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The Value of Weather Insights in the Era of COVID-19

Coronavirus   |   Data Science and Technology

By Mark Gibbas  |  June 25, 2020

Weather is a market force that touches nearly every industry. When combined with the unprecedented shock waves of the ongoing COVID-19 pandemic, the effects of weather are compounded.

Weather impacts stock and investment values in time scales ranging from hours to years. From the spread of the virus itself to second- and third-order effects like supply chain disruptions, the value of alternative data such as weather is more important than ever.

Viral Hotspots

Many experts believe colder temperatures and lower humidity levels could lead to greater COVID-19 viability and weakened immune systems. Therefore, the combination of cold, dry conditions and diminished immune response has the potential to accelerate virus transmission.

A study conducted by Sun Yat-sen University in Guangzhou, China, concluded COVID-19 is sensitive to higher temperatures and that there may be an optimal temperature for transmission—47.69°F.

Based on this hypothesis, Figure 1 shows that climatological conditions in Wuhan, China, were conducive to COVID-19 transmission when the outbreak was first detected in December 2019. Figure 1 visualizes where climatological average temperatures from 40°F and lower are common for December across the globe. The intent is to highlight where COVID-19 could be more viable and transmissible.

Figure 1

Weather Source Figure 1

Source: Weather Source (as of June 10, 2020)

Conversely, Figure 2 reveals where climatological average temperatures from 70°F and higher are common for July across the globe. The intent is to highlight where the population could potentially experience some respite from COVID-19 in the summer months.

Figure 2

Weather Source Figure 2

Source: Weather Source (as of June 10, 2020)

Given the possible correlations, Weather Source is offering a sample dataset specifically for researchers working to understand the relationship between COVID-19 and weather. This information can be useful for epidemiologists and public health officials as well as for business leaders. 

Supply Chain Disruptions

As concerns about COVID-19's impact on the global supply chain continue to grow, it's more important than ever to monitor other potential disruptors such as weather. Prior to COVID-19, it was easy to source products from all corners of the globe. Today, low-risk, more localized supply chains are needed, but it is essential to pay close attention to any element such as weather that could affect supply chains at the local level.

For example, unseasonably cold temperatures over Eastern North America this spring delayed planting, which may soon lead to a shortage of produce for restaurants and grocery stores. Figure 3 shows a 30-day temperature anomaly for April 19 to May 19, 2020, with blue representing colder than the average temperatures.

Figure 3

Weather Source Figure 3

Source: Weather Source (as of June 10, 2020)

As demand rises for local suppliers that are less at risk for disruption, weather will be a key factor in quantifying and predicting the success of existing and new supply sources.

Strategic Planning

In the COVID-19 economy, major industries such as retail, food service, air travel, and energy have been turned upside down. Weather is more important than ever as entire verticals determine how to pivot and embrace new opportunities.

As people around the globe stay close to home and the demand for ethanol plummets, so too does the demand for the corn needed to make it. Affected corn farmers need to devise a strategy around new crops to remain viable and weather can play a critical role in solving that financial puzzle. 

Likewise, COVID-19 drove retail and food service to online business models focused on home delivery. Whether you have bicycle couriers transporting takeout or UPS drivers ferrying packages, weather is the number one cause of delivery delays. Companies equipped with a weather strategy will rise above the competition in this changing landscape. 

COVID-19 has also led many organizations to take long-term risk planning and mitigation as a requirement to adapt to climate change more seriously. Reliance on traditional, year-over-year weather trends can be less effective as this method doesn't take anomalies into account. Weather dataclimatology in particularcan be a powerful tool to determine average weather conditions and predict anomalies as investors analyze what regions will be less viable throughout the COVID-19 crisis and beyond. 

For more information on Weather Source, visit the Open:FactSet Marketplace

The material presented is for informational purposes only. The views expressed in the material are the views of the author and are subject to change based on market and other conditions and factors.

This blog post has been written by a third-party contributor and does not necessarily reflect the opinion of FactSet Research Systems Inc.

Analyzing_SupplyChains_Industries_COVID19

Mark Gibbas

Founder and CEO, Weather Source

Mr. Mark Gibbas is the Founder and Chief Executive Officer of Weather Source, which is a leading provider of weather and climate technology. During his time, he developed a vision for a scalable weather-operating system that could serve clients across any industry and provide information relevant to their specific needs and locations of interest. Weather Source's OnPoint Platform and related products provide actionable weather insights to a growing list of top-ranked companies. 

Prior to founding Weather Source, Mr. Gibbas applied his expertise in meteorology and computer science at Applied Insurance Research (AIR) and TASC. He developed a long-range forecasting system that laid the foundation for such technology at WSI and The Weather Company and has worked on projects for the United Nations' World Meteorological Organization, where he advanced the meteorological capabilities of several Latin American countries. Mr. Gibbas eared a BS of Meteorology, minoring in computer science and mathematics from Plymouth State University.

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