Sally forecast to track as hurricane to New Orleans area Gulf Coast landfall

Hurricane Sally is forecast to form in the Gulf of Mexico and some forecasts suggest the potential for rapid intensification, with at minimum a Category 1 hurricane landfall now anticipated on the central Gulf Coast, not far from New Orleans.

Sally formed at the weekend as a tropical depression, then crossed the Florida keys and southern peninsula and headed into the Gulf of Mexico, becoming the 18th named tropical storm of the season.

Tropical storm Sally is now expected to become the seventh hurricane of the season soon, as the storm will feed off the very warm Gulf sea surface temperatures and then head slowly for the Gulf Coast.

Now, Sally is set to become the next landfalling hurricane to impact the United States coastline of 2020, a season that has already seen seven tropical storms strike the country and it has the potential to be another storm impact that drives some losses through insurance and into reinsurance markets.

Currently, Sally has maximum sustained winds of 65 mph, with higher gusts and a minimum central pressure of 994 mb that looks set to fall further over the next day.

Most forecasts suggest intensification, potentially rapid, right up until landfall in the New Orleans region, but also a slow approach with the potential for hurricane Sally to stall over the coast and some concerns building over the potential for prolonged storm surge and significant rains to occur.

Hurricane Sally will pose a major threat to low-lying areas as a result of the slow approach, which forecasters suggest could push a significant storm surge onshore for several hours.

Rainfall levels are also expected to be significant with hurricane Sally and the flood impacts are a concern, while wind impacts are down to just how much the storm can intensify by landfall now.

With a slow approach expected though and a forecast that suggests intensification right up to landfall, the outlook for hurricane Sally could be particularly dangerous for some areas of the Gulf Coast if the storm reaches significant wind speeds before reaching the shore.

As ever, for the reinsurance and insurance-linked securities (ILS) market, it is wind and surge that drive the largest costs to that end of the market, while rainfall related flooding tends to be largely uninsured, or dealt with by the NFIP.

You can see a modelled intensity forecast for hurricane Sally below (from TropicalTidbits.com):

Reinsurance broker Guy Carpenter explained that Sally will be travelling through an area of the Gulf where, “Both of the best predictors for strengthening are present; namely very warm waters and low wind shear.”

The reinsurance broker also explained that, “Steering currents will gradually slow the system down and bring it onshore along the Central Gulf Coast. The weakening steering currents mean the forward speed of the storm will slow, which is a concern for flooding from both storm surge and rainfall.

“The gradual slowing of the system also increases the uncertainty in the intensity at landfall. The water in the immediate coastal area is very warm; if Sally slows and spends more time over warm water it could allow for additional strengthening.”

Finally, Guy Carpenter said that while official forecasts may point to a Category 1 landfall, “As has been the case all season, the actual intensity and track forecast is still highly uncertain, and interests along the entire Central Gulf Coast, including New Orleans, should be prepared for a hurricane landfall and associated risks.”

Broker BMS Group’s Andrew Siffert explained some of the potential impacts from Sally,”The overall track is very important to the overall insurance industry impacts. As a shift in the current track guidance, east or west could greatly impact the storm surge and wind forecasts for the highly populated New Orleans area as the highest storm surge and wind impacts will be on the northeast side of the track at landfall. Clearly, if Category 1 winds go into the major metro area of New Orleans this will yet again be another billion-dollar loss event for the insurance industry this year.”

Siffert said the bottom line is, “The insurance industry should not take Sally lightly. It is never ideal to have an intensifying named storm approaching the coastline. This intensification will likely occur right up to landfall which puts a bit of a cap on how strong Sally can get; but, as we have seen this year, intensity forecasting has not been great and is a challenge when you have such a wide range of outcomes for the 12-18 hour period right before landfall.

“The angle at which Sally will impact Louisiana and Mississippi will maximize both storm surge and rainfall. Sally is forecasted to be a 90 mph storm. Moving at 5 mph, it will only traverse 150 miles in 48 hrs. New Orleans’ levee systems will be challenged. The angle at which the storm is tracking along the coast and the shallow waters in the area will funnel and raise water levels quickly as Sally ramps up in intensity. Currently, the storm surge is likely to be below 9 feet, but there is a chance that the forecast could change as Sally become better organized and surge values of 10 ft or more are possible.”

In addition, Plenum Investments, the specialist insurance-linked securities (ILS) fund manager, said this morning that based on forecasts of a Cat 1 hurricane Sally landfall it would not expect any exposed catastrophe bonds to be threatened.

Twelve Capital, another specialist manager in the ILS space, also said on hurricane Sally and also Paulette, “While these events are likely to cause dangerous storm surge and potential flooding, they are not forecast to develop into major hurricanes and neither are expected to have any significant impact on the ILS market.”

A peak storm surge forecast map for hurricane Sally from NOAA can also be seen below:

The latest update from NOAA’s National Hurricane Center can be seen below:

Sally is moving toward the west-northwest near 8 mph (13 km/h). This general motion is expected today, followed by a decrease in forward speed and a turn to the northwest tonight and a northward turn sometime on Tuesday. On the forecast track, the center of Sally will move over the north-central Gulf of Mexico today, approach southeastern Louisiana this afternoon, and make landfall in the hurricane warning area on Tuesday. Afterward, Sally is expected to move slowly north-northeastward near the northern Gulf Coast through Wednesday.

Maximum sustained winds have increased to near 65 mph (100 km/h) with higher gusts. Strengthening is expected over the next day or so, and Sally is forecast to become a hurricane by tonight, with additional strengthening possible before the center crosses the northern Gulf Coast.

At this time storm surges of up to 11 feet are warned for, but that could rise if hurricane Sally manages to intensify significantly on approach to the New Orleans area.

We’ll keep you updated as the situation develops and you can track the tropics over at our dedicated 2020 Atlantic hurricane season page.