organization (WMO) also indicate an 80% probability of El Niño conditions from June to August 2026, with the likelihood of persistence through November near or above 90%.
Four: El Niño and the ENSO Cycle
El Niño does not exist in isolation. In the equatorial Pacific, there is a regular, natural pattern of variation between the ocean and atmosphere, known as the "El Niño-Southern Oscillation" (ENSO)*. ENSO has three phases: the warm phase is El Niño (abnormal warming of eastern Pacific waters), the cold phase is La Niña (abnormal cooling of eastern Pacific waters), and a neutral state in between. These phases alternate with an average cycle of about 2 to 7 years. El Niño typically lasts 9 to 12 months, while La Niña can sometimes persist for up to three years. Note: The Southern Oscillation refers to the anti-phase pressure oscillation between the southeastern Pacific and the Indian Ocean/Indonesia region. The Southern Oscillation is the atmospheric component of ENSO—it manifests as a "seesaw" pressure oscillation between the Pacific and the Indonesia-Australia region. When pressure in Tahiti is lower than in Darwin, it often corresponds to the onset of El Niño. The oceanic El Niño and the atmospheric Southern Oscillation combine to form the complete ENSO system.
Five: How El Niño Disrupts Global Climate
El Niño garners so much attention because it can influence weather patterns across most of the globe. Its core impact lies in releasing vast amounts of heat into the atmosphere, altering the Walker Circulation over the equatorial Pacific, and consequently disrupting global atmospheric circulation. Heatwaves are the most widespread effect. The high temperatures seen in many parts of the world during the summer of 2026 are, to a large extent, the result of El Niño's rapid development. Heavy rains and droughts arrive simultaneously—El Niño causes flooding in some regions while leaving others bone dry. Specifically, the west coasts of South America, such as Peru and Ecuador, face flood risks, the southern United States sees increased rainfall, while Australia, Southeast Asia, and India may experience drought. El Niño can also lead to the collapse of the Peruvian fishery and disrupt global agricultural production—studies suggest that wheat yields may drop by 35% to 45% in El Niño years.
Six: El Niño's Impact on China
Although El Niño occurs in the distant Pacific, its impact on China's climate is equally significant. Since the summer of 2026, China's climate has exhibited typical characteristics of the developing phase of El Niño: two north-south rain belts in the east, with widespread and intense rainstorm events and overlapping affected areas; active typhoons with greater intensity and prolonged wind and rain impacts. The underlying mechanism is that El Niño causes the western Pacific subtropical high and the monsoon trough to shift further north and strengthen, combined with frequent intrusions of cold vortices at high altitudes from the north, forming two north-south rain centers. With the enhanced summer monsoon, typhoons in the northwestern Pacific and the South China Sea increase in number and intensity. Additionally, past El Niño events during winter have often led to colder Arctic springs in the following year; however, since the 1980s, this relationship has reversed, with El Niño now more likely to cause warmer Arctic springs, potentially increasing the risk of "cold snaps in late spring" in China.
Seven: How El Niño Affects Agricultural Chain Investment Logic
El Niño's impact on the A-share agricultural planting chain has a clear transmission pathway: extreme weather leads to reduced crop yields in major producing areas, which in turn raises global agricultural price expectations, ultimately improving the profit outlook for companies in the planting chain. Different commodities are affected in varying ways. Perennial cash crops in Southeast Asia, such as palm oil and natural rubber, are more certain to suffer from drought, with notable yield declines observed in historical strong El Niño events. South American soybeans and corn, which coincide with the planting season during El Niño's peak, may see bumper harvest expectations reversed due to flooding. Sugarcane in major producing countries like India and Thailand faces drought threats, and combined with export restriction policies, could alter the global sugar supply-demand balance. Driven by production reduction expectations, futures prices for related agricultural products often react first. The rise in the A-share planting chain is not purely speculative. The current valuation of the sector and institutional holdings are both at historical lows, resonating with rising grain price expectations. Additionally, the accelerated expansion of technologies such as biological breeding provides extra growth logic—extreme weather may hasten the adoption of high-yield, stress-resistant varieties, pushing the industry from a cycle-driven model toward technological upgrading. However, it should be noted that whether grain price rise expectations will materialize remains uncertain, and corporate profit improvements often lag, creating a time gap between short-term sentiment and fundamental improvements, so investors should remain rational.
For those looking to position in the A-share agricultural chain, attention can be focused on the Agricultural, Animal Husbandry & Fishery ETF Huabao (159275). According to China Securities Index Company statistics, the Agricultural, Animal Husbandry & Fishery ETF Huabao (159275) passively tracks the CSI All-Share Agricultural, Animal Husbandry & Fishery Index, with weight stocks including leading companies in core segments of the planting chain such as seed industry and agricultural product processing, also covering major sub-sectors of the agricultural, animal husbandry, and fishery industry chain such as feed, animal protection, and pig farming. Off-market investors can also gain exposure to the agricultural, animal husbandry, and fishery sector through the Agricultural, Animal Husbandry & Fishery ETF feeder fund (Class A 013471, Class C 013472).
Eight: Final Thoughts
El Niño is a natural phenomenon whose periodicity and regularity have long been recognized by the scientific community. However, in the context of global warming, El Niño's impacts are being amplified. Research indicates that current climate warming has already magnified ENSO's influence on global temperatures and extreme precipitation. Super El Niño events could trigger more sudden changes in the climate system under the backdrop of warming. As the Secretary-General of the World Meteorological Organization stated, the arrival of El Niño is an urgent climate warning. Understanding El Niño, monitoring El Niño, and responding to El Niño require not only the efforts of scientists but also the attention of every ordinary person who cares about the planet we live on. When the "Christ Child" in the Pacific stirs restlessly, no one is truly a bystander.
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