El Niño 2026-2027: Business Preparedness in the Americas and the Caribbean

El Niño is the leading source of year-to-year climate variability with global reach. In its warm phase, El Niño alters precipitation and temperature patterns across extensive tropical zones, with documented consequences for agricultural and livestock production, water availability, occupational health, ecosystem integrity, and the operational continuity of manufacturing and service industries.

This edition of the phenomenon presents an unprecedented scenario. In its May 2026 update, the World Meteorological Organization (WMO) reports an 80% probability that El Niño conditions will develop during the June-August quarter, with values rising to 90% or more for the July-November 2026 period. Long-range climate models point to a strong intensity, with the possibility of reaching the high-intensity category, defined by sea surface temperature anomalies equal to or greater than +2°C in the central-eastern ENSO region of the equatorial Pacific.

What sets this episode apart from previous events is that it develops against a baseline of +1.4°C of global warming relative to the pre-industrial period. In May 2026, the Head of Climate Prediction at WMO, Wilfran Moufouma Okia, noted that "the models indicate this could be a strong event; we must prepare." The IPCC Sixth Assessment Report (AR6, 2022) confirms that 1.5°C of global warming doubles the probability of extreme agricultural droughts across much of northern South America and Central America relative to the reference period, and that risks to agricultural yields could triple at 3°C.

The Americas and the Caribbean region holds institutional memory of what an episode of these characteristics entails. The 2023-2024 El Niño event, of strong intensity, left severe consequences. The Amazon drought affected 59% of Brazilian territory, the most severe since instrumental records began in the 1950s, with rainfall 30-40% below normal across the Amazon and the Pantanal. Economic losses associated with extreme events in Brazil during that period amount to approximately USD 15 billion according to inflation-adjusted estimates. The World Bank has documented that extreme climate disasters generate annual losses in the region that can reach between 2 and 5% of GDP in Southern Cone countries during severe episodes, and that a 1.5°C increase in mean global temperature would translate into an increase of up to 400% in the population affected by flooding in Peru.

At the regional macroeconomic level, the Inter-American Development Bank (IDB) has warned that a moderate-to-strong El Niño episode can generate an increase of up to 3 percentage points in the debt-to-GDP ratio over a three-year period in the most exposed countries.⁷ ECLAC, for its part, notes that climate change, including the variability associated with ENSO, is a factor that directly worsens the region's growth prospects, which already face a decade of low average growth (0.9% annually between 2015 and 2024), and that the agricultural and tourism sectors could lose up to 15 million jobs amid the intensification of climate impacts.

Justification

The business sector is, at once, one of the most exposed to El Niño's impact and one of the actors with the greatest capacity to act ahead of time. Companies face concrete risks that include:

• Severe restrictions on water supply for industrial, agro-industrial, energy generation, and service provision uses.
• Reduced agricultural and livestock productivity due to water deficit and sustained heatwaves.
• Increased risk of wildfires and/or flooding with direct impact on facilities, infrastructure, and logistics.
• A rise in workplace accidents and occupational illnesses stemming from heat stress.
• Higher energy costs amid declining hydroelectric flows.
• Disruptions to supply chains in sectors such as food, beverages, chemicals, manufacturing, and construction.

Yet companies in the region rarely have practical preparedness frameworks for extreme climate phenomena. The window that opens between the seasonal forecast and the event's peak is a strategic asset: acting now, while there is still time, can make the difference between operational continuity and significant losses in production, jobs, and assets.

Objectives

• Strengthen the anticipatory preparedness of the private sector in the Americas and the Caribbean for the El Niño 2026-2027 phenomenon, through the exchange of updated technical information, business experiences, and practical tools for preparedness against the risks associated with this event.
• Present the most recent scientific projections on El Niño 2026-2027 and their sectoral implications.
• Share the experiences of companies in the ARISE network that have advanced the implementation of concrete preparedness measures against the phenomenon.
• Make available to the regional private sector the preparedness tools and guidelines developed by Responsible Care.
• Identify priority actions in water management, worker protection, fire prevention, and production continuity, for both the period before the event's peak and the recovery phase.