This contract is a weekly market on whether a single US state will have Exceptional Drought (D4) on its land area, as measured by the US Drought Monitor. Under the rules, a state resolves "Yes" if D4 covers 0.05% or more of its land area in the US Drought Monitor release for the week of November 10, 2026, and "No" otherwise. The rules state that D4 area below 0.05% is treated as cartographic noise at state borders and resolves "No" [1]. The threshold is small, so a state only needs a very limited footprint of the most severe drought category to meet it. The measurement period and publication schedule matter for timing. Each US Drought Monitor release covers the seven-day period ending Tuesday at 8:00 AM ET and is published the following Thursday [1]. Resolution is based on the first published release for the listed week. The first published release is final, and that publication serves as the revisions cutoff, so later revisions are not considered [1]. The rules also allow a limited window of up to seven calendar days for a correction if the source publishes a clearly erroneous value because of technical or operational error, or because of unauthorized interference [1]. If the Drought Monitor has not been published by 11:59 PM ET on the day after the scheduled publication date, the market resolves to "No" [1]. The roster of states changes through the year. The rules list 33 of the 48 coterminous states as in season for November, including Alabama, Arizona, California, Colorado, Florida, Texas and Washington [1]. A state that does not appear in this event is not making any claim about its drought conditions. It simply has no market for this week [1]. The market sample shown here is partial. The provider event contains 33 markets, and 12 are included in this sample [1]. The included markets are ordered by Yes price, then by volume, so the sample does not show prices for the remaining 21 states. In the included markets, each state's Yes and No outcomes are both shown at 0.5. These figures are a snapshot of provider data at one point in time. They are not executable quotes, and the sample does not reveal anything about the states left out of it. Trading volume also does not indicate liquidity or the number of participants.

Historical Context

Drought conditions in the Southeastern United States offer one example of how severe dryness can persist over several years. From 2006 to 2008, the region experienced a drought that Wikipedia attributes to an unusually strong Bermuda High pressure system and the timing of La Niña, which causes dry conditions across the Southern United States [2]. The same source says that 2007 was particularly dry, with rivers and lakes dropping to record-low levels and many of them drying up completely [2]. This background describes a past event and does not describe current conditions in any state.

Frequently Asked Questions