Investing Through Climate Volatility: What the 2026 El Niño Means for Natural Capital
Download the full white paper below.
Climate variability affects natural assets in different ways. The same weather pattern can improve water availability in one region while increasing drought, flood or biological risks elsewhere. For investors, understanding these differences is central to selecting resilient assets and constructing diversified portfolios.
In our latest white paper, Investing Through Climate Volatility: What the 2026 El Niño Means for Natural Capital, we explore how diversification, local expertise and active management can help investors assess and respond to these challenges.
Drawing on Astarte’s experience in forestry in Paraguay and regenerative agriculture in Chile, the paper examines three key investment principles:
Diversification across geographies and biological systems. Forests, permanent crops and aquaculture have different climate sensitivities and production cycles. Combining carefully selected exposures can reduce concentration in individual risks, although shared weather patterns and infrastructure dependencies remain important.
Local knowledge informs investment decisions. National climate forecasts can conceal significant differences between regions and individual properties. Understanding water availability, soils, crop and species suitability, infrastructure and operating conditions is essential to asset selection and underwriting.
Active management supports productive resilience. Resilient infrastructure, efficient water management, regenerative practices and continuous monitoring can help protect productive capacity. Their effectiveness, costs and remaining risks need to be assessed for each asset.
Paraguay and Chile illustrate these principles in practice. For forestry, water availability interacts with biological growth, fire exposure, access and harvesting logistics. For permanent crops, improved water supplies must be considered alongside the potential effects of poorly timed rainfall on flowering, fruit quality and operations.
These dynamics reinforce the importance of integrating climate resilience throughout the investment process, from initial selection and due diligence to ownership and portfolio construction.
As climate volatility places greater pressure on productive land, water and food systems, the quality and management of natural assets become increasingly important. The investment opportunity lies in identifying assets with the resources, infrastructure and operating capabilities to remain productive through changing conditions.
