Global banana supply at risk as climate change hits producers

Climate change could pose challenges to banana sourcing for the US and EU, new research from Rabobank has found.

The Dutch bank’s research arm RaboResearch warned the banana supply chain faced significant risks due to yield fluctuations, increased water demand, severe weather events, and heightened disease pressure.

The US and EU rely on South America for imports, particularly Ecuador, Colombia and Costa Rica, which account for 73% of EU imports. Guatemala, Ecuador and Costa Rica make up 76% of US imports.

“With climate change taking effect, risks increasing, and market prices insufficiently compensating for increased costs and risks, it is unclear whether this concentrated sourcing strategy will remain viable for the EU and US markets,” said Camila Bonilla Cedrez, specialist F&A climate & sustainability for RaboResearch.

“Already, yields in countries like Colombia and Panama are affected, and disease risks are rising across the region.”

Climate change is altering tropical climate conditions like temperature and rainfall patterns, which is affecting yields differently across regions and could shift banana cultivation to new areas.

RaboResearch said that effective crop management could mitigate some impacts, but the challenge remained significant.

Yields have increased in many banana-producing countries in recent years due to an increase in temperature. However, by 2050, countries like India and Brazil are expected to see declining yield due to climate change. Key exporters like Colombia and Costa Rica may also be affected.

In contrast, African nations and countries like Belize and Ecuador may benefit from the shifting climate and could increase yields.

There are also concerns about the quality of bananas produced with high temperatures and excessive rainfall degrading fruit characteristics such as weight, firmness and colour.

The research group warned that without proactive measures, US and EU banana supply could face disruptions and contract breaches.

“Importers and retailers should reconsider sourcing strategies to ensure future supply,” said Bonilla Cedrez. “Diversifying sources to include African and other Latin American countries could reduce risks and encourage investment in alternative production systems.”

The warnings come following widely reported shortages of bananas within UK retail last week.