SEOUL, KOREA - IBK Investment & Securities said on June 22 that the possibility of an "El Nino" in the upcoming summer, the first such a global climate event in 17 years, merits a review on related stocks. Kim Jung-hyun, analyst with IBK Investment & Securities, said, "Recently the Australian Bureau of Meteorology announced the probability of an El Nino occurring this summer is as high as 70 percent. Once it happens, it is inevitable that grain prices will rise rapidly in regions such as Southeast Asia, India, Australia, and South America."

 

As the stocks to benefit from the climate event, he picked Namhae Chemical Corp., the nation's largest fertilizer supplier, and Nongwoo Bio, the vegetable seed company. Non-ferrous metal stocks will also be affected by the El Nino as major non-ferrous metal-producing countries such as Indonesia and Peru will be damaged by droughts and floods that may drive up the prices of these primary commodities. Major non-ferrous metal stocks include Korea Zinc, DS Steel, and Hyundai BNG Steel.

 

Stocks of still other companies such as Dongwon Industries and Silla Co. Ltd. with large tuna fishing fleets are also expected to rise due to an El Nino. But these companies saw their share prices fall recently due to a movement in the EU to designate Korea as a country practicing IUU (illegal, unreported, and unregulated) fishing.