As climate change intensifies, Türkiye grapples with a new threat: rising food prices driven by increasingly erratic weather patterns, according to an analysis by the country's central bank.
In a blog post on Tuesday, the Central Bank of the Republic of Türkiye (CBRT) highlighted the significant risks that climate change poses to price stability, particularly in the nation's crucial agricultural sector.
The study underscores the connection between extreme weather events – such as prolonged droughts, severe storms and floods – and escalating food prices.
Türkiye's annual inflation has plagued households over the recent years but began dipping this June and touched 61.78% last month in what is expected to be a gradual, lasting decline.
The climatic disruptions are particularly concerning for Türkiye, one of the key global producers of fruits and vegetables, as the country lies in the vulnerable Mediterranean region, which is acutely sensitive to climate fluctuations.
"Extreme climate conditions causing short-term supply shocks constitute a risk to the general price level through the vulnerable food sector," the bank warned, emphasizing that "climate change occupies the research agenda of central banks, whose primary objective is maintaining price stability."
Meteorological data reveals a troubling shift: Since 2020, Türkiye has experienced milder autumns and winters alongside hotter springs and summers, coupled with a consistent decline in rainfall. This shift has not only reduced agricultural yields but has also driven up production costs, particularly in regions like Mersin, Adana, Antalya, Hatay and Muğla, where severe droughts have significantly impacted fruit and vegetable production.
The bank said rising temperatures, together with decreasing precipitation, put upward pressure on food prices through both declining agricultural yields and increasing production costs.
As summers grow hotter and drier, the demand for irrigation increases, leading to higher electricity consumption among farmers. The result is a double-edged sword: shrinking food supplies and rising production costs, both of which are reflected in the soaring prices of fresh produce.
The CBRT's analysis highlights a notable shift in the seasonal price structure of fresh fruits and vegetables.
Before 2020, summer months typically saw a decrease in food prices, offering some relief to consumers. However, post-2020, the trend has reversed, with summer now contributing to inflation rather than alleviating it.
The analysis suggests that while factors such as the coronavirus pandemic, supply chain disruptions and geopolitical tensions have influenced this shift, climate change is emerging as a significant driver of these changes.
"Shifts in seasons due to climate change affect supply and costs," the bank said, adding that "climate change has not only become a major threat to sustainability and food security but also to price stability."
The implications of these findings are far-reaching.
For Türkiye, a developing nation with a substantial agricultural sector, the intersection of climate change and food prices poses a critical challenge. "The relationship between climate change and food prices is particularly critical for developing countries such as Türkiye, concerning both household welfare and the overall inflation outlook," said the analysis.
As temperatures rise and droughts become more frequent, the pressure on food prices is likely to persist, complicating efforts to maintain price stability.
"As a result of increasing temperatures and occurrences of droughts due to climate change, fruit and vegetable production has fallen, putting upward pressure on production costs and thus on prices," the bank said.
"These developments emphasize the importance and necessity of addressing food prices and climate change together."