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Featured

For a&nbsp;<a href="https://www.gro-intelligence.com/insights/drought-hit-mississippi-river-threatens-corn-soybean-exports" target="_blank" rel="noopener noreferrer">second year in a row</a>, Mississippi River water levels are far below normal for this time of year, hampering southbound shipments of grain for export as the US harvest gets underway and slowing fertilizer shipments heading upstream in advance of next season’s planting.The river’s stage, or the water level relative to a reference point, measured at Memphis dropped this week to as low as -10.2 feet, not as bad as last year’s record low of -10.8 feet but still one of the lowest water levels in 35 years. Barge shipping companies have restricted tow sizes and implemented draft restrictions for deliveries along the Lower and Upper Mississippi River, and along the Illinois River, effectively limiting volumes that can be loaded and transported.&nbsp;River shipment activity for US corn and soybeans typically peaks during the September-to-November post-harvest period. This year, amid river shipping restrictions, southbound barge movement for the two crops is far below normal, as seen in&nbsp;<a href="https://app.gro-intelligence.com/displays/p9BlrLkqM" target="_blank" rel="noopener noreferrer">this Gro display</a>. So far this year, some 9% of US corn, and 5% of soybeans, has been harvested, slightly ahead of the crops’ average pace.Soybeans are the most vulnerable to barge movement delays to Gulf of Mexico ports, since the&nbsp;<a href="https://app.gro-intelligence.com/displays/Pd21M4W9A" target="_blank" rel="noopener noreferrer">lion’s share of soybean exports</a> occurs from October through January, ahead of the Brazilian harvest.&nbsp;The Mississippi River’s back-to-back years of low water levels stem from high temperatures and low rainfall throughout the river basin. Low flows in 2022, as well as in previous low flow years such as 1988 and 2012, contributed to declines in US grain exports, as did decreases in crop production and higher US export prices.&nbsp;(Click the play button at bottom of&nbsp;<a href="https://app.gro-intelligence.com/displays/3d57gkPR0">this Gro display</a> to watch a time-lapse video of the Gro Drought Index showing the pervasive dry conditions throughout the Mississippi River basin since early summer.) &nbsp;Also vital is moving fertilizer upriver from Louisiana ports, where about 50% of waterborne imports of fertilizers are unloaded. US farmers generally apply fertilizers twice a year: after the fall harvest to replenish soil nutrients, and before and during the spring planting season. But this year, barge volumes — of which fertilizer typically makes up about 25%-35% this time of year — are lower than average. (See chart below.)&nbsp;Fertilizer wholesalers and retailers are currently vying for product to meet post-harvest application demand. Suppliers also need to position their inventories for anticipated spring use before the annual closure of the Upper Mississippi River due to winter conditions. Suppliers north of Dubuque, Iowa — more than 1,000 miles north of New Orleans — have until early-to-mid October to place orders before barge shippers refuse new contracts.&nbsp;<img class="image_resized" style="width:75%;" src="https://res.cloudinary.com/gro-intelligence/image/upload/v1695243320/new-website/Mississippi_River_Northbound_Barge_Traffic_9927b49f7d.png"> Mississippi River northbound barge traffic this summer (red line) is below average (blue line) as river levels drop. Fertilizer typically makes up about 25%-35% of barge volumes this time of year. This chart shows numbers of loaded barges passing Lock 27 near St. Louis.

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Low Mississippi River Levels Stymie Grain and Fertilizer Shipments

As Halloween approaches, El Niño is disrupting more than weather patterns and crop cycles — it’s hitting the candy aisles in US supermarkets. Americans purchase around 600 million pounds of candy for the holiday every year. But with chief ingredients like sugar and cocoa facing reduced global supplies, satisfying trick-or-treaters’ sweet tooths will cost more in 2023.While overall US food price inflation is little changed from this time last year — according to the consumption-weighted&nbsp;<a href="https://app.gro-intelligence.com/displays/6Rw1vjAdW" target="_blank" rel="noopener noreferrer">Gro US Food Price Index</a> — candy-making costs are another matter. Ingredients that go into making a milk chocolate bar are up a combined 10% year over year, according to&nbsp;<a href="https://www.gro-intelligence.com/applications/custom-price-index-application" target="_blank" rel="noopener noreferrer">Gro’s Custom Price Index application</a>. For some brands, the ingredient costs of&nbsp; their chocolate bars are up as much as 13%.The Gro Custom Price Index allows food manufacturers to track inflationary pressures by creating customized price indices of product ingredients.&nbsp;Much of the higher candy ingredient costs is being passed on to consumers. For example, list prices for one major US candy manufacturer have risen in every quarter since late 2021, even as gross profit margins bounced back in the 2023 first half from last year’s lows.&nbsp;El Niño, together with other extreme weather events, is a big factor driving up prices for a host of candy bar ingredients:&nbsp;Sugar<ul><li>Sugar costs for manufacturers have jumped 25% year over year, according to the&nbsp;<a href="https://hub.gro-intelligence.com/custom-price-indices/" target="_blank" rel="noopener noreferrer">Gro Custom Price Index</a> application.&nbsp;</li><li>Global sugar supplies are tight —&nbsp;<a href="https://app.gro-intelligence.com/displays/3dX00jgd5" target="_blank" rel="noopener noreferrer">world sugar stocks</a> have fallen for the past two years and are currently at the lowest level since 2011.</li><li>Dry conditions in the western Pacific, brought on by El Niño, have reduced sugarcane harvests in major producers India and Thailand, as Gro wrote about&nbsp;<a href="https://www.gro-intelligence.com/insights/india-s-troubled-sugar-crop-could-further-boost-global-prices" target="_blank" rel="noopener noreferrer">here</a>.&nbsp;</li></ul>Cocoa&nbsp;<ul><li>Cocoa costs candy manufacturers 56% more than it did a year ago, the Gro Custom Price Index shows.&nbsp;</li><li>A driving factor behind the higher prices: El Niño threatens to reduce the main Ivory Coast cocoa crop that will be harvested through the 2024 first quarter. The West African country produces more than&nbsp;<a href="https://app.gro-intelligence.com/displays/gR87onbqe" target="_blank" rel="noopener noreferrer">50% of the world’s cocoa</a>.&nbsp;&nbsp;</li><li>While Ivory Coast has seen abundant rainfall so far in 2023, previous El Niño years have produced drier conditions in the region, curtailing yields, as Gro highlighted&nbsp;<a href="https://www.gro-intelligence.com/insights/ivory-coast-cocoa-bounty-could-dry-up-as-el-nino-strengthens" target="_blank" rel="noopener noreferrer">here</a>.&nbsp;</li></ul>Other ingredients often added to chocolate bars<ul><li>Peanut costs are up 7.5% from last year, according to Gro’s Custom Price Index. Extreme heat in the US South could signal trouble for the 2023 harvest and further support prices.&nbsp;<a href="https://app.gro-intelligence.com/displays/6qAjv5zR4" target="_blank" rel="noopener noreferrer">Crop ratings</a> in Georgia and Texas are currently at record lows.</li><li>Rice costs are up 5% from this time last year, according to the Gro index. Tightening supplies and trade restrictions in many big producers, including&nbsp;<a href="https://www.gro-intelligence.com/insights/india-considers-broadening-rice-export-curbs-as-domestic-food-inflation-mounts" target="_blank" rel="noopener noreferrer">India</a>, have pushed up&nbsp;<a href="https://app.gro-intelligence.com/displays/gR877Jbqe" target="_blank" rel="noopener noreferrer">rice export prices</a> globally and could sustain upward price pressures for food manufacturers. Global rice ending stocks are forecast to decline for a fourth year in a row, as seen in&nbsp;<a href="https://app.gro-intelligence.com/displays/pd33OA0do" target="_blank" rel="noopener noreferrer">this Gro display</a>.</li><li>Almond costs are down more than 2% year over year, providing some relief to food manufacturers after steep increases that drove prices up 17.4% since 2021, Gro’s index shows. California&nbsp;<a href="https://app.gro-intelligence.com/displays/4dg7KJKdo" target="_blank" rel="noopener noreferrer">almond production</a> declined two years in a row and is forecast to be up only slightly this year.</li></ul>

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El Niño Lifts Candy Prices for Halloween

Argentina’s upcoming corn crop already looks to be in trouble as continuing drought threatens to set back planting and lagging fertilizer imports could result in lower nutrient applications for the plants.&nbsp;In Córdoba, Buenos Aires, and Santa Fe — Argentina’s main corn-growing provinces — precipitation has been well below average since June, as seen in&nbsp;<a href="https://app.gro-intelligence.com/displays/gR87x1bqe" target="_blank" rel="noopener noreferrer">this Gro display</a>. In addition, soil moisture levels in Argentina’s corn growing areas are the lowest in over a decade, according to&nbsp;<a href="https://www.gro-intelligence.com/applications/climate-risk-navigator-for-agriculture" target="_blank" rel="noopener noreferrer">Gro’s Climate Risk Navigator for Agriculture</a>.&nbsp;Many Argentine farmers may be reluctant to plant under such dry conditions after last year, when drought caused&nbsp;<a href="https://app.gro-intelligence.com/displays/wRL7VxLqp" target="_blank" rel="noopener noreferrer">corn production</a> to fall by 31% from a year earlier. Planting of the first corn crop normally gets underway in September-October in Argentina, which is the world’s third-largest corn exporter.&nbsp;Shrinking imports of urea and urea ammonium nitrate (UAN) — imports make up about half of Argentina’s total annual consumption of the two popular fertilizers — also are putting the upcoming corn crop at risk. For January through July 2023, Argentina’s urea imports are down 28% year over year, as seen in&nbsp;<a href="https://app.gro-intelligence.com/displays/wRLejME9p" target="_blank" rel="noopener noreferrer">this Gro display</a>. That marks the second consecutive year of fertilizer import declines even as corn planted acreage has varied little, according to&nbsp;<a href="https://app.gro-intelligence.com/displays/WdK0XbrqK" target="_blank" rel="noopener noreferrer">Gro’s Argentina Corn Monitor</a>.&nbsp;UAN imports are essentially flat year over year, although volumes are down 21% from the same January-July period in 2021. On average, Argentina consumed 1.5 million tonnes of urea fertilizer and more than 500,000 tonnes of UAN annually between 2015-2020.&nbsp;The Argentine currency’s weak exchange rate against the US dollar — currently at its&nbsp;<a href="https://hub.gro-intelligence.com/fx-browser/" target="_blank" rel="noopener noreferrer">lowest level in over 20 years</a> — has driven up the cost of fertilizer imports. When converted to Argentine pesos, implied local prices — which excludes freight, storage, and handling costs — from major urea suppliers Algeria and Egypt are the highest in at least five years. (See chart below.)&nbsp;Dry conditions in Argentina’s corn growing areas exacerbates the impact of a potential tightening of nitrogen fertilizer supplies. That’s because planting in dry soils normally requires extra applications of nitrogen, since the nutrient isn’t as readily absorbed as it is when soils have normal moisture levels. As a result, Argentina’s available fertilizer supplies may be insufficient to help the upcoming corn crop overcome a weak start.&nbsp;Large corn crops this year in Brazil and the US will offset any shortfall in Argentina’s production for global supplies. Still, a poor crop could further damage Argentina’s beleaguered economy. In 2022, for example, reduced nitrogen applications to Argentina’s staple crops — which include corn, rice, soybeans, and wheat — resulted in an estimated 1.4% decrease in food production, equivalent to about 365 trillion calories, according to&nbsp;<a href="https://www.gro-intelligence.com/global-fertilizer-impact-monitor" target="_blank" rel="noopener noreferrer">Gro’s Global Fertilizer Impact Monitor</a>, which calculates the impact on crop output worldwide based on projected cutbacks in nitrogen fertilizer consumption.&nbsp;Gro’s Fertilizer Impact Monitor was built with support from the Bill &amp; Melinda Gates Foundation and in partnership with the International Fertilizer Association and CRU Group.Rain will be critical in the next few weeks to recharge the soil and enable Argentine corn planting to proceed as planned.&nbsp;<a href="https://hub.gro-intelligence.com/plot-region/agriculture/1010,Argentina$%7B%22checked%22%3A%5B%22MAGyP%20Corn%20(Argentina%20only)%22%5D%2C%22method%22%3A%22sum%22%7D_2?0,World:16,South%20America:1010,Argentina" target="_blank" rel="noopener noreferrer">Current forecasts</a> call for minimal precipitation. If that continues, farmers could decide to shift more of their planting to the second corn crop, which is planted at the turn of the year, or switch to soybeans, which go in the ground in November-December.<figure class="image"><img src="https://res.cloudinary.com/gro-intelligence/image/upload/v1694636968/new-website/Argentina_s_Urea_Fertilizer_Import_Costs_Rise_as_the_Peso_Sinks_57dc418f3a.png"></figure>Argentina’s urea fertilizer import costs have risen sharply as the Argentine peso has lost value against the US dollar. This chart shows urea prices from major producers Algeria and Egypt converted into pesos, indexed for the past five years.

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Argentina’s Corn Crop Is Threatened by Drought, Low Fertilizer Supplies

As extreme weather continues worldwide, monitoring and accurately quantifying hot and dry conditions can help quantitative and financial teams stay ahead of major commodity market movements. To address these needs, Gro Intelligence, an AI-driven data and analytics company helping businesses, financial institutions, and governments make better decisions on food security and climate risk, has built the Gro Drought Index (GDI). The GDI is a proprietary index of global drought and a high-signal indicator of major agricultural trends such as abandoned acres, yields, and prices.In this report, we explore two case studies where the GDI led futures prices and presented signals for profitable trades: US hard red winter wheat and US cotton.You will learn how:&nbsp;<ul><li>Quantitative and fundamental analysts can use the Gro Drought Index to focus on drought impact in crop-growing areas and anticipate potential threats to production and prices</li><li>Early on in a crop's growing season, the Gro Drought Index can provide an assessment of the potential for abandoned acres (a key indicator of price) in a growing region, down to the county level</li><li>There is a significant linear relationship between average monthly Gro Drought Index readings and the average monthly price of major agricultural commodities</li></ul><a href="https://info.gro-intelligence.com/using-the-gro-drought-index-as-a-high-signal-trading-indicator" target="_blank" rel="noopener noreferrer">Download the report here</a>.

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Using the Gro Drought Index as a High-Signal Trading Indicator for Agricultural Commodities

Gro Intelligence has over 2 million unique, proprietary data series that address a range of questions across crop yield and production, supply and demand, growing conditions, and climate scenarios. Gro's data series are built by our team of 50+ domain experts and scaled through artificial intelligence, generating predictive models and real-time applications. Our products provide accurate forecasts and holistic views into the most pressing challenges across climate, agriculture, and the economy.&nbsp;In this report, we focus on the performance of our Global Yield Forecast Models across corn, soy, and wheat, as well as our US Planting Intentions Model and US Prevent Plant Models for corn, soy, wheat, and cotton.&nbsp;You will learn how:&nbsp;<ul><li>Historically, for the past seven years, Gro’s US Corn Yield Forecast Model has been on average within 98.3% of the USDA final January report by September. Our US Soybean Yield Forecast Model has been on average within 99% of the USDA’s final number by September for the last four years.</li><li>In critical global regions, where the current marketplace does not have many machine learning-based predictive models, such as Ukraine, Brazil, and China, Gro’s 2022 Global Yield Forecast Models were on average 95% accurate up to 10 months ahead of final government reporting.</li><li>Gro’s suite of machine-learning models provide an unprecedented combination of accuracy, global coverage, granularity down to the district level, and daily in-season updates to enable our customers to move ahead of the market.</li></ul>Download the 2022 performance report <a href="https://info.gro-intelligence.com/2022-performance-report-on-yield-forecast-and-acreage-models?utm_campaign=End%20of%20the%20Year%20Report%20-%20January%202023&amp;utm_medium=email&amp;_hsmi=2&amp;_hsenc=p2ANqtz--DAawbx4JnPmIhs6GrNfist1fGwSINeh_jnpFQ9_1aaJrTOxCIMEY1Xq-DyHJPXbhZ9TUpn5frwnku07Tb0UXCk7b3NiU9gn6sw5XtheL7Ena6_aw&amp;utm_content=2&amp;utm_source=hs_email" target="_blank" rel="noopener noreferrer">here</a>.

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2022 Performance Report: Gro Yield Forecast Models and Acreage Models

In this report, we will talk about how to use growing and climate conditions in a systematic way to better anticipate impact on final yield throughout the growing season—from planting to harvest.&nbsp;<a href="https://info.gro-intelligence.com/incorporating-climate-into-agricultural-forecasting" target="_blank" rel="noopener noreferrer">Download the report here.</a>

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Incorporating Climate Into Agricultural Forecasting

Global vegetable oil prices have been on an upward trajectory for the better part of two years. The onset of the Russia-Ukraine war on February 24 caused prices to spike higher in volatile trading as Black Sea sunflower oil exports were halted by the conflict.In Gro’s latest Strategic Assessment, we address the impact of the Russia-Ukraine war on global vegetable oil markets. We show how vegetable oil supplies face renewed risks in several countries, which will continue to weigh on global markets, and how industry pressures may keep prices elevated for some time to come.You will learn:<ul><li>Why global vegetable oil production has struggled to keep up with rising consumption</li><li>How the Russia-Ukraine war and increasing demand for biofuels have exacerbated concerns about global vegetable oil supplies</li><li>How to monitor global production prospects to forecast potential impacts to the vegetable oil market</li></ul>&nbsp;<a href="https://info.gro-intelligence.com/russia-ukraine-war-vegetable-oil-prices" target="_blank" rel="noopener noreferrer">Download the Strategic Assessment</a>

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Fuel for the Fire: The Russia-Ukraine War and Vegetable Oil Prices

Gro Intelligence and DTN are partnering for their sixth annual Digital Yield Tour – a state-by-state analysis of corn and soybean production in key US growing regions. From Monday, August 7, to Friday, August 11, DTN will provide detailed, on-the-ground reporting and Gro will leverage our powerful machine-learning predictive modeling to show how US corn and soy yields are faring this year and what we can expect from the 2023 season.See daily tour updates on <a href="https://spotlights.dtnpf.com/dyt/" target="_blank" rel="noopener noreferrer">DTN’s website here</a>, and <a href="https://www.dtn.com/2023-ag-summit-series/" target="_blank" rel="noopener noreferrer">register for a webinar</a> on the tour next Tuesday, August 15, at 8:30 AM CDT (Session 3: Digital Yield Tour 2023) to hear Gro Intelligence’s research analysts discuss the US corn and soybean season thus far.Gro’s US Yield Forecast Models Are a Powerful Predictor of Global MarketsBecause the US is the largest producer and consumer of corn and the second-largest producer and exporter of soybeans, fluctuations in yield for these crops&nbsp; have global price ramifications. Following estimates of US production throughout the season is critical for decision-makers across the agricultural supply chain.&nbsp;Gro’s US Corn &amp; Soybean Models provide highly accurate, daily estimates of end-of-season yields to help users get ahead of major market movements. Past years’ performance show that the models’ forecasts are within 98% of the USDA’s final January reporting up to four months in advance. (Check out more in<a href="https://info.gro-intelligence.com/2022-performance-report-on-yield-forecast-and-acreage-models"> our 2022 Performance Report</a>.)Our US models estimate in-season yields at the county, state, and national levels. These models use weather, vegetation health, soil data, and other inputs to monitor environmental and crop conditions during the growing season and continuously forecast final yield.Gro’s customers use these models to:<ul><li>Predict end-of-season yields months sooner than government reports.</li><li>Monitor crop production – the most significant part of the balance sheet – by tracking in-season yield (its most variable component).</li><li>Understand the impact of climate conditions on crop availability and price.</li></ul>What Are We Seeing So Far This Season?According to&nbsp;<a href="https://www.gro-intelligence.com/models/us-corn-yield-model">Gro’s machine-learning model’s&nbsp;</a>latest predictions, higher forecasted yields and an increase in planted acreage could drive US corn production to a double-digit gain from last year.&nbsp;&nbsp;&nbsp;That’s a sharp reversal from the crop’s outlook early in the season, when June’s poor rainfall — the lowest for the Corn Belt in more than a decade — presaged a weak harvest. Precipitation rebounded in July, however, and total rainfall for that month was above the 10-year average.&nbsp;<a href="https://app.gro-intelligence.com/displays/B2da7KVRn">Gro’s US Soybean Yield Forecast Model</a> also currently indicates yields will be above last year. August and September weather has the greatest bearing on US soybean yields. Extended weather forecasts as the calendar flips to August are favorable for soybean pod set and pod fill.&nbsp;However, good-to-excellent crop ratings are still well below average for US corn and soybeans.&nbsp; Daily updates from Gro’s Yield Forecast Models offer insights into these dynamic conditions as the season continues.Read more about the Gro Yield Forecast Models&nbsp;<a href="https://gro-intelligence.com/models/us-corn-yield-model">here</a> or schedule a demonstration to learn how our Yield Models can be tailored to your organization’s needs&nbsp;<a href="https://info.gro-intelligence.com/schedule-a-demo">here</a>.

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Gro x DTN Digital Yield Tour: Leveraging Gro’s Machine-Learning Forecast Models

As global&nbsp;<a href="https://www.gro-intelligence.com/insights/extreme-heat-threatens-crop-prospects-around-the-world">temperatures reach historic extremes</a>, land surface temperature (LST) becomes an especially critical input when predicting the impact of heat stress on crop planting, development, production, and yield. In July, to complicate matters further, NASA’s two satellites that house MODIS sensors – which detect and measure land surface temperature among many other datasets – are experiencing an outage due to a data lapse from its Adaptive Processing System where data from several NASA satellites is processed for users.In 2022, after witnessing a series of other satellite data lapses, Gro’s research and development teams created a Gro LST measure to safeguard against outages like the one we’re experiencing now, ensuring Gro’s measurement of land surface temperature is not disrupted by a single-source outage.“Gro LST” is a generative AI model that incorporates observations from multiple LST and air temperature sources, shares information across them, and delivers a consistent and complete representation of a synthetic LST time-series. The result is an aggregated LST metric that can approximate a valid LST observation every day for all target geographies regardless of data availability from underlying LST and air temperature sources.&nbsp;While datasets ingested from the NASA MODIS sensors remain an input to Gro LST, they are one of many, ensuring Gro LST can continue to provide the same highly accurate LST values to our models.&nbsp;<figure class="image"><img src="https://res.cloudinary.com/gro-intelligence/image/upload/v1690819466/new-website/Temperature_Availability_FINAL_3ff788f51a.png"></figure>Today, Gro LST is a key input to&nbsp;<a href="https://www.gro-intelligence.com/platform/models" target="_blank" rel="noopener noreferrer">Gro’s yield forecast models</a>, preserving model performance during data disruptions or outages from other temperature sources.&nbsp;While these types of outages are relatively short-lived, they can be unpredictable and data lags can last for several weeks.&nbsp;Geospatial data disruptions or delays are caused by a number of factors including faulty satellites, government shutdowns,&nbsp;lags in availability, and even cloud cover.&nbsp;Given the current MODIS outage, the contingencies built into Gro LST have proved to be beneficial and we anticipate that there will be no practical impact to the quality of Gro’s yield forecasts.To learn more about Gro models and methodology,&nbsp;<a href="https://www.gro-intelligence.com/contact">contact a member of our team here</a>.&nbsp;

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Gro’s Temperature Generative AI Model: Building Resiliency to Data Disruption

A recent&nbsp;Nature Climate Change&nbsp;paper co-authored by Gro Intelligence Climate Data Scientist Dr. Greg Garner assesses how scientists have communicated climate-related risks related to rising sea levels.&nbsp;In the study, the scientists review the language and graphics used in climate assessment reports by members of the United Nations’ Intergovernmental Panel on Climate Change (IPCC) in the period from 1990 to 2021. The analysis evaluates whether the risk of sea-level rise has been presented accurately, which can be critically important for public bodies planning for environmental changes in coastal cities.&nbsp;When conveying sea-level uncertainties that have been and remain difficult to quantify, the language in the reports often has fallen short, either oversimplifying projections or conveying the information in a confusing manner, according to the analysis. Such language could lead policymakers to neglect the risks associated with possible high-end, sea-level outcomesIn the IPCC’s First Assessment Report, released in 1990, the report’s authors characterized a rapid disintegration of the West Antarctic Ice Sheet because of global warming as a low-probability event, saying such an occurrence is “unlikely in the next century.” However, in the Sixth Assessment Report, published in 2021, scientists embraced language that conveyed the ambiguity around the Antarctic ice sheet dynamics and warned that higher rates of sea-level rise before 2100 could be “caused by earlier-than-projected disintegration of marine ice shelves, the abrupt, widespread onset of marine ice sheet instability and marine ice cliff instability around Antarctica.”&nbsp;The report goes on to explain that the processes are characterized by “deep uncertainty.” It concludes: “In a low-likelihood, high-impact storyline, under high emissions such processes could in combination contribute more than one additional meter of sea level rise by 2100.”Communicating complex risk scenarios to the public in an effective manner is an ongoing process. If the approach taken in the most recent climate report in 2021 is successful, it will be accurately reflected in future regional assessments and will ultimately be judged by policymakers, along with climate and social scientists.<a href="https://www.nature.com/articles/s41558-023-01691-8">Read the full paper here</a>.Data Are Critical in Assessing Climate Risk and UncertaintyAs noted in the&nbsp;Nature Climate Change paper, Dr. Garner used a “probability box” (p-box) approach to convey the level of deep uncertainty in the sea-level change projections for the Sixth Assessment Report. Multiple simulations, each using a different combination of models for land-ice contributions, produce probabilistic views of future sea-level change. These projections were then combined into p-boxes that convey deep uncertainty consistent with IPCC likelihood language. It was the first time this level of effort in quantifying deep uncertainty has happened for sea-level change projections in an IPCC report.Although the level of clarity fluctuates between reports, it&nbsp;is clear that&nbsp;under all climate change scenarios shown by the Intergovernmental Panel on Climate Change, companies and governments will increasingly face significant risk of physical climate impact in coming years. To manage that risk, companies must first measure it. Yet how does one measure uncertainty?Gro works directly with companies in both the agricultural and the food and beverage industries to&nbsp;help form a clearer picture of the effect that extreme weather volatility is having, and will continue to have, on the places and ecosystems that they care most about. Gro does this through combining our extensive data ecosystem, powerful predictive platform, and team of 50-plus domain experts.&nbsp;Our customizable models and applications, such as&nbsp;our&nbsp;<a href="https://www.gro-intelligence.com/applications/climate-risk-navigator-for-agriculture">Climate Risk Navigator for Agriculture</a>, leverage real-time data and long-term climate indicators to measure and assess climate risk – providing sound predictions along with quantified uncertainty.&nbsp;“If we are planning for transition and resilience, predictability is a key factor in modeling any type of risk,” said Sara Menker, Gro Intelligence’s CEO.Dr. Garner's work exemplifies Gro’s commitment to applying predictive modeling and cutting-edge research to real-world challenges. By collaborating with other climate scientists at Gro, Dr. Garner continues to advance our understanding of sea-level change projections and support decision-making processes in addressing climate risks.“The concept of uncertainty and ambiguity in risk analysis can be scary, but it doesn’t have to be,” said Dr. Garner. “Frameworks exist now to not only acknowledge uncertainty, but to capture it and leverage it for a fuller picture of risk quantification and improved decision-making.”<a href="https://www.nature.com/articles/s41558-023-01691-8">Read more in the&nbsp;Nature Climate Change paper here</a>.Robert Kopp, a professor in the Department of Earth and Planetary Sciences at Rutgers University, led the&nbsp;Nature Climate Change study with Jessica O’Reilly, an anthropologist at Indiana University Bloomington who studies the IPCC, and Michael Oppenheimer, a Princeton University climate scientist who has served with the IPCC since the First Assessment Report. The other authors in the study, all of whom were involved with the Sixth Assessment Report, include those from Brown University and the University at Buffalo in the U.S., as well as others in China, France, Germany, Great Britain, the Netherlands, New Zealand and Singapore.&nbsp;

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Gro Climate Data Scientist Co-authors Nature Climate Change Paper

As the US Northeast and Northwest deal with smoke pollution from Canadian wildfires, Gro Intelligence will soon be releasing our latest fire management and prediction model: Gro Climate Indicator (GCI): Fire Weather Index.The Gro Fire Weather Index is designed to assess and analyze factors that contribute to the risk and behavior of wildfires at a global scale. The index uses critical variables — including temperature, humidity, wind, and fuel moisture content — to provide insights into the possible ignition, spread, and intensity of fires, with the aim of enhancing fire-management strategies at the district, province and national levels.Gro’s objective is to empower fire-management agencies and emergency-response teams with advanced predictive capabilities. While the Gro Fire Weather Index doesn’t predict the likelihood of an ignition event, it effectively identifies areas prone to outbreaks by analyzing conditions conducive to ignition and expresses this risk as a Fire Weather Index (FWI).Gro’s models point to a year of heightened fire danger as the world enters an El Niño climate event pattern. The graphs below showcase the Fire Weather Index for Alberta and Quebec — two of the Canadian provinces currently experiencing extensive wildfires. The FWI graph reveals peak risk periods typically expected during a fire season.&nbsp;For 2023, however, (shown by the blue lines) the magnitude of these peaks relative to the last 40-plus years of data (represented by the purple All-time mean lines) is remarkably high and is reminiscent of the alarming conditions experienced during the 2015 El Niño phase.Gro Intelligence's GCI: Fire Weather Index aims to provide stakeholders with invaluable insights to effectively allocate resources and mitigate the devastating impact of wildfires.<figure class="image"><img src="https://res.cloudinary.com/gro-intelligence/image/upload/v1686319654/new-website/Fire_weather_index_Alberta_Regional_pixel_level_mean_2_5_0dd3ca64ea.png"></figure><figure class="image"><img src="https://res.cloudinary.com/gro-intelligence/image/upload/v1686319669/new-website/Fire_weather_index_Quebec_2_eafe13c8e7.png"></figure>&nbsp;&nbsp;&nbsp; &nbsp;

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Measuring Risk of Wildfires: Gro’s Fire Weather Index

Gro has added a new Climate Indicator for Observed Fire (GCI - Observed Fire) to our growing Climate Risk Assessment Suite to help companies, financial institutions, and governments better identify and respond to the impacts of wildfires on populations, farmland, infrastructure, and investment portfolios.Wildfires are a growing concern worldwide, particularly in countries and regions seeing higher temperatures and longer stretches of drought, where fire can spread more easily.&nbsp;Tools that monitor the outbreak of fires have become a key component of any comprehensive climate risk assessment. However, the need to normalize and integrate historical data from multiple platforms has made it difficult to access a consistent history of fire occurrences and severity at a global scale. While local agencies are a key resource in assessing the impact and spread of live fire emergencies, their analyses can now be paired with the historical context provided by the GCI - Observed Fire, which goes back 20 years.<figure class="image image-style-align-center image_resized" style="width:75.6%;"><img src="https://res.cloudinary.com/gro-intelligence/image/upload/v1684179548/new-website/image4_beccd6b64d.png"></figure>The GCI - Observed Fire draws from high-resolution satellite imagery to track historical fire observations for every district worldwide. Available at the district, province, and national levels globally for the last two decades, the Indicator provides a “percent area with detected fire” across districts for each day, month, or year.&nbsp;Now, with this Indicator,<ul><li>Companies can identify the regions where fires are most likely to occur to understand the potential impacts on their supply chains.&nbsp;</li><li>Financial institutions can conduct studies on specific physical assets, commodities, or portfolio holdings in order to understand instances of damage and their impacts, as well as factors such as insurance rate changes.</li><li>Governments can conduct detailed analyses to better understand impacts on populations and infrastructure, as well as better position assets to respond more quickly and efficiently.</li></ul>The GCI - Observed Fire is accessible in Gro’s <a href="https://www.gro-intelligence.com/applications/climate-risk-navigator-for-agriculture" target="_blank" rel="noopener noreferrer">Climate Risk Navigator Application</a> and the Gro API and can be paired with Gro’s other available Climate Indicators, such as Water Stress, Observed Flood, or Drought, to name a few examples, to get a holistic understanding of climate risk. Additionally, users can weight the Indicator by cropland or asset. For example, Observed Fire can be used to understand the recent fires in Canada (reflected in the clip below), and the potential overlap with populations, infrastructure assets, or crop growing areas - in order to better plan and prepare for damages.&nbsp;<figure class="image image-style-align-center image_resized" style="width:75.68%;"><img src="https://res.cloudinary.com/gro-intelligence/image/upload/v1684181895/new-website/timeline_2_df7a053c11.gif"></figure>Later this year, Gro will continue to improve upon its suite of Climate Indicators by - among other improvements and additions -&nbsp; making the GCI - Observed Fire predictive. This will allow companies, financial institutions, and governments to anticipate outbreaks of fire globally and plan for the event.<a href="mailto: salesteam@gro-intelligence.com" target="_blank" rel="noopener noreferrer">Contact a member of our team</a> to see how to leverage the GCI - Observed Fire to meet your business needs.

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Gro Adds Global Observed Fire Indicator to Climate Risk Assessment Suite

Gro has launched a new Climate Indicator for Water Stress (GCI - Water Stress) to help companies, financial institutions, and governments better manage and respond to risk in water-stress-prone areas around the world.&nbsp;Water stress occurs when there is high competition among users, causing demand for water to exceed water availability. High water stress can be caused by low water supply and high demand, but it can also occur when water supply is high. In a high water supply situation, water demand can still be higher, resulting in high water stress.The GCI - Water Stress measures the ratio between water withdrawals (demand) and water availability (supply) across watersheds worldwide to show the amount of water stress globally, as well as at the national, district, or watershed levels for a more granular view.&nbsp;Accessible through Gro’s Climate Risk Navigator Application and the Gro API, the GCI - Water Stress provides water stress data scored on a 0-5 scale, where 0 represents low water stress and 5 represents high water stress. Higher water stress values indicate more competition among users, and low water stress values indicate there is enough water available for the users in that area.&nbsp;With this information,<ul><li>Companies can assess which assets or production-specific facilities are in water-stress prone areas to improve corporate reporting and better manage supply chain risk.&nbsp;</li><li>Supranational, or national, state, and regional governments can see regions under their jurisdiction that are high water-stress areas to correlate with other economic factors or to target specific funding programs.</li><li>Investors and portfolio managers can evaluate which companies are concentrated in areas with high water stress, as well as study new decisions that companies are making, such as where they build new factories, to see if those are areas where water stress is high.&nbsp;</li></ul>Gro provides both an actual water stress score - which represents baseline water stress values directly from the data source calculated at the watershed level - as well as Gro’s unique weighted average water stress score, which takes actual water stress score values and averages these values across Gro’s regions. The GCI - Water Stress score can additionally be weighted by the asset selected by the user, such as power plants or transportation, to show which assets would be most affected by water stress.Water stress, as it considers both water supply as well as demand, differs fundamentally from drought measurements provided by the Gro Drought Index, which only measures water supply. In addition, the GCI - Water Stress provides a static, average value over a large time interval, whereas the GDI value represents dynamic values that update every day.The GCI - Water Stress complements Gro’s existing climate risk assessment analytics, which allows customers to forecast the impact of various climate risks - from drought to excessive rainfall - on infrastructure, crop-growing regions, or other assets. It can be additionally used with Gro’s Land Suitability Model to indicate which regions most suitable for growing certain crops have water stress risks.<a href="mailto: salesteam@gro-intelligence.com" target="_blank" rel="noopener noreferrer">Contact a member of our team</a> to see how to leverage the GCI - Water Stress to meet your business needs.

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Gro Expands Climate Risk Assessment Suite With New Water Stress Scoring

According to the&nbsp;Intergovernmental Panel on Climate Change’s (IPCC)&nbsp;<a href="https://www.ipcc.ch/report/ar6/syr/">synthesis report</a> released in mid-March, keeping global warming to 1.5°C is achievable with a quantum leap in climate action. This leap is only made possible through a global effort to enact policies and measures that will lead to deep and sustained reductions in greenhouse gas emissions.&nbsp;To better analyze carbon emissions policies at the country level, along with the cost of compliance implied by each country’s&nbsp;CO2&nbsp;reduction policies,&nbsp;Gro and Kepos Capital have partnered to launch the Gro-Kepos Carbon Barometer™.&nbsp;<a href="https://community.gro-intelligence.com/carbon-barometer">Click here to explore the Gro-Kepos Carbon Barometer™</a>The&nbsp;<a href="https://community.gro-intelligence.com/carbon-barometer">Gro-Kepos Carbon Barometer</a>™ tracks seven major&nbsp;CO2 emissions reduction policy categories for more than 25 countries which make up over 83% of global emissions,&nbsp;using both public databases and government sources.&nbsp;It normalizes the policies into a “Carbon Barometer Price™” – the amount, in US dollars, that emitters must pay on average per ton of&nbsp;CO2 emissions as an incentive to develop and leverage low-carbon drivers of economic growth. This makes it simple to analyze the financial incentive for each country to comply with policies designed to reduce carbon emissions.The “carbon barometer” concept was originally developed by&nbsp;world-renowned financial and quantitative investing experts Bob Litterman and Mark Carhart of&nbsp;<a href="https://www.keposcapital.com/#/">Kepos Capital</a> in consultation with climate economists and carbon policy experts. That concept has been operationalized by bringing together Gro’s and Kepos’s combined domain expertise in climate and economic research, and by leveraging Gro’s demonstrated success in the automated ingestion and organization of complex, global datasets. Throughout its development and on an on-going basis, this joint Gro-Kepos effort is supported by&nbsp;carbon policy thought leaders from academia, environmental non-profits, and the private sector who provide advice and feedback, serving as the Carbon Barometer™ Advisory Board.Operationally, the Gro-Kepos Carbon Barometer™ will enable high-emitting countries committed to climate action to identify and understand&nbsp;CO2 policy actions that have been successful elsewhere and then, in implementing their own policies, to consistently measure progress against global benchmarks. And because the Carbon Barometer Price™ is provided globally, the metric supports the creation and monitoring of new, Paris-aligned sustainability investments in typically lower-emitting developing countries.By providing a standardized metric for measuring countries’&nbsp;CO2 emission reduction policy progress, the Gro-Kepos Carbon Barometer™ can be used to study which policies are the most effective at reducing a country’s&nbsp;CO2 emissions. For example, if the Carbon Barometer Price™ is low versus other countries or the global price, it indicates that a government is doing comparatively little to reduce its emissions via policy action. As the Gro-Kepos Carbon Barometer’s™ time series goes back to 2008, users can also use it to track the evolution of policy over time, signaling how serious each country has become about enacting carbon policies.&nbsp;Additionally, the Gro-Kepos Carbon Barometer™ will serve as an important new benchmark for financial markets, enabling issuers to measure performance of sustainability-linked instruments and lenders to invest in line with sustainability goals for their portfolios. With almost 15 years of high-quality, back-testable data, this automated metric can be leveraged by asset managers as both a signal for research and for investment analytics.In less than eight months, world leaders will be gathering at COP28 in the UAE to launch the process for preparing the next cycle of nationally determined contributions, due in 2025, making a clearer view into how much countries are doing to reduce&nbsp;CO2 emissions even more critical. These national climate plans aimed at reducing emissions and adapting to the impacts of climate change will need to reflect the accelerated climate action that the world needs during this decade and the next.&nbsp;<a href="https://community.gro-intelligence.com/carbon-barometer">Click here to explore the Gro-Kepos Carbon Barometer™</a>For any questions on the Carbon Barometer™ or to learn more about Gro’s data and analytics, contact us at&nbsp;<a href="mailto:support@gro-intelligence.com">support@gro-intelligence.com</a>. <a href="https://community.gro-intelligence.com/carbon-barometer" target="_blank" rel="noopener noreferrer"><img src="https://lh3.googleusercontent.com/kYMt81HEqqw4oh7hD64mgCr-WmQRDnK4jUshKpDYWaXt72Jh2U7uO2bKlUCu-z57k1dllK1m7rFIUkNiA02k7cPSLmuqFO9K5LqAZET_gxAt02IALforlS6t6QpuNTGMkbKttGN7WJViFtfEQtKcAAw"></a>About Gro’s Partnership with Kepos Capital&nbsp;Gro’s partnership with Kepos Capital represents a unique opportunity to advance efforts to reduce&nbsp;CO2 emissions and advance climate financing. Under the terms of this agreement, Gro was provided with the underlying data that supported Kepos’ earlier version of the Carbon Barometer™.&nbsp;Kepos Capital was founded in 2010 by Mark Carhart, Giorgio De Santis, and Bob Litterman, the&nbsp;co-developer of the Black-Litterman Global Asset Allocation Model, a key tool in modern investment management. Litterman also chairs the Gro-Kepos Carbon Barometer’s™ Advisory Board.&nbsp;The Gro-Kepos Carbon Barometer™&nbsp;<a href="https://community.gro-intelligence.com/carbon-barometer/advisory-board">Advisory Board</a>, which was created to facilitate research in the climate-policy and climate financing space, does not participate in any aspect of Kepos Capital LP investing, Kepos Capital LP, or Gro Intelligence operations, and it in no way endorses any Gro Intelligence or Kepos Capital LP products.

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