KC SPECIALIST · Softs / Brazil Weather
Z6507 – [KC] ENSO Dry Season Weight Signal
NOAA Oceanic Niño Index weighted by Brazil Arabica dry-season and flowering windows, as a long-lead ENSO-driven supply signal for Arabica.
At a glance
DORMANT · WAITING FOR MAY
Current reading
-0.656
SEASONAL STATE
DORMANT · WAITING FOR MAY
ENSO window closed
Signal state
El Nino Dry Season
210 days in Stress phase
Updated
Nov 04, 2026
Monthly NOAA ONI release
Sample
36-year window
Monthly ONI, daily aligned
As of Nov 04, 2026. Updated nightly. · NEXT WINDOW MAY 2027
SIGNAL OVERVIEW
Brazil ships roughly 35 percent of the world Arabica crop and the Southeast Brazil growing belt is strongly modulated by the El Nino Southern Oscillation. When Pacific sea-surface temperatures run cool (La Nina) during the May through September dry season or the September through January flowering window, Southeast Brazil precipitation tends to run below normal, stressing Arabica yield and tightening the market. When Pacific SSTs run warm (El Nino) in the same windows, Brazil tends to see above-normal rainfall and looser supply. The signal weights NOAA Oceanic Nino Index by the biologically-relevant Brazil windows and signs it so La Nina reads as positive composite. Daily Spearman IC against Arabica forward 60-day returns is plus 0.098 at p-value 1e-20 across 8,947 observations; Phase +1 La Nina dry-season firings deliver a plus 1.76 pp edge above baseline. Full regime stats and historical case episodes below.
LIVE CHART
KC ENSO Dry Season Weight Signal
What the chart is showing right now. The dark line is the ENSO-weighted composite, signed so La Nina dry season reads as positive composite, tanh-bounded to plus or minus one on the left axis. Positive composite means La Nina conditions during Brazil Arabica growing windows (dry season or flowering), which is bullish Arabica via supply stress. The bronze line in the middle panel is ICE US Coffee C first-nearby in cents per pound. The bottom panel tracks the trailing 252-day Spearman information coefficient between the composite and Arabica forward 60-day returns. Green band fills mark La Nina Dry Season extremes (historically bullish Arabica); red band fills mark El Nino Dry Season extremes (historically bearish Arabica).
COMPOSITE
-0.656 / tanh
STATE
El Nino Dry Season
PHASE
-0.78
DAILY IC
+0.098 (p < 1e-20)
PHASE SPREAD
3.46 pp
TODAY’S PLAYBOOK READING
STATE
Moderate Neg
STATE AND HISTORY
El Nino Dry Season firing at composite -0.656, 210 trading days running in the STRESS phase. Phase +1 (La Nina Dry Season) delivers plus 4.07 percent fwd60d / plus 1.76 pp above plus 2.32 pct baseline. Phase -1 (El Nino Dry Season) delivers plus 0.61 percent / minus 1.70 pp below baseline. Daily IC plus 0.098 at p less than 1e-20. Non-overlap rho plus 0.099 at p = 0.23 across 150 samples; not independently significant but sign-consistent with daily.
THE ENSO MECHANISM
Brazil produces about 35 percent of world Arabica, concentrated in Southeast Brazil (Minas Gerais, Sao Paulo, Parana). Pacific sea-surface temperature anomalies modulate Southeast Brazil precipitation through tropical Walker and Hadley circulation changes. La Nina (cool Pacific) during the May-September dry season or September-January flowering produces below-normal rainfall, stressing yield. El Nino (warm Pacific) in the same windows produces above-normal rainfall and looser supply. The signal weights ONI by the biologically relevant windows.
HOW TO POSITION
Primary long-lead supply read on Arabica. La Nina dry-season firings (composite above plus 0.5) historically coincide with multi-quarter Arabica rallies. El Nino firings coincide with Brazil-loose regimes. Pair with the Cecafe realized-price signal (short-lead confirmation), ICE Europe COT positioning, and USDA FAS Brazil attache reports.
WHAT THE CHART SHOWS
The composite sits at -0.656 in the El Nino Dry Season band. Pacific sea-surface temperatures have run warm through the Brazil 2026 dry season. The current STRESS episode began January 2026; current episode has run 210 trading days which meets the BTD danger threshold.
TOP INPUTS FIRING
- Primary composite -0.656 State El Nino Dry Season, 210 days running in STRESS phase.
- Pacific SSTs running warm during Brazil dry season NOAA Oceanic Nino Index has stayed in positive (warm) territory through the Brazil May-September 2026 dry season, translating to above-normal Southeast Brazil precipitation.
- Non-overlap test not independently significant (honest caveat) Non-overlap IC at 60-day sampling delivers rho plus 0.099 with p-value 0.23 across 150 samples; sign- consistent with daily IC plus 0.098 but not independently significant.
THE TAKEAWAY
What this means for you today
THE ENSO CALL
Composite -0.656, El Nino Dry Season. Pacific sea-surface temperatures are running warm during the Brazil dry-season window. Signal firing in the El Nino bucket for 210 trading days; forward 60-day edge in Phase -1 historically runs minus 1.70 pp below baseline.
THE EMPIRICAL CONTEXT
Phase stats show clean monotone pattern. Phase +1 (La Nina) delivers plus 1.76 pp above baseline; Phase 0 (Neutral/off-season) delivers plus 0.81 pp; Phase -1 (El Nino) delivers minus 1.70 pp. 3.46 pp directional spread, one of the cleanest monotone ENSO-mechanism patterns in the Arabica supply library.
THE HONEST CAVEAT
Non-overlap test at 60-day sampling delivers rho plus 0.099 with p-value 0.23 across 150 samples; sign-consistent with daily IC but not independently significant at the 5 pct threshold. ENSO effect is long-lead (3 to 9 months) so short-horizon forecasting is noisier than the daily IC implies. Use as a stacked overlay, not a standalone trigger.
THE REGIME MAP
The three phases, forward returns and sample share
Computed from 9,007 post-warmup trading days (1990-12-03 onward). Baseline Arabica fwd60d: plus 2.32 percent (median minus 0.96 percent). Phase +1 (La Nina Dry Season) delivers +1.76 pp edge; Phase 0 delivers +0.81 pp; Phase -1 (El Nino Dry Season) delivers -1.70 pp. Non-overlap IC not significant at p=0.23 (every-60d sampling, n = 150), though sign-consistent with daily IC.
| State | Phase | Share | Fwd 60d | HAC t | Edge vs baseline | Last firings |
|---|---|---|---|---|---|---|
| La Nina Dry Season | +1 | 39.6% (3566 d) | +4.07% | +1.76pp | 2022 La Nina, 2020 La Nina, 2010 La Nina | |
| Neutral ENSO | 0 | 12.8% (1155 d) | +3.12% | +0.81pp | 2019, 2014, 2013 | |
| El Nino Dry Season TODAY | -1 | 47.6% (4286 d) | +0.61% | -1.70pp | 2026 (current), 2023, 2015 |
The historical pattern
Signature episodes in the 36-year sample
What this measures
Signed NOAA Oceanic Nino Index, z-scored on a 120-month rolling window and tanh-bounded, then weighted heavier during the Brazil Arabica dry season (May through September) and flowering window (September through January). Positive composite equals La Nina conditions during the yield-sensitive window, which is bullish Arabica; negative composite equals El Nino conditions, which is bearish Arabica.
Why it matters
Why ENSO reads Arabica supply
Brazil produces roughly 35 percent of world Arabica, concentrated in Southeast Brazil where precipitation is strongly modulated by the El Nino Southern Oscillation. Pacific sea-surface temperature anomalies translate through Walker-Hadley circulation changes into Southeast Brazil rainfall anomalies that persist through the May-September dry season and the September-January flowering window. The signal weights the NOAA Oceanic Nino Index by these biologically-relevant windows, signed so La Nina conditions during yield- sensitive periods read as positive composite.
How to use this signal today
Primary long-lead supply read on Arabica with a 3 to 9 month lead horizon. La Nina dry-season firings (composite above plus 0.5) historically coincide with Arabica rallies; El Nino dry-season firings coincide with Brazil-loose regimes. Pair with the Cecafe realized-price signal (short-lead confirmation), ICE Europe COT positioning, and USDA FAS Brazil coffee attache reports when the mechanism fires toward either extreme.
Risk overlay
Validation rests on daily Spearman IC plus 0.098 (p-value 1e-20, N = 8,947) with sign-consistent non-overlap test at 60-day sampling (p-value 0.23, not independently significant). 3.46 pp directional spread between Phase +1 and Phase -1. Primary risks are (a) ENSO transitions can take months to resolve, (b) Brazilian frost or other non-ENSO shocks can override the signal, and (c) off-window readings carry less information than in-window readings.
Signal consumers and siblings
Not investment advice · The analysis on this page is informational and educational. Signal readings, historical case figures, and empirical statistics are derived from publicly available data and are provided without warranty. Hypothetical performance results have inherent limitations, including the benefit of hindsight. Readers who intend to trade should consult a licensed investment professional and see the research brief for the full disclaimer.
Last refreshed Nov 05, 2026 05:00 PM ET