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UBS Warns El Nino May Intensify Food Inflation Across Asia

Zero Rss
2 weeks 1 day ago
UBS Warns El Nino May Intensify Food Inflation Across Asia

By now, readers have a clear understanding that the Gulf-driven energy shock is on course to collide with a potential super El Niño weather event, creating what could be a dangerous second-order shock to food supply chains around the world.

The concern is that extreme heat and disrupted rainfall patterns could hit top agricultural growing belts, dent harvest output, and amplify existing supply stress. Even before those weather-driven impacts fully materialize, global food prices are already rising, suggesting that fertilizer and elevated diesel prices are beginning to be transmitted through the broader food supply chain.

Our Tuesday note on Thailand white rice, a regional Asian benchmark, surging 20% in May, the largest monthly increase in data going back to 2008, is another warning signal that the price action in the grain feeding half the world has entered a new upward impulse.

The troubling move in rice prices, including a 15% surge in Chicago rice futures last month, indicates that food-inflation pressures are already materializing. The concern is that these pressures could materially worsen once El Niño-driven weather disruptions begin affecting key growing regions.

UBS analysts led by Leigha Miyata published a note titled "Food Inflation & El Niño Evidence Check," confirming what we have been tracking for months: the Middle East-driven fertilizer shock is now moving through the global food supply chain just as El Niño risks rise, creating the potential for an inflation surge across Asia later this year into 2027.

Miyata noted that El Niño odds currently stand around 82% for May to June and 96% for December into early 2027, raising the risk of hotter, drier conditions across South and Southeast Asia that could pressure harvests.

Via Miyata ...

El Niño likelihood raised to 82%; expect Asia to be hotter and have less rain:

The El Niño is likely to emerge soon (82% chance in May-July 2026) and continue through Northern Hemisphere winter 2026-27 (96% chance in Dec 2026-Feb 2027, NOAA). Historical patterns show higher temperatures in Indonesia and northern Australia (Figure 1). Temperatures are normally lower in South Korea and Japan, though a "super El Niño" could reverse this, bringing intense heat and rainfall. Precipitation is lower in South and Southeast Asia, posing risks to harvests (Figure 2). Other El Niño impacts include higher power demand, lower supply, and increased disease risk (see p3).

Fertilizer Prices - Urea prices correcting, now +23% since the Iran conflict started:

Though nitrogen supply remains tight, we have seen diverging trends in the last few weeks on the product level. Ammonia pricing has been stable to higher, UAN pricing has been stable, while urea pricing has seen downward corrections, $190/MT (~23%) lower than its peak level in April. Overall the UBS chemicals team see this pointing to the market having moved past peak seasonal tightness, with 2Q likely marking the high point. We believe structurally tight supply from restricted trade flows and constrained production will continue to support the pricing outlook for 2H26/2027 above the cost curve however, and note that physical market flows have yet to improve (full report).

Gov't measures have been helpful, but inflation is rising across Asia:

The FAO Food Price Index averaged 130.7 points in April 2026, up 1.6% from March, marking a third consecutive rise but at a slower pace. Gains in vegetable oils, meat, and cereals were partly offset by declines in sugar and dairy. The index was 2.0% higher year-on-year but remained 18.4% below its March 2022 peak. Inflation across all major Asian economies is increasing with the exception of Indonesia and Japan, and corn futures for 2026/2027 are up ~4%/5% since the Iran conflict started. UBS economists explain that inflation was likely lower in many Asian economies due to quick policy-action post Iran conflict, but that inflation will likely rise going forward (full report). In the Philippines, the level of inflation has shot up from 2.3%/3.9% in Feb/Mar to 7.1% in Apr. In Thailand, deflation in Feb/Mar has shifted to 2.9% inflation in April (Figure 5). For Japan, there are no clear signs yet of strong inflationary pressure from Middle East tensions. However, we expect national CPI for May to pick up slightly to 1.5% from 1.4% in April, suggesting April was likely the trough. Food inflation in Japan decelerated from 4.6% YoY in April to 4.1% YoY in May, though on a MoM basis, food inflation rose 0.3% (full report).

Packaging and freight costs are up; El Niño in 2026-27, fertilizer impact in 2027:

Plastic packaging prices in Japan are reported to be up 20 to 30%. This together with transport costs are expected to raise food prices, but this is not yet visible in the data for Japan. If El Niño materializes, we may see drought impact the harvests in Sep 2026- and Apr 2027- in South and Southeast Asia. Higher fertilizer costs may also affect harvests from April 2027 onwards.

UBS views on El Niño impacts

1. Agri-business: Tightening global balances and large speculative shorts mean an El Niño-driven disruption to India's monsoon could reduce sugar production by ~3–8mn tons YoY and trigger price spikes.

2. Agriculture & Inflation (India): El Niño-driven weak monsoon risks (forecast ~92% of normal rainfall) could lift food inflation, though only ~21% of CPI is directly impacted, limiting first-round effects but raising second-round risks if shocks persist.

3. Health Care (Brazil): El Niño-driven changes in mosquito patterns could increase dengue cases, with prior events (2023/24) coinciding with record infections (~6.6mn cases).

4. Thermal coal / Power demand: A potential "super El Niño" could drive extreme heat across Asia, boosting electricity demand (especially for cooling) and increasing coal demand and imports, tightening seaborne markets.

5. Hydropower / Power supply: El Niño-related rainfall shifts could reduce hydro generation in LatAm and Africa, further supporting demand for thermal coal.

6. Insurance / Reinsurance: El Niño conditions are associated with below-average hurricane activity, which could improve insurers' near-term book value but pressure pricing due to increased capital supply. In Australia, El Niño years tend to have lower catastrophe losses, though drought and bushfire risks rise.

Figure 6: Real GDP growth %y/y: pre- and post-Iran conflict

Figure 7: Asia's inflation likely to pick up on base effects

Figure 12: Energy/fertilizer shock impact chain

Figure 13: Thailand and India are likely to be negatively impacted in APAC. All importers, including Japan will face higher prices

Related:

Last month, ZeroHedge Debates held a roundtable to ask, "How bad will the food inflation mess get?"

Professional subscribers can read the full "Food Inflation & El Niño Evidence Check" here at our new Marketdesk.ai port.

Tyler Durden Thu, 06/04/2026 - 05:45
Tyler Durden

BBC Sinks To A New Low...

Zero Rss
2 weeks 1 day ago
BBC Sinks To A New Low...

Authored by Steve Watson via Modernity,

The BBC has once again demonstrated its role as a partisan propaganda machine rather than a neutral public broadcaster.

On its flagship evening news show Newsnight, presenter Matt Chorley repeatedly claimed Reform UK leader Nigel Farage called for a "white cold rage" in response to the murder of 18-year-old student Henry Nowak.

Yet Farage said no such thing. He called for "pure cold rage" - a measured, determined pushback against institutional failures and anti-white bias in policing and justice.

The BBC had just sunk to a new low.

On Newsnight last night, presenter Matt Chorley claimed Nigel Farage said people should respond to the murder of Henry Nowak with "white cold rage".

Nigel DID NOT SAY THIS.

The insertion of the word "white" by the BBC is obviously... pic.twitter.com/OwFxXNUy5N

- Zia Yusuf (@ZiaYusufUK) June 3, 2026

Chorley repeated the fabricated racial angle three times. The insertion was no accident. It transformed a call for equal justice and accountability into something that could be painted as divisive racial incitement.

When caught, Chorley issued a tepid apology on X, claiming a "misremembering" while insisting it "didn't change the content of the interview."

I owe Nigel Farage an apology.

During last night's Newsnight we covered the murder of Henry Nowak and the political reaction to the case, including discussing Nigel Farage's comments about "pure, cold rage".

However I referred to "white cold rage". This was a mistake on my part, a misremembering of the quote. It didn't change the content of the interview but I should have got the quote right. I apologise to Nigel Farage for this.

- Matt Chorley (@MattChorley) June 3, 2026

Critics across the board rejected that claim outright.

Of course it changed the content of the interview, it added racially inflammatory comments where there were none. You'd never have made a similar revealing slip THREE times using black instead of white.

Reflects your innate bias and that of the BBC.

And I don't trust Farage...

- Mark Kingsley-Williams (@Mark_A_K_W) June 3, 2026

Pure cold rage became "white cold rage" because the institutional mindset equates any pushback against two-tier standards with whiteness.

Completely unacceptable. Nigel Farage said "pure cold rage" and the BBC decided to report it as "white cold rage".

This is why fewer and fewer people trust the BBC. They created BBC Verify to counter misinformation, but they are the biggest culprits of misinformation. https://t.co/DRFJiCc209

- Chris Rose (@ArchRose90) June 3, 2026

Fuck off. You knew EXACTLY what you were doing.

Stop taking us for fools. We're sick of it, Matt.

- Professor Dr King Mike ? (@MikeSouthWestUK) June 3, 2026

If GB News did this to a left wing politician Ofcom would have raided the building by now.

Will the BBC be taken off air?

During a crucial byelection too. https://t.co/jFVGmDa9sh

- Zia Yusuf (@ZiaYusufUK) June 3, 2026

A full on-air correction and explanation of what Farage actually said is the minimum standard for any credible outlet. The pattern of one-directional "mistakes" - always inflating racial angles against critics of mass immigration, DEI, or institutional bias - tells its own story.

The Henry Nowak case has exploded back into the headlines following the release of the horrible Bodycam footage of the incident and the trial of his murderer. Nowak lay on the ground bleeding heavily, repeatedly telling officers "I've been stabbed" and "I can't breathe." Instead of providing urgent medical aid, officers dragged him across gravel, handcuffed him, and initially treated him as a suspect based on Digwa's false racism allegations and minor complaints about a swollen eye.

Digwa was not handcuffed at the scene. His family stood over the dying victim pushing the race narrative. Hampshire Police's initial statement claiming quick life-saving measures was later deleted once the footage emerged. Protests followed the footage release. Some turned violent in Southampton last night, with clashes injuring officers.

This latest incident fits the established pattern of BBC editorial choices that downplay or twist stories challenging progressive narratives on policing, identity politics, and institutional bias. Previous coverage on the same programme saw presenter Victoria Derbyshire act surprised when an ex-cop refused to excuse the initial response to Nowak. The discomfort was palpable as facts about prioritising a false racism claim over a dying victim's pleas were laid out.

An ex-police officer appearing on BBC Newsnight described the response as "unfathomable." Basic procedure demands prioritising medical assessment for anyone reporting stab wounds and bleeding out, not handcuffing or accepting unverified claims from the attacker. The Independent Office for Police Conduct is investigating. Nowak's father demanded transparency, stating his son "did not die with dignity" and that being read his rights was among the last things he heard while dying.

The BBC consistently frames cases involving white victims and minority perpetrators through a lens that protects DEI-influenced institutions while pathologising any demand for colour-blind standards.

The "white cold rage" fabrication is the latest example of this reflexive racialisation - turning legitimate fury over two-tier policing into a smear. It mirrors broader BBC output that has portrayed Islamist issues sympathetically, pushed contested social agendas, and faced lawsuits over distorted editing, including the ongoing Trump case. The organisation's charter obligations on impartiality appear secondary to its institutional worldview.

Farage's actual words on the Nowak case called for cold, principled determination to restore equal treatment before the law - not hot-headed violence or racial payback. The BBC's version injected race where Farage spoke of universal standards trashed by fear of labels. That single word change reveals more about the presenter's and the organisation's priors than about Farage.

We also knew this would be the leftist establishment playbook in the Nowak case when it finally received the attention it warranted.

Public trust in the BBC continues to erode precisely because of episodes like this. Licence fee payers subsidise an outlet that treats one side of the political spectrum as requiring constant racial vetting while giving institutional failures a pass.

Reform voices and ordinary citizens demanding accountability for the Nowak case and similar incidents are not the problem. The problem is an entrenched media class that cannot report straight when the facts challenge their worldview.

The weak apology changes nothing substantive. Full transparency, on-air correction, and serious consequences for editorial failures would be the start of rebuilding credibility. Until then, the BBC remains what its actions show it to be: a publicly funded vehicle for advancing selective narratives rather than pursuing truth.

Those who value free speech, equal justice, and genuine accountability know the only long-term answer involves stripping away its compulsory funding and letting it compete in the open market like every other outlet.

Tyler Durden Thu, 06/04/2026 - 05:00
Tyler Durden

Germany, France, UK See Opportunity To Revive Putin Talks Without Washington

Zero Rss
2 weeks 1 day ago
Germany, France, UK See Opportunity To Revive Putin Talks Without Washington

Europe's most influential powers of Germany, France, and the United Kingdom are trying to again jump-start Ukraine war peace talks, collectively operating as the E3 group.

They seek to implement a new framework aimed at engaging Russian President Vladimir Putin in direct negotiations to end the war. Reuters on Wednesday reports that "A window for dialogue is slowly opening between Russia and Europe on Ukraine, ​although it is likely to be months before talks can ‌begin, a German government official said at a briefing on Wednesday."

It seems this window of opportunity is based to some degree on perceptions that the war tide and momentum is finally shifting in Ukraine's favor, given the increasing effectiveness of Ukraine's devastating cross-border drone attacks of late.

European leaders apparently view the current battlefield and political dynamics as having strengthened Kiev's bargaining position, creating what they believe is the optimal moment to press Moscow for talks.

Zelensky himself is suddenly talking about directly engaging Putin this week, saying that he's 'ready' to go to the table:

🇺🇦🇷🇺Zelensky just went nuclear on the wait-and-see game:

“I’m ready for direct negotiations with Putin RIGHT NOW! Not sitting in line while the world finishes every other war first.”pic.twitter.com/yLEkLAc9zD

— Mario Nawfal (@MarioNawfal) June 3, 2026

The groundwork was reportedly laid in late May, when Zelenskyy sat down for a high-stakes meeting with French President Emmanuel Macron, UK Prime Minister Keir Starmer, and German Chancellor Friedrich Merz.

The leaders have sought to revamp the entire Western negotiation strategy, presenting a fiercely united European front, at a moment the Trump administration is seen as on the sidelines, or even perhaps ambivalent and apathetic to the question of Ukraine peace.

The EU has been pushing back against external influence on selecting negotiators for peace talks, and apparently trying to wrest any potential peace framework from Washington influence. It was the US leading the way on this, but nothing has happened especially since the Iran war took prominence in the US administration's thinking.

Europe's traditional power brokers are desperate to prove they still hold the leverage to dictate the terms of their own backyard security. Whether Putin feels any compelling reason to play ball with the E3 framework remains an entirely different question of course.

But according to more from Reuters, "The German official said recent fighting indicates it is likely to take months, rather than weeks, to reach a point where ​talks could begin, and ​that it was ⁠key to ensure they were conducted in full agreement with Ukraine."

//--> Russia x Ukraine ceasefire agreement by October 31, 2026?
Yes 30% · No 71%
View full market & trade on Polymarket

So for now it seems the battlefield will continue to determine who has the leverage or not, as each continues inflicting more and more pain on the other. Russia's aerial attacks on Ukrainian cities have only grown more deadly and expansive. The same cam be said for Ukraine's cross-border drone attacks on Russian territory, which on Wednesday wreaked havoc on St. Petersburg.

Tyler Durden Thu, 06/04/2026 - 04:15
Tyler Durden

After Murder Of Henry Nowak, Amnesty International Condemns Right Wing 'Political Commentary'

Zero Rss
2 weeks 2 days ago
After Murder Of Henry Nowak, Amnesty International Condemns Right Wing 'Political Commentary'

Via Remix News,

Amnesty International’s reaction to the murder of Henry Nowak has prompted outrage, with the organization having nothing to say about the atrocious and inhumane actions of the police during the incident, but sharply condemning the “political commentary” in the wake of Nowak’s death.

“At a time when hate crimes are rising, and violence and fear are becoming a daily reality for people of colour and migrants, calls for ‘cold, hard rage’ are completely reckless. Henry Nowak’s murder is an awful tragedy and his family have said “we do not want his death to be used to create further division, hatred or tension”. The very least politicians can do is respect that,” wrote Amnesty International.

Not everyone is happy about Amnesty International’s remarks on the case, which has up until now, said nothing about the manner in which the police handcuffed a dying Nowak as he bled out from eight stab wounds.

Swedish MEP Charlie Weimers wrote on X, “Amnesty has been morally bankrupt for a long time. A pure left-wing organization."

Amnesty är moraliskt bankrutt sedan länge. En ren vänsterorganisation. https://t.co/6W2UaEgNdW

— Charlie Weimers MEP 🇸🇪 (@weimers) June 3, 2026

He was responding to a comment from Lauren Chen, who wrote:

“Incredible statement from Amnesty International UK on Henry Nowak: Not a single word of conveying outrage or horror over the brutal murder, or of how police left him to die without dignity. Instead, their statement is about policing the political commentary around the case. I kid you not. What a grotesque betrayal of any moral purpose.These NGOs aren’t just useless – they actively despise you. They are hostile to everything you value and everything you hold dear.”

Amnesty International, however, is known for its pro-migration and left-wing stances and has a long history of funding from the Open Society Foundation of George Soros. Nevertheless, the organization is often critical of police conduct, which makes it all the more remarkable that the organization has nothing to say about the police’s actions in this case.

🇬🇧 The distressing bodycam footage of Henry Nowak's final minutes has been released by the Crown Prosecution Service.

Henry was stabbed by Vickrum Digwa, with an 8-inch blade he said he carried as part of his Sikh faith, while walking home alone in December last year in… pic.twitter.com/mIM1BgGdkj

— Remix News & Views (@RMXnews) June 1, 2026

The Southampton officers in the case disregarded Nowak’s pleas for help while immediately taking the claims of Vickrum Digwa, who said Nowak made racist comments to him, at face value. Notably, Nowak told the police multiple times that he had been stabbed and warned them: “I can’t breathe.” When he told the officer he had been stabbed, the officer replied, “I don’t think you have, mate.”

At the same time, the murder weapon was given to his mother, and police later found it at the family home along with more than 20 other weapons. His mother is due to be sentenced for removing the murder weapon from the crime scene.

The Nowak case has many parallels with the George Floyd case, where Police Officer Derek Chauvin was controversially convicted for murdering Floyd after placing him in handcuffs and kneeling on his back while Floyd said, “I can’t breathe.” Although the left weaponized the case, sparking mass riots the resulted in billions of damage across the United States, Amnesty International never condemned the left’s political rhetoric in the Floyd case. The Soros-funded organization also never condemned the mass riots, which left stores and homes burned out across major American cities.

If anything, Amnesty International’s “political commentary” around the case only served to inflame tensions and put vulnerable communities under further threat.

This double standard has not been lost on English protesters, who gathered in the streets and chanted “I can’t breathe,” at police officers in Southhampton yesterday, before unrest broke out. Notably, no shops were burned and no businesses harmed during the small-scale unrest — a far cry from the mass riots following Floyd’s death.

JUST IN: 🇬🇧

Thousands of English protesters chant, "i can't breathe," in front of the Southampton police station.

They are protesting the treatment of Henry Nowak by British police, who handcuffed the youth as he lay dying from multiple stab wounds.pic.twitter.com/kXg35Rnw1R

— Remix News & Views (@RMXnews) June 2, 2026

The murder of Nowak had sparked anger across Britain, but parties on the right, in particular, have been the most critical. Amnesty International appears unhappy that political commentators are pointing out the racial double-standard at work, including the police immediately taking the side of the murderer because he cried, “racist.”

Meanwhile, the leader of Restore Britain, Rupert Lowe, is making headlines for his call to return the death penalty for killers like Digwa.

A Restore Britain Government would give the British people a referendum on removing men like Digwa from society for good.

The ultimate deterrent.

The death penalty. pic.twitter.com/yaXWeOnKXa

— Rupert Lowe MP (@RupertLowe10) June 2, 2026

His proposal has now received backing from Elon Musk.

It is this or death https://t.co/zCDJXO9gW1

— Elon Musk (@elonmusk) June 2, 2026

All of this explains Amnesty’s position and why that organization will never try to hold the police accountable for their actions in the Nowak murder case.

Read more here...

Tyler Durden Thu, 06/04/2026 - 03:30
Tyler Durden

zero rss

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