Climate Changes starts to bite in the nut industries
The influence of climate and weather on human societies is already apparent to the world ’s rural populations: inclement weather can result in failed harvests, higher food prices, unrest, and unrest leading to revolutions. Syria being a good example
The increasing effect of climate change should be a warning to all agricultural investors and this is doubly true for climate-sensitive tree-crops, most notably almonds which are considered the cannery in the coal mine.
Almond trees: fragile flowers
Almonds are the fragile-flower of the tree-crop world, only truly thriving in a limited number of Mediterranean-type ‘Goldilocks’ climatic zones where the environmental conditions are just right.
The tree is an early bloomer, with the Northern-Hemisphere almond bloom commencing just prior to spring, with Valentine’s Day being the traditional marker for the beginning of the bloom. In the Southern-Hemisphere, the bloom usually commences in August.
Most varieties of almond-trees are pollinated by honey-bees, and so it follows that those regions of the world that are too cold for honey-bees are unsuitable for almonds as well. On the other hand, excessively warm climes are also unsuited, as almond trees require a certain minimum number of ‘chilling hours’ during their winter-time dormancy phase.
Extreme weather during bloom-time can damage flowers and disrupt bee-flight, and inclement weather in the weeks after the bloom period can be equally problematic, with excessive precipitation resulting in over-watering, as well as increasing the likelihood of the ‘jacket rot’ fungal infection. Both circumstances are deleterious to the nascent crop.
As almond-trees awaken from their dormancy phase relatively early, frost is another significant risk during the bloom period. Unseasonably warm weather in late winter can prompt early-flowering in almond trees, and every day that the bloom commencers earlier than average increases the likelihood of a frost event.
There are some indications that within recent decades, the frequency of both excessively wet years and bloom-time frost events have been increasing in the worlds almond growing regions, a pattern which is most likely driven by climate change. This pattern of extreme weather has been particularly pronounced in some regions. ie Australia and California.
This may lead to a trend to growing more hardier varieties of nuts like Walnuts which unlike almonds have survived many of the extreme weather events seen in recent years with little consequence. Walnuts bloom around two months later than almonds, and so the late frosts that have troubled almond growers over the past couple of years were not an issue for them.
The weather worries of Olam
Sunny Verghese, the CEO multinational agribusiness giant Olam, singled out climate change as a major challenge facing the company in a interview:
…Based on our footprint, in terms of where we are growing these many crops across the World, in almost every area we are seeing the impact of climate change… in the mid 70s…early 80s, (the) average number of extreme weather events were between seventy and eighty, and last year we had more than one thousand extreme weather events. The acceleration of the number of weather events, the prolonged duration of these episodes, and the severity of these episodes, all lead us to believe that there is climate change impacts…
As noted by Verghese, climate change pressures are not isolated to one country, nor the almond industry. But almonds, a particularly sensitive crop, maybe the agricultural equivalent to the canary in the coal-mine, and over recent years all almond growing regions in the globe seem to have felt the climate-change pinch to some degree.
Other options for almond and other sensitive nut crop growers might be is to use gene editing technology to modify its flowering period.
No matter what the future holds climate wise those growers who adapt with modified crops will benefit from higher prices as weather cycles become more extreme. The alternative is to move production.
We are already seeing traditional growers from California and Australia moving to Chile where climatic conditions for nut production is more favorable.
Contact the Gateway to South America team to learn about the best investment opportunities in the region. The company is a benchmark for foreign investors wishing to invest in Argentina, Brazil, Chile, Paraguay, Peru and Uruguay, providing expert advice on property acquisition.