The International Fund for Agricultural Development (IFAD) has warned that a severe El Niño event could cost the global economy up to $11 trillion over the next five to six years.
The climate phenomenon could also worsen food insecurity, threaten agricultural production and increase pressure on rural communities worldwide.
IFAD issued the warning in its new report, Food Systems Under Stress: Building Resilience from the First Mile, released at the COP31 climate conference in Antalya, Türkiye.
The report, developed with Türkiye’s Ministry of Agriculture and Forestry, examined how climate and economic shocks affect small-scale farmers and rural economies.
It highlighted rising energy and fertiliser costs in 2026, which have increased expenses across food production, processing, transportation and distribution.
Small-scale farmers face particular pressure because they produce approximately one-third of the world’s food.
Farmers Face Growing Climate and Economic Pressures
IFAD identified El Niño as one of several overlapping challenges threatening global food systems.
The organisation warned that climate disruptions combined with higher production costs could weaken farmers’ incomes and reduce their ability to maintain output.
The report called for coordinated investments in agricultural inputs, modern technology, market access and financial services.
These services include affordable credit and weather insurance, which can help farmers manage risks and recover from unexpected losses.
IFAD President Alvaro Lario said investments across these areas produced stronger results than isolated interventions.
He disclosed that farmers’ incomes increased by more than 40 per cent where the organisation supported all three areas together. Technology adoption also rose by 75 per cent.
Combined Support Could Reduce Farmers’ Losses
The report’s modelling showed that coordinated support could significantly reduce income losses during droughts and price shocks.
Financial interventions, such as insurance, reduced projected farm-income losses by 9.8 per cent.
However, combining financial support with agricultural inputs and market access reduced losses by 18.7 per cent.
The report also highlighted successful interventions in Kenya, Bangladesh and Türkiye.
In Kenya, farmers combined agricultural training with access to seeds, fertilisers, drought insurance and bulk grain buyers. The approach doubled their resilience to drought.
In Bangladesh, solar-powered irrigation, training, credit and food-safety certification helped reduce production costs. Household incomes increased by 50 per cent.
In Türkiye, grants, solar irrigation and improved storage and processing facilities contributed to a 40 per cent increase in farmers’ incomes.
El Niño Could Increase Health Risks in 2027
Beyond agriculture, the World Meteorological Organisation (WMO) has warned about possible health consequences from El Niño.
WMO Secretary-General Celeste Saulo said the phenomenon could intensify heat-related illnesses, disease outbreaks and air pollution into 2027.
Speaking at a COP31 briefing in Antalya, she explained that above-average temperatures could create health threats beyond direct exposure to extreme heat.
The WMO is working with the World Health Organisation to improve communication about weather-related health risks.
Saulo also cited preliminary estimates of more than 30,000 excess deaths linked to heatwaves, droughts and wildfires in Europe.
She highlighted preparations in South America, including plans to establish emergency shelters ahead of possible flooding.
IFAD stressed that governments and development partners must strengthen rural economies before climate-related emergencies occur.
It urged investment in water access, affordable agricultural inputs, finance, insurance and reliable markets to protect farmers and food supplies.
