Archive for February, 2011

Weather Futures and Options
February 28, 2011

***Watch WISN 12 News for the latest weather information!***

Thank you for stopping by the Weather Watch 12 blog! The topic in this blog is one we have never discussed before, and one that will likely generate a good deal of discussion.

Recently I learned about Weather Futures and Options that are available at the Chicago Mercantile Exchange. The weather trading is available for snowfall, rainfall, and temperatures. In other words, you can now invest, or as some may view it, gamble on the weather.

Roulette Wheel

On February 22 I traveled to the Chicago Mercantile Exchange, or CME Group, to meet with Jeff Hodgson. Jeff is the President of the Chicago Weather Brokerage, part of CME Group. Here is a picture of Jeff.

Jeff Hodgson - Chicago Weather Exchange

I interviewed Jeff for just over 20 minutes on what weather futures and options are all about, who may be interested, and is it essentially gambling on the weather?

Let’s start with how the CME Group describes this market:

One-third of businesses worldwide are directly affected by weather conditions. These products enable you to manage weather-related risk while also offering opportunities to speculate — absorbing that risk in exchange for possible profit on weather variations. Our weather product suite offers trading opportunities related to temperatures, snowfall, frost and hurricanes. The products are based on a range of weather conditions in more than 47 cities in the United States, Europe, Canada, Australia and Asia, with the hurricane products geared to nine U.S. regions.

The website for the weather products offered from CME Group is below.

http://www.cmegroup.com/trading/weather/

My conversation with Jeff was fascinating because it has been a goal of mine to figure out how this market works. While anyone can participate, it is geared toward businesses that are weather dependant. Here are some of the questions that I asked Jeff during my visit, and his response.

What is a future or option and how is a trade executed at a very basic level?

“It is a trade, you could be a client who has a natural exposure to the weather. I would go out and get the financial participants to compete for your business in essence. Once we have a fair price or the best price possible, and you believe its a fair price, we match those trades up and then they are reported to the Exchange.”

Can farmers or those in the agricultural industry benefit from these trades, if so how?

“What the rainfall derivatives enable a farmer to do, in place of crop insurance or on top of crop insurance, is it gives you a tool to manage your own risk.”

“So insurance you don’t have anything until the end, this actually has a day to day value that is in my opinion something that could completely change the agriculture market.”

Besides snow removal and salt companies, who could benefit as the seasons change with rainfall contracts?

“You have the agriculture market. I think you have the pest control industry, you have large golf course exposure in the Milwaukee area.”

So does Jeff feel that this is gambling on the weather?

“If your business is dependent upon the weather you are actually gambling by not participating in this marketplace, because your revenue is driven off of something you cannot control. So by you not participating and by not hedging this, you are actually the gambler.”

Here in southeast Wisconsin I talked about trading on the weather with Fritz Frazier, owner of Winter Services, a local snow removal company. Snow, too much or too little can make or break his business. While Fritz said he has not bought a snowfall future or option yet, he is considering it for the future, here’s why.

“Buying salt, buying new equipment, buying trucks, and your getting that all over the state of Wisconsin trying to get ready. And if it doesn’t snow that’s a big issue”

“So as a small business it’s really nice to be able to have weather futures like that.”

Here is a picture of Fritz(first person in line) and his team.

Winter Services Team

Weather trading is relatively new to the CME Group, it is growing rapidly as 2-3 trillion dollars of economic output if affected by weather! While it is investing and hedging a potential weather risk, it is an investment and that means you could make or lose money!

What do you think about weather futures and options? Let us know in the comments section of the blog!

Have a great day!

Jeremy Nelson

Advertisements

March Forecast – Based on Lezak’s Recurring Cycle
February 27, 2011

***Watch WISN 12 News for the latest weater information!***

Thank you for stopping by the Weather Watch 12 blog!  Back in December of 2009 I posted the first long range weather forecast based on the LRC right here in the Weather Watch 12 blog.  Since that time many have learned about the LRC, and many are just beginning to follow this remarkable weather pattern theory that I was first introduced to in 2006. 

The ‘LRC’ which stands for Lezak’s Recurring Cycle is a weather pattern theory based on the following:

  • A unique weather pattern sets up every year between October 1st and November 10th
  • The weather pattern cycles, repeats, and continues through winter, spring and into summer. Identifying the cycle length helps tremendously when making long range weather predictions.
  • Long term long-wave troughs and ridges become established and also repeat at regular times within the cycle. These dominant repeating features are a clue to where storm systems will reach peak strength, and where they will be their weakest.
  • The LRC is a winter-long pattern! There is a pattern! It isn’t just one long-wave trough, storm system, or ridge. It is a sequence of troughs and ridges that are cycling across the Northern Hemisphere.

To put this in very simple terms, the weather pattern that occurs in October and November repeats thru the Winter, Spring, and into the Summer. The cycle length will vary each year. I’ve seen cycles of 42-46 days, 60-62 days, etc.

The easiest way to view the LRC is to look at maps in the middle of the atmosphere, the 500mb level. The 500mb level is really a good spot to analyze the trough(lows) and ridge(highs) positions to help determine the long term longwave ridges and troughs. At the 500mb level you also don’t have to factor in friction or surface moisture. The theory can be translated down to the surface(where we live), which we do in this long range forecast.

As I have mentioned many times, this year’s cycle duration is about 46-52 days.  Overall most of the weather events have repeated about 47-51 days apart.  After analyzing the pattern and surface results from October through February, I was able to get a very good idea of what should occur this March.

Here in Milwaukee the averages begin to take on a more Spring-like feel as the month progresses.  And the average montly snow total also takes a noticable dip from February.

  • Average High March 1st  37
  • Average High March 31st  48
  • Average March Snowfall  7.4″ 

———————————————————————————————-

Here is the March 2011 long range forecast!

March 1-7

The first week will see plenty of quick ups and downs in temperatures.  The coldest day of the first week should be Wednesday, March 2.  By late in the week, around March 5 the part of the pattern will return that produced this upper low over the north-central U.S. back on November 25-26, or 2 cycles ago.  Below is the archived 500mb map from November 26.

500mb November 26, 2010 

As this part of the pattern returns, I expect a round of precipitation, and the possibility of accumulating snow. 

March 8-14

Early in this period a storm system is possible around March 8-10.  Rain, a mix, or snow is possible.  The storm should be followed by a strong push of cold air, possibly the coldest temperatures that will occur during all of March!   This part of the pattern has repeated 3 times so far in this year’s LRC.  And I expect it to repeat again!  Here is how the 500mb flow looked each time through this part of the pattern.

As the new pattern was just beginning to reveal itself, this feature first occurred on October 14, 2010.

500mb October 14, 2010

Then, 48 days later the pattern repeated on December 1, 2010.  The upper low fell into the long term longwave trough once again.

500mb December 1, 2010

51 days later, during the 3rd cycle of this year’s LRC, this same feature paid a visit in January.  This produced the coldest surface temperatures of the month in Milwaukee!

500mb January 21, 2010

This period could end with another system moving by around the March 13-14 timeframe with another chance of precipitation.  Week two looks to be very active in southeast Wisconsin.

March 15-21

This week may get lost in the shuffle because all eyes will be on week 4 of March.  But let’s touch on this period.  Before the ‘signature’ storm arrived in both December and early February it was preceded by a couple of ‘clipper’ systems.  With a seasonal shift of the jet stream starting to lift back to the north, I expect the bulk of the precipitation with these events to be rain, and fairly light.  Can’t rule out snow, but I think temperatures will moderate some during this period, and with average highs in the 40s by then, snow is tougher to come by with ‘clippers’.

This period will end with the ‘signature’ storm on the doorstep.

March 22-28

Week 4 will bring the return of the ‘signature’ storm to the Midwest.  This feature has shattered weather records in some form each time through the cycle.  Here’s a look:

  • October 26, 2010    Storm produced a tornado in Racine county & the lowest central pressure ever recorded in Wisconsin!
  • December 11-12, 2010  Heavy rain and snow fall in southeast Wisconsin.  Nearly a foot of snow in parts of Washington County.  Blizzard conditions in parts of the Midwest, another very windy storm!
  • February 1-2, 2011  Possibly the worst blizzard to hit southeast Wisconsin since 1947!  Nearly 2 feet of snow in spots, winds gust to 60mph at Milwaukee’s Mitchell Airport

Here is the surface map from the morning of February 2, 2011.  An amazing storm!

Surface Map February 2, 2011

While predicting another record smashing storm is tough.  The ‘signature’ storm should return around March 22-24 and I am expecting a classic Spring storm with a severe weather outbreak in the warm sector, and a major winter storm in the cold sector. 

Each time through the cycle over a half inch of liquid precipitation has been measured.  This is one of the wettest storms in this year’s pattern.

The big question is what will southeast Wisconsin see?  I would lean to a rain to snow, with gusty winds with this storm.  Behind the storm a push of cold air will settle in to the region. 

March 29-31

After the ‘signature’ storm passes one more ‘clipper’ type system will move by, and then a push of cold air to close the month.  Temperatures the last day or so of March should be below average, and the cooler weather should last into early April. 

———————————————————————————————-

For the entire month of March here is what I am expecting.

Snowfall: Above Average

Precipitation: Near Average

Temperatures: Below Average

 

Those are my thoughts on March based on the LRC.  While many are hoping for an early Spring, I just don’t see it this year for Wisconsin.  However, I do think the first good chance at highs in the 70s may be around April 7-11. 

If you have questions please post them to the comments section of the blog.  Please feel free to share this blog entry with anyone you know!

Have a great day!

Jeremy Nelson

Storm Slides By – Close Call Tonight
February 27, 2011

***Watch WISN 12 News for the latest on the storm track!***

Thank you for stopping by the Weather Watch 12 blog!  The storm system that we have been tracking over the past several days will slide by to our southeast tonight.

Just click on the interactive radar link below for a current look at the radar.

www.wisn.com/irad

The big question is how much, if any, precipitation will fall.  Then the next question, in what form?  Let’s start with the latest data from Sunday afternoon.

Let’s start with our in-house model the RPM.  This forecast shows that all of the precipitation stays south of Wisconsin.  Keep in mind this is only one model that we look at. 

RPM Total Precipitation Tonight

The 18Z NAM model is also forecasting a southward trend for the precipitation.  This would at least graze far southeast Wisconsin with a mix or some light snow.  In this scenario areas near the WI/IL border could see a dusting to maybe 1″ of snow. 

NAM Total Precipitation Tonight

The last solution to look at below, is the 18Z GFS total precipitation.  This has the moisture farther north, meaning 1 to 3 inches of snow would be possible closer to the WI/IL border.  The GFS would also put more wintry mix/snow in the Milwaukee area.

GFS Total Precipitation Tonight

Since it wouldn’t take more than just a slight shift to the north for our area to be in the slightly heavier precipitation, we will be nowcasting and tracking any slight shift in the track on WISN 12 News.

I still think here in Milwaukee we could see a light mix for a time, but most of what occurs that accumulates will stay closer to the WI/IL border. 

Look for the long range March forecast in the blog later this evening!

Jeremy Nelson

Active Pattern Continues – More Snow
February 26, 2011

***Watch WISN 12 News for the latest weather information!***

***Look for the long range March forecast in the blog Sunday evening!***

Thank you for stopping by the Weather Watch 12 blog!  The weekend started snowy, and has the potential to end with more precipitation Sunday and Sunday night.

Before we tackle Sunday, let’s discuss the round of snow that moved through on Saturday.  About 1″-3″ of snow fell in areas from Madison east to Milwaukee and points north.  A few spots saw around 4″!  South of this line there was generally closer to an inch…or even less.

Please post your snow totals in the comments section of the blog.

Below is a forecast map from our in-house computer model the RPM at 3am Sunday.  This shows the light snow tapering to flurries. 

RPM Saturday Night

Remember to track rain, sleet, or snow day or night right down to where you live, just click on our interactive radar!

www.wisn.com/irad

As one system moves out, the next one arrives on Sunday.  Milder temperatures will try to push north, and this will likely mean some flurries or patchy light snow early Sunday, will transition to a light mix by later afternoon.  Even a chance of a period of all rain/drizzle.  The best chance of a period of rain would be closer to the Wisconsin/Illinois border.

This storm system will put southeast Wisconsin on the edge, and make for a tricky forecast late Sunday and Sunday Night.  We are always analyzing the latest data in our weather center, as new information comes in about every 3 to 6 hours.  So as of this writing here is the big question for late Sunday.

The question is how far north will the main area of precipitation move, and will it be cold enough for snow?

The 18Z NAM(North American Model) forecast has temperatures warm enough that it would keep precipitation as very light rain/drizzle at midnight.  A littler steadier rain may be located near the Wisconsin/Illinois border.

NAM Model Sunday Night

Another model that we use to forecast has the steadier precipitation farther north, and colder temperatures in place.  Below is the 18Z GFS(Global Forecast System) forecast for 12am Monday.  A huge key to the map is the solid blue line over far southeast Wisconsin.  This line is the 850mb temperature.  And this particular line represents the 0 degrees celcius line, or the freezing line 1500 meters above the ground.

Often times this can be used as the rain/snow line.  If this model plays out snow would be possible Sunday Night from Milwaukee back to Janesville, and it may be enough to accumulate!

GFS Sunday Night

There is a huge difference between these two models…and not much time before Sunday Night arrives!  The track of the surface low will be a key to this forecast, and right now I’m forecasting some light snow/flurries Sunday morning with a change to a mix in the afternoon(possibly some light rain, best chance near the border), and then a change back to a period of snow Sunday Night.

I think the first computer model map that I showed is too warm, simply based on how far south the cold air dropped on Saturday, and neither model above picking up on that trend.  So a slightly colder solution is where I will lean for Sunday! 

On a side note lots of exciting things coming up.  First, I will post the long range March forecast in Sunday evening’s blog.  This was delayed a bit because I have been working on a special story that will air Monday during the 10pm News!  It is called ‘Trading on the Weather’  I recently visited the Chicago Mercantile Exchange Group where Weather Futures and Options are now being traded!  A unique story that will have you asking…is this gambling on the weather?

Watch WISN 12 News for the latest on the weekend forecast!  Make sure to post your thoughts or questions to the comments section of the blog!

Jeremy Nelson

Saturday’s Snow and Sunday’s Storms
February 25, 2011

*9:15 PM UPDATE…LATEST COMPUTER MODEL RUNS PUSHING LOW MUCH FARTHER SOUTH! SO FAR SOUTH WE MAY BE ON ABSOLUTE NORTHERN FRINGE OF PRECIP. COLD AIR MAY WIN THE BATTLE TO PUSH THE LOW WELL TO OUR SOUTH. STAY TUNED. WAITING ON GFS, BUT NAM AND RPM MUCH FARTHER SOUTH. ANOTHER FUN FORECAST.

MARK

Welcome to the weekend. It is going to be a busy weekend in the weather center with two different systems to worry about. The first starts tonight and lasts off and on through Saturday evening. This will be all light snow. One of the big factors generating the snow is the big temperature contrast from north to south across our area. This is known as a baroclinic zone. The official definition according to the NOAA Glossary, a “baroclinic zone” is: A region in which a temperature gradient exists on a constant pressure surface. What does that mean for our weather? It means that we will see additional lift in our area to generate light snow. This will be a long-duration light and powdery snow. Take a look at the temperatures this evening. Note the big area of unseasonably cold air just to our west.

Here is the RPM for 3pm Saturday:

The light snow will start on Friday night, then a likely break on Saturday morning, followed by more light snow on Saturday afternoon and evening. Here is the accumulation product for the RPM Saturday’s snow.

A general 1″-2″ of snow is likely. Enough to make the roads slippery, but should not cause any major problems.

The next storm arrives on Sunday night. This will be a powerful storm, but most of the computer models bring the low close to Milwaukee. That means that warm air will be brought all the way into Wisconsin. I would not be surprised if we hit 40 degrees on Sunday. My only concern is the big area of very cold temperatures just to our west. I’m nervous because an air mass like that can be tough to budge. If it holds here long enough, I would be concerned about a more southerly track and the possibility of freezing rain or sleet here. At this point, I don’t think that will be the case. It actually looks warm enough to support a few thunderstorms early Monday morning. Take a look at the RPM for 3AM Monday.

This is definitely one that you will want to watch as it gets closer. Stay tuned to Weather Watch 12 for the latest.

Mark

Storm #1 Misses, Storm #2 Bulls-Eye
February 24, 2011

It is certainly close, but it looks as though the storm that is hitting just to our south will stay there. Kenosha county is under a winter weather advisory, but I don’t think that is warranted. Light snow is possible right along the border, but I only expect about an inch of snow there. Only flurries in Waukesha and Milwaukee. Here is the RPM computer model at midnight tonight.

The heavy snow will stay across Northern Missouri, North-Central Illinois, and Northern Indiana. They could pick up 6-8″ tonight. This is the first big storm to miss us in quite a while.

The next storm does not look like it will miss us. Sunday night will bring a rapidly strengthening low pressure center, but at this point is looks wet and not white. There could be a substantial amount of rain, possibly over an inch, that could create some flooding problems. It will become very windy on Sunday and Monday. Here is the GFS model for midnight on Sunday night.

Note the blue zero degree line. This is very important along with the 540 line on the 500 mb chart. This is often the dividing line between rain and snow. Here is the 500mb chart from the GFS model for Sunday night.

Both the zero line and the 540 lines are well north of SE Wisconsin. If the low stays on this path we are looking at mainly a rain event. As the low passes by on Monday morning cold air will wrap in on strong westerly winds changing the rain to snow, but because this will be the back side of the low there will be less moisture. Only minor accumulations are expected at this point. The storm is still four days away so a lot can happen to the track. Obviously, if it moves south that could put us in a path for more snow. Stay tuned.

Mark

Looking Ahead To Sunday
February 23, 2011

***Watch WISN 12 News for the latest weather information!***

Thank you for stopping by the Weather Watch 12 blog!  In looking over the models today, and the upcoming pattern, my eyes were drawn to this coming Sunday.  In today’s blog we’ll look ahead to another complex forecast in the final days of February.

Between now and then a system will travel to our south, there’s still a chance it would bring some light snow, but we’ll handle that on WISN 12 News in the next couple of days.

For now I want to look ahead to a storm system that will impact the area Sunday and Monday.  Of course before we look ahead to a storm, with the LRC we can always look back.

In the case of this coming Sunday-Monday, this part of the pattern would be associated with around January 10.  Below is the 500mb map from January 10 showing a trough with two upper lows over the Midwest and Plains.

500mb January 10, 2011

If we now jump ahead roughly 48-49 days we land on this weekend.  The 12Z GFS shows low pressure at the surface near Chicago.  This would push milder temperatures in our area, and also a chance of rain, sleet, and snow once again.

Sunday Surface Map 

While the final solution will shift around before this weekend, I do believe a mixed bag of precipitation will likely occur in southeast Wisconsin.  If you have travel plans Sunday into Monday, you can stay up-to-date with the latest forecast here and on WISN 12 News.

In the meantime, if you have questions or thoughts about this potential storm, please post them to the comments section of the blog.

Have a great day!

Jeremy Nelson

Next Storm Staying South
February 22, 2011

I hope everyone is done digging out from the last few days worth of snow. Anywhere from 1″ in the south to 15″ in Sheboygan and Ozaukee counties.  Last night’s forecast of 1″-3″ was good except for Ozaukee and Northern Milwaukee county. As much as 6″ of snow fell where a persistent lake-enhanced band of snow developed and lasted for much of the overnight hours.

Now, on to the next r0und. We will likely get a little light snow or drizzle late on Wednesday and Wednesday evening, but this should not amount to much of anything. The main show the rest of the week is a stronger low pressure center I mentioned yesterday in the blog. This low will move across the Southern Plains and Ohio Valley on Thursday night and Friday. As I anticipated, with the help of the LRC, the storm looks like it will stay to our south. Almost all the computer models have it staying well south of us. The exception is the Euro, but it is only brushing our southern counties. Take a look:

Here is the NAM:

Here is the GFS:

And finally, the RPM:

The thing to note with all of the models above is a substantial move to the south with the low over the last 24 hours. I feel confident that the low will stay to our south.

Thanks for reading an abbreviated blog. I’ve got to go lead a tour of Cub Scouts around the building.

Mark

Sunday’s Snow & Tonight’s Snow Forecast
February 21, 2011

Happy Presidents’ Day! It was another crazy weather day in SE Wisconsin. Totals ranged from 0″ to 14″. This makes forecasting a lot of fun, but quite stressful. Take a look at the totals map for our area.

Look at the incredible difference across Milwaukee county. From around an inch in Oak Creek to eight inches in Bayside. The heaviest totals were in our northern counties:

Oostburg: 14″, Random Lake: 13″, Cedarburg: 11″, Sheboygan: 10.9″, West Bend: 10″

Milwaukee received 2.8″. That brings our February total to 22.3″. This is 13.4″ above average for the month. The snow total for the season is 49.6″. 9.7″ above average.

This was a much different snow than the blizzard. The moisture content was very high. It was difficult to shovel because of all the weight of the water in the snow.

Another round of light snow is expected for tonight. As the temperatures drop, the lake enhancement could kick in. So far, that has not happened. I’m only expecting 1″-3″ across the area.

There is a winter weather advisory in effect until 6am Tuesday for all of SE Wisconsin.

It is a borderline advisory with most of the snow coming tonight and only 1-3″ likely. The wind will be brisk out of the east at 15-30 miles per hour blowing this powdery snow around.

After this round blows by, the questions arise about the next storm on Thursday night and Friday. Using the LRC, Lezak’s Recurring Cycle, let’s take a look at Friday’s storm versus the last time we had this pattern in early January. Let’s compare the GFS 500mb forecast map for Friday morning vs. January 6th of this year. There are some differences but the overall upper level features are there. The January pattern is more meridional. (More wavy) The forecast for Friday is much more zonal. (East to West).  The upper low on the west coast is in a significantly different position. Off California coast vs. Pacific Northwest. Truth be told, I’m not sure how this difference will impact our next storm. The last time this system came through it stayed well to our south. I would think the storm on Friday will also stay to our south.

I will be happy to hear from the LRC experts for their take on late this week. I’m still watching and learning. The LRC was a great help with Sunday’s storm. Most of you will recall the models were all over the place and too far south with the low for much of the week. Using the LRC as another model, it was very interesting to watch the models fall into line as the storm got closer. Thanks for reading.

Mark

Messy Mix To Snow, Continues Monday
February 20, 2011

***Watch WISN 12 News for the latest weather information!***

Thank you for stopping by the Weather Watch 12 blog!  It is not often we get a storm system to produce snow totals ranging from 1″ to 12″+ in our area, but that is where we are headed by the time this ends late Monday. 

For a current look at what type of precipitation is falling where you live, just click the link for the interactive radar below.

www.wisn.com/irad

A messy mix of rain/freezing rain/sleet/snow will change over to all snow Sunday Night.  The snow totals will continue to add up, here is a look at totals through 6pm Sunday.  Thank you to everyone who sent totals!  I’m trying to use some on WISN 12 News, and also here in the blog. 

  • Oostburg  10.0″
  • Fond du Lac  7.0″
  • Cedarburg  6.2″
  • West Bend  6.0″
  • Sheboygan  5″-6″
  • Merton  5.0″
  • NW Milwaukee  4.75″
  • Sussex  4.25″
  • Reeseville  2.0″
  • Greenfield  1.75″
  • Milwaukee Mitchell Airport  1.7″
  • Oconomowoc  1.5″
  • Hales Corner  1.0″
  • Kenosha  No Snow

 

By Monday, low pressure will slide into the Ohio Valley.  As colder air spills in and winds turn to the northeast, lake enhanced/effect snow will be possible.  The light snow will be steadiest in lakeshore counties on Monday.   Additional snow accumulations will be possible.

Below is the RPM forecast at noon Monday.  This shows the northeast winds, and also the snow(in blue).

RPM Snow Monday - Noon

Below is the NAM forecast surface map at 6pm Monday.  This would suggest the snow continues through the afternoon and that 1″-3″ of snow would be possible in spots Monday afternoon!

NAM Surface Forecast Monday

Final snow totals from Sunday through Monday will be around 9″-12″+ from Port Washington north to Sheboygan and west into parts of Fond du Lac county.  In Milwaukee and Waukesha totals should stay in the 3″-6″ range.  6″-9″ totals will be common around West Bend, Menomonee Falls, and back to Mequon.  1″-3″ for Lake Geneva and Kenosha.  A huge spread of snow from one messy storm! 

Please continue to post storm updates and snow totals in the comments section of the blog.  Look for updates on WISN 12 News!

Jeremy Nelson