Research

Climate change could compromise European and US banana sourcing

17 March 2025 13:00 RaboResearch

Climate change will continue to impact banana cultivation. The EU and US markets rely on a limited number of competitive sources, and their supply could be at risk.

Intro

Climate change, including more frequent and severe weather events, could have a range of effects on banana production, including yield fluctuation, increased water demand, and heightened disease pressure.

In Latin America, yields in Colombia and Panama will likely be most affected. Other major banana-producing countries, such as Costa Rica and Guatemala, may need to invest in climate adaptation practices to mitigate the negative impact. Ecuador and the Dominican Republic seem to be in a better position. However, higher temperatures will require all supplying countries to pay special attention to disease pressure and fruit quality issues, as well as market distortion caused by climate change issues in other countries.

With the forecast impacts of climate change, banana supply in the US and the EU could be at risk unless timely action is taken. These regions rely heavily on banana supplies from just a few countries, which could eventually result in increased competition and higher risks. Reducing these risks is a joint responsibility of all stakeholders: not only farmers, but also importers and retailers in the EU and the US.

Potential strategies for importers and retailers include diversifying banana sources (e.g., into Africa and other Latin American countries) and supporting a shift to more robust production systems. That includes investing in developing new varieties, improving plant health, reducing monoculture (e.g., through intercropping or planting buffer strips), and improving water management. All of these strategies come at a cost, but so does doing nothing.

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