Weather risk experts say early summer heat and a busy Atlantic hurricane season, on the heels of an already busy severe weather season, could have a negative impact on the economy.
Paul Walsh G2 Weather Information Analysing weather risks for businesses, the managing director said this summer’s weather forecast could pose problems for businesses and consumers across many sectors.
“This summer weather forecast is the most dangerous I’ve ever seen,” Walsh told Fox Weather.
Walsh said he’s most worried about the forecast heatwaves of summer and the possible health impacts.
Heat warnings have already been issued for parts of California and the Southwest as meteorological summer begins, with temperatures expected to top 100 degrees this week.
Another reason Walsh is worried after the heatwave is the possibility of a busy hurricane season: NOAA has issued its most severe forecast yet for the 2024 hurricane season, predicting between 17 and 25 named storms are possible.
“When you combine all of those factors — the health risks from the heatwave we’re seeing right now, the air pollution in the background, the potential for wildfires later this summer, and then of course the hurricane forecasts and expectations that we may have a record number of storms, at least this hurricane season — you paint a pretty scary picture of a summer season in terms of weather risk,” Walsh said.
Extreme weather has the potential to disrupt any market, so more companies are entering the weather data market, Walsh said.
“If you think about energy companies, agricultural companies, insurance companies,[they’re]all pretty sophisticated in their use of weather data and weather analytics,” Walsh said, “but more and more companies — consumer goods companies, retail companies, other companies, pharmaceutical companies — are starting to use weather data and weather forecasts using what are called seasonal forecasts, like hurricane forecasts, which are seasonal forecasts that help them think about how to be better prepared.”
Companies use technology to prepare reserves before weather disasters
If there’s a silver lining to the rise in weather events, it’s that weather forecasting is improving, and companies are using machine learning and artificial intelligence to get ahead of weather events.
“For example, Strawberry Pop-Tarts – the famous Walmart story of them running out of Strawberry Pop-Tarts if there’s a hurricane threat – but the ability to leverage data analytics has allowed companies to become more precise and sophisticated enough to understand what we need,” Walsh said.
The New York Times Walmart began using forecasting technology two decades ago to gauge what customers would buy ahead of a hurricane’s impact, which is one reason the retail giant stockpiles strawberry Pop-Tarts before a tropical storm hits the US.
“We’re becoming better equipped to prepare for high-impact events like this,” Walsh said.
This is what Walsh calls “digital resilience” to better prepare for increasingly frequent extreme weather events.
