Businesses around the world are increasingly preparing for the possibility of a strong El Niño weather pattern, as companies assess the potential impact on agriculture, food prices, shipping and supply chains.

A new analysis reported by Reuters found that corporate concern about El Niño has reached its highest level in several years.

El Niño is a climate pattern that can alter rainfall and temperatures across different parts of the world.

For businesses, the effects can extend far beyond weather conditions because changes in climate can disrupt agricultural production, transportation networks and the availability of important raw materials.

Food and beverage companies are particularly exposed because extreme weather can affect crops such as coffee, cocoa, grains and other agricultural commodities.

Poor harvests can increase raw-material costs and eventually push up prices for consumers.

Manufacturers and retailers are also monitoring the potential impact on supply chains.

Companies that depend on international shipping may face higher transportation costs or delays if extreme weather affects important trade routes and ports.

Business analysts say companies are increasingly incorporating climate-related risks into their planning because extreme weather can have direct financial consequences.

The renewed focus on El Niño demonstrates how environmental conditions are becoming an increasingly important factor in corporate decision-making and global commodity markets.

Source: Reuters, CNBC Africa