NOAA puts super El Niño odds at 81% as Panama Canal tightens draft limits

Insurance and risk management firm TT Club has called on global supply chain operators to urgently review their resilience strategies as forecasts point to a developing "super" El Niño that could deliver simultaneous disruption to ports, energy systems, commodity markets, and manufacturing centers worldwide.breakbulk+1

Forecasts Point to Historic Strength

The warning, published July 7 by TT Club risk analyst Neil Dalus, comes as meteorological agencies ramp up their projections for the current El Niño cycle. The World Meteorological Organization said in late May there was an 80% likelihood of an El Niño event during June through August 2026, with probabilities near or above 90% for it to persist through at least November. More recent data from the National Oceanic and Atmospheric Administration's Climate Prediction Center put the chance of a "strong" or "very strong" event at 97% through December, with an 81% probability it reaches "very strong" — the threshold for a super El Niño, according to the Los Angeles Times.wmo+2

The BBC reported in June that scientists forecast a 63% chance of sea surface temperature anomalies exceeding 2°C later this year, which would place this event in the same category as the most disruptive El Niño episodes on record.bbc

Panama Canal Already Tightening

The developing weather pattern is already affecting one of the world's most critical shipping chokepoints. The Panama Canal Authority announced in a July 1 advisory that it would lower the maximum authorized draft for Neopanamax locks to 49.0 feet effective July 24, with a further cut to 48.5 feet beginning August 15, according to gCaptain. The reductions follow an initial cut to 49.5 feet that took effect July 3. The moves mark a reversal from the Canal Authority's position in May, when it told Reuters there were no plans for vessel passage restrictions for the remainder of 2026.gcaptain+1

TT Club warned that even short port closures can cascade into longer disruptions, as queues of vessels, containers, and inland transport movements build up faster than they can be cleared. The firm said the additional pressure would hit a logistics system still adjusting to geopolitical conflict, changing trade routes, and recent congestion.breakbulk

Calls for Resilience Across Sectors

TT Club identified the convergence of climate and geopolitical pressures as particularly concerning, noting that reduced fertilizer availability could deepen the impact of drought on crop yields, while higher fuel costs would make diverting cargo around disrupted routes more expensive. The firm urged companies to assess their exposure "by dependency rather than geography alone," warning that indirect effects — including higher insurance premiums, increased working capital requirements, and longer delivery windows — could prove just as damaging as direct physical risks.ttclub+1

"In an interconnected trading system, weather shocks in one region can quickly translate into production shortfalls, transport delays, price volatility and operational disruption elsewhere," TT Club stated.ttclub