Standard Bank is strengthening agricultural resilience through climate-smart farming, regenerative agriculture and risk-management initiatives as Southern African producers prepare for the 2026-2027 El Niño cycle.
El Niño conditions have formed in the Pacific Ocean, with forecasts indicating the event could strengthen over the coming months and increase climate volatility across parts of Africa.
For agriculture, the potential effects include drought, heat stress, changing rainfall patterns and increased pressure on water resources.
However, Standard Bank’s latest climate risk assessments indicate that Southern African agriculture enters the new cycle better prepared than during previous major drought periods.
Kelly Tucker, Senior Manager for Environmental, Social and Governance Risk at Business and Commercial Banking, Standard Bank Group, said early preparation remains important.
“The 2026-2027 El Niño is expected to increase climate volatility across Africa, with heightened risks of drought, heat stress, food insecurity, water shortages, and infrastructure disruption, highlighting the need for early preparedness and resilience planning,” Tucker said.
The sector’s improved position follows years of investment in irrigation, water management, climate intelligence, improved seed genetics, precision farming and climate-smart agricultural practices.
Recent rainfall seasons have also contributed to improved dam levels, stronger soil moisture profiles and healthier grazing conditions, while consecutive productive seasons have strengthened carry-over grain stocks.
Louis van Ravesteyn, Head of Agribusiness at Business and Commercial Banking, Standard Bank Group, said these improvements provide producers with a stronger foundation from which to manage the coming season.
“El Niño conditions have arrived and the agricultural sector will need to plan accordingly,” Van Ravesteyn said.
“The event itself could be significant, but Southern African agriculture is materially better prepared.”
One area receiving increasing attention is regenerative agriculture, where farming practices can simultaneously improve soil health, strengthen climate resilience and create additional commercial opportunities for producers.
At NAMPO Harvest Day in May, Standard Bank announced a partnership with Orizon Agriculture to establish what it describes as South Africa’s first bank-backed regenerative agriculture carbon crop credit programme.
The programme enables qualifying farming clients to generate carbon credits from verified improvements in soil health and reductions in on-farm emissions, potentially providing an additional income stream alongside conventional agricultural production.
These practices can also improve farms’ ability to withstand drier conditions associated with El Niño.
Standard Bank says lessons from previous drought periods show the practical value of investing before severe weather arrives.
Producers that had invested in regenerative and climate-smart agriculture, irrigation infrastructure, dams and precision farming technologies generally performed better during the 2023-2024 El Niño cycle.
The bank also reported no material deterioration across its primary agriculture portfolio during that period.
Dryland farmers remain particularly exposed should rainfall decline significantly, while grain producers, livestock and feedlot operations, sugar producers, horticultural businesses and agricultural processors could experience varying levels of pressure.
The consequences could extend beyond farms into food supply chains, logistics, energy security, consumer affordability and the broader economy.
These challenges are among the issues being discussed at NAMPO Cape, where producers, agribusinesses, financiers, technology providers, equipment manufacturers and policymakers are examining water security, climate-smart agriculture, productivity and long-term sustainability.
“Agriculture has always operated in an environment of uncertainty, but today’s producers have access to better information, stronger technology and more sophisticated risk-management tools than ever before,” Van Ravesteyn said.
“While no one can control the weather, businesses can control how prepared they are.”
For Standard Bank, the approaching El Niño cycle therefore represents not only a climate risk but a test of the investments already being made to build a more resilient agricultural sector.
As weather conditions become more volatile, the ability to combine agricultural productivity with water efficiency, technology, regenerative practices and stronger risk management could prove increasingly important to protecting farms, food production and rural economies.
