In 2023, Salient partnered with AB InBev, the world’s largest brewer, to understand the opportunities that reliable, accurate seasonal to sub-seasonal (S2S) weather forecasts can unlock for their business via the 100+ Accelerator. Here’s what we learned. 

What causes the most variability in crop production? The weather. 

Weather causes the most variability in crop production – not soil, land, farmer skill, or plant genetics – the weather accounts for 40-80% of variability in crop yields. 

‍As weather volatility increases, corporate earnings and farmer incomes are at risk. 

The range of possible weather outcomes is greater than ever before, making historical climate data less useful. For example, if a drought sets in over a season, crop yields can decrease from 35 to 5 bushels per acre. 

Reliable, accurate weather forecasts beyond 2 weeks are possible

Salient’s mission is to forecast further, leaving historical averages in the past, and to break through the limit of short-term forecasts. 

Salient’s machine learning model finds patterns in ocean and land data that drive weather on the S2S (seasonal to sub-seasonal) time horizon. The system we’ve built enables forecasts up to one year ahead with higher accuracy and better reliability than any other forecasts available today. 

Smart Weather Insights for AB InBev

Salient conducted a pilot with ABInBev’s North American agronomy group, with attention to procurement and trading as well. Volume, quality, and risk were each pieces of the puzzle.  

As we built the business case together, we looked at examples of what AB InBev could have done in recent years with accurate, reliable S2S weather forecasts. 

For example, in 2021 there was a major drought in the upper midwest – fields simply didn’t have enough moisture to support barley and oat crops. Salient caught the signal of the group in August of the prior year. In March 2023 we forecasted below-normal precipitation for the entire May - July period, two to five months in advance. This is just one example among many where Salient's probabilistic forecasts can help better plan for the weather. 

Salient’s collaboration with AB InvBev reveals the actions and decisions corporate teams can make with this type of advance information: 

1. Procurement would account for decreased yields in their planning, contract more grain, and shift regional allocations to save money on transfer costs. 
2. Agronomy would advise farmers to apply less nitrogen to improve grain quality and acceptance rate. 
3. Trading would anticipate price and supply risks, improving hedging and forward contracting. 

But it’s not just economics. When we factor in the community implications of farmer incomes and the ecosystem implications of the environment, there’s a win-win-win opportunity. 

‍Turning Weather into a Competitive Advantage

Weather impacts every industry. The opportunities and potential impacts for Salient are nearly endless. Salient helps customers – most frequently in the energy, agriculture, and insurance sectors – turn weather into a competitive advantage.  We partner with companies focused on reducing their risk, making more money, and improving the resilience of mission-critical supply chains. Thank you, AB InBev, for being on this journey with us.