Severe flooding has crippled Brisbane, the 3^rd largest city in Australia, with devastating results. Tens of thousands of homes and businesses are projected to sustain severe damage by the floods and at least 22 lives have been claimed with dozens still missing. Heavy rain during Australia’s wet season, which typically lasts through March, is to blame for the overflowing rivers and creeks, however, there is a much larger force driving these heavy rain events. In 1974 and 1955, comparable widespread, severe flooding swept across southeast Queensland with similar, devastating results. Like 1974 and 1955, today we are experiencing a strong La Niña event which is playing a big role in fueling the heavy rain.

The www.wt360.com forecast for Brisbane shows that the heavy rain is projected to slacken within the next 2 weeks, however, the rainy season in eastern Australia is far from over and so is La Niña, which is expected to gradually weaken through the southern hemisphere’s Autumn.

 Rainfall is forecast to be above normal for February and March 2011 in eastern Australia (see maps below) so Queensland may not be out of the woods yet. On the bright side, impacts from a tropical cyclone appear to be unlikely for the next couple of weeks in eastern Australia.

The Australian economy is taking a major blow from this natural disaster as the agricultural rich region of southeast Queensland is getting virtually consumed by flood waters, as seen in this satellite image of Ipswich, a suburb of Brisbane.

The coal industry in Queensland has shut down costing millions in deferred exports and impacting global prices. Vegetable, fruit and sugarcane crops have been wiped out causing food prices to skyrocket across eastern Australia. Industry experts predict that the flooding could cut 1% off of growth in Queensland which is equivalent to AUS$13 billion and 0.3% of Australia’s GDP. Queensland Premier Anna Bligh stated that cleanup and restoration costs could be of post-war proportions. Additionally, the flood threatens to jeopardize the Australian government’s pledge to return to surplus by 2012-2013 as financial aid assistance will put a strain on the budget. This event could end up being the single, costliest natural disaster in the history of Australia. Although flooding in Brisbane is reported to be not as severe as the 1974 floods, major development of previously unoccupied land in the city has put more people and property at risk.

To view the short and long-range forecast for Brisbane or any location in the world, visit www.wt360.com

U.S. DECEMBER 2010 SUMMARY: Although temperatures trended warmer than last year for the nation as a whole, the retail December 2010 still ranked as the 3^rd coldest in 18+ years. Colder and drier weather ensnared the Eastern half of the U.S. while a different story played out in the West with warmer and wetter weather. The crucial final weekend before Christmas played out favorably for the northern half of the nation as drier weather prevailed, however, the West and Rocky Mountains did not fare as well. A series of Pacific storms pounded the Western U.S. bringing flooding rains to CA, AZ and NV and excessive snow of 10-20 feet to the Sierra Mountains. Despite snowier conditions in the Southeast, Southwest and Northwest, snow was the least in 3 years for the U.S. as a whole. Immediately following Christmas, a major Nor’easter churned up the East Coast but only brought impacts to New Jersey and the New York City area where 1-2 feet of snow brought travel to a standstill. Retailers heavily based in this area would have felt an impact from this storm, but most were relatively unscathed.

Colder than normal temperatures helped to drive demand of seasonal items like firelogs, heavy outerwear, comfort foods, etc. The West was the challenging spot this month with exceptionally wet weather dampening store traffic. A drier and less snowy retail December was a benefit to retail sales and will help to push same-store-sales above Wall Street expectations. Given the favorable weather and improving economy, WTI expects sales to come in at +4.5%.

U.K. DECEMBER 2010 SUMMARY:  The retail December 2010 was a very challenging month for retailers as exceptionally cold and snowy weather kept many consumers hunkered down at home and resulted in the loss of holiday sales. Temperatures were the coldest in over 100 years for the U.K. as a whole, while precipitation trended the driest in at least 30 years. The first 2 weeks of the month saw temperatures trending much colder than last year and normal with snowfall disrupting travel in Scotland and northern England. A very brief respite arrived during the 2^nd weekend of the month with temperatures trending warmer than last year, however, colder temperatures and snow quickly returned in the following week. Southeast England and the southern Midlands experienced the worst of the wintry weather’s impact during the weekend prior to Christmas. Snow and icy roadways continued to be an issue in the final days leading up to Christmas. Milder weather came a bit too late to save the 2010 holiday shopping season as the final week of the month was the first week to trend warmer than last year since early November.

Bitterly cold temperatures and snow were favorable for items like heavy outerwear, car batteries, comfort foods, body lotions, heaters, snow removal items, etc. However, footfall was severely impacted by the cold and snow. Gift categories will have struggled this year since many consumers’ shopping plans were altered or all together canceled due to the poor weather and travel conditions. Although colder weather lingered into Boxing Day, travel conditions were much improved over previous weeks and retailers, especially in London, reported heavy footfall. Milder weather following the Christmas holiday was favorable for footfall as consumers browsed post-holiday sales and rushed to beat the VAT increase in January. Overall, like-for-like sales are expected to come in below expectations when they are announced later in January.

G-20 DECEMBER 2010 SUMMARY: December 2010 was a particularly chilly month for many as G-20 temperatures trended -1.3^o C colder than last year. The eastern United States and northern Europe were dealt the biggest blow from Old Man Winter with bitterly cold and snowy conditions. Cold and snow persisted through the first 3 weeks of the month in northern Europe with snow affecting many areas unaccustomed to snowfall. A forest fire in Israel at the start of the month was one of the worst in their history and was brought on by windy and dry conditions. Shortly following the fire, a powerful cyclone pounded the eastern Mediterranean and Middle East with torrential rains and high winds. Although the storm brought some short-term disruptions to shipping activities, it did help to alleviate a prolonged drought in Syria, Lebanon and Israel. Shipping operations were also disrupted in Central America as weeks of torrential rain forced the first ever weather-related closure of the Panama Canal on the 8th and 9th of December. Rain affected Colombia, Panama and Venezuela resulting in mudslides and flooding.

Winter seasonal categories were the favored items in the eastern U.S. and northern Europe, however, abnormally severe conditions in northern Europe made travel difficult and kept many consumers at home. Particularly perilous conditions just prior to Christmas resulted in the loss of last minute shopping sales and dampened gift category demand. During the lengthy cold outbreak, energy prices in Europe increased which impacted consumer’s discretionary income. In the southern hemisphere, colder weather was a negative for Spring seasonal categories with eastern Australia seeing especially poor conditions as cooler and wetter (flooding rains in some areas) dampened seasonal demand and store traffic. Of course, any of the areas that were struck by flooding this month will have seen store traffic numbers affected with a spike in demand for clean up categories. Flooding also endangered crops for farmers, like the coffee crops in Venezuela.