Climate Adaptation & Water

According to a Robeco survey, the "Robeco Global Climate Investing Survey," which polled 300 investors worldwide (200 institutional investors and 100 wholesale distributors with total assets under management of approximately $35 trillion), indicates that the importance of climate change in investment policies is expected to recover from 46% in 2025 to 47% in 2026, and to increase further over the next two years. The survey has been conducted annually since 2021, and this is the sixth edition. The full survey report is scheduled to be published in October. Hiroaki Furusho, President and Representative Director of Robeco Japan, said, "Robeco initially emerged as an asset manager with strong quantitative capabilities, and in recent years we have leveraged those capabilities to focus on sustainable investing. Within our group of about 1,000 employees, we have over 50 specialists dedicated to sustainable investing, and we have gained high recognition in this field." The survey found that concerns over energy security due to the Middle East conflict and the increasing frequency of natural disasters have reignited interest in sustainable investing, with investors beginning to focus on the impact of physical climate risks on asset values. Additionally, Robeco's analysis shows that "leader companies" have achieved performance on par with equity indices, while "laggard companies" have clearly underperformed the indices.

The Office of the National Economic and Social Development Council (NESDB) has issued a report warning of the challenges from Data Center investment in Thailand, which is expanding rapidly amid the growth of AI technology and the digital economy. It points out that this industry consumes enormous amounts of electricity and water, especially water for cooling systems, which could impact households and agriculture if water balance planning is not coordinated with relevant agencies. Moreover, Thailand still relies on importing advanced technology such as chips and servers, so most economic benefits occur only during the construction phase. Meanwhile, legal and regulatory gaps remain, as some investors avoid applying for BOI promotion and instead obtain licenses from other agencies, preventing the state from comprehensively controlling environmental impacts. NESDB therefore proposes four solutions: establishing a main regulatory body, setting proportions for using Thai goods and labor, allowing public participation in oversight, and enforcing energy-saving technologies with clear water and electricity usage targets, so that Thailand does not merely bear the environmental costs.

Citi has raised its price forecasts for corn, soybeans and wheat, citing the strengthening Super El Niño as its highest-conviction agricultural market risk heading into late 2026 and early 2027. The bank lifted its three-month corn target to $5.40 per bushel and its 12-month forecast to $5.90 per bushel, while soybean targets rose to $12.75 for three months and $13.25 for 12 months, and wheat targets increased to $7.25 and $7.75 respectively. The revisions follow NOAA's August 2026 update assigning a more than 90% probability to a very strong El Niño event and a 69% chance that October through December conditions will surpass every El Niño episode recorded since 1950. Citi identified palm oil, robusta coffee, rice, sugar, cocoa and Australian wheat as among the commodities most exposed, with the greatest risks concentrated in Australia, India, Southeast Asia and parts of Brazil. The bank also noted that lower palm oil output in Indonesia and Malaysia could boost demand for soybean oil, adding further upward pressure to soybean prices.

Frontline Engineering, or FLE, sold all 100 million IPO shares after subscriptions opened on 21 and 24 to 25 August 2026 at 1.23 baht per share, reflecting investor confidence in its integrated water management business, especially opportunities from the expansion of digital infrastructure and data centres, a key megatrend. FLE shares are set to begin trading on the Market for Alternative Investment, or mai, on 1 September, with Fin Plus Advisory as financial advisor and Phillip Securities Thailand as lead underwriter. CEO Panu Chokapirat expressed confidence that listing will enhance business expansion potential and lay the foundation for sustainable long-term growth.

Deputy Prime Minister Pakorn Nilpraphun is preparing to propose that the mobile cabinet meeting in Songkhla approve a basic disaster insurance purchase programme for 20 million households, focusing on high-risk areas, to reduce the government's relief budget burden. The plan uses the Japanese model, under which insurers pay directly according to criteria set by the Office of Insurance Commission, covering floods, windstorms and earthquakes. It is expected to take effect as early as 1 October 2026, in line with the prime minister's policy.

Charoen Pokphand Produce Company Limited, or CPP, under the integrated crop, rice, transport, and services business of the Charoen Pokphand Group, has appointed Token X as its ICO Portal to jointly study Green Tokenization, connecting natural capital to the green financial system through blockchain technology. The study currently covers regulatory criteria, the structure for issuing and offering digital tokens, the suitability of underlying assets, benefit-sharing mechanisms, and the application of Real-World Asset Tokenization to maximize benefits for the agricultural and digital asset industries. CPP has many high-potential projects, such as a carbon credit project in rubber plantations for sustainable development covering 500,000 rai across five provinces, namely Loei, Udon Thani, Nong Khai, Bueng Kan, and Nakhon Phanom, involving more than 60,000 farming households. The concept is to convert assets from green projects into digital tokens, while also considering other ecosystem values such as forest restoration, habitat conservation, and biodiversity, where Biodiversity Credits may be another avenue to study and build upon to reflect the value of natural capital in a broader dimension.

The global watering equipment market is projected to grow from $12.8 billion in 2025 to $24.2 billion by 2035, a compound annual growth rate of 6.5%, according to a new report from ResearchAndMarkets.com. The sprinklers segment accounted for $4.52 billion in 2025, making it the largest product category, while the agriculture segment held a 44.9% share. North America generated $2.77 billion in 2025, representing a 21.5% share, and is expected to grow at a 5% CAGR through 2035. Major companies include Netafim (Orbia), Rain Bird Corporation, Hunter Industries, Husqvarna Group (Gardena), The Toro Company, Jain Irrigation Systems, and Hozelock (Exel Industries).

Institutional investors worldwide are starting to enforce the TNFD framework to assess nature and biodiversity risks, rather than looking only at greenhouse gas emissions through carbon tunnel vision. Multinational companies and retailers in Europe and America are beginning to set conditions for purchasing goods that do not harm ecosystems. If suppliers are found to be discharging wastewater or clearing forests, they may have credit lines suspended or face immediate rejection of their goods. One example is a Thai processed food exporter that nearly lost a Scandinavian customer because its fruit orchards used chemicals that damaged topsoil. But when IoT soil sensors and AI drones were used to spray biological agents instead of chemicals, the topsoil recovered within one season, and the customer agreed to pay above-market prices to place the products in the Nature Positive category, which is gaining popularity among Gen Z consumers in Europe.

The Robert Koch Institute, Germany's public health agency, said the estimated number of heat-related deaths in Germany from the start of the year through August 9 stood at around 14,000, a rate of nearly 17 per 100,000 people. The figure exceeds the full-year totals of every previous year, breaking the previous record set in 2018, when about 9,000 people died from heat, and it continues to trend upward. The elderly are at especially high risk, with people aged 75 and over accounting for nearly 10,500 of all heat-related deaths this year.

CIMB Thai Bank has identified three key megatrends that will draw green capital into Thailand: AI data centers, climate adaptation, and transition finance. The bank notes that climate adaptation projects have strong potential to raise funds through sustainable debt instruments such as Thailand Amber Bonds and transition bonds, which will help improve the bankability of the country's green projects.

CIMB Thai Bank says sustainable finance is moving from an era of classifying green assets to an era of capital allocation. Financial institutions will increasingly assess project feasibility, transition pathways, readiness in energy, water and infrastructure, and the ability of assets to generate income amid climate risk. The three key megatrends are transition finance, the expansion of AI and data centre infrastructure, and climate adaptation. In transition finance, the new bottleneck is likely to be corporate readiness, because debt instruments are only financial tools, not transition plans. Businesses therefore need to clearly define the assets to be transformed, greenhouse gas reduction targets, investment amounts, project sequencing and responsible parties. On AI and data centre infrastructure, CIMB Thai sees investment in Thailand shifting from quantity to quality. Investment promotion applications to the Board of Investment in the digital sector stood at 1.12 trillion baht, while data centre screening criteria now emphasise energy and water efficiency, environmental impact, benefits to the country, and the transition to clean energy. As a result, readiness in energy, water, power grids and climate risk management has become a key factor in project feasibility and bankability. At the same time, climate adaptation will play a larger role. World Bank data shows that of Thailand's climate investment needs of 219 billion US dollars, adaptation accounts for as much as 105 billion US dollars, exceeding the 96 billion US dollars for greenhouse gas reduction. In 2025, CIMB Thai has approved sustainable finance under its GSSIPS framework of about 22.98 billion baht, covering large corporate clients, investment banking, financial institutions and individuals. Its Sustainability360 Advisory Program has supported sustainability-linked fundraising connected to the market of more than 7 billion baht. The bank is also developing the Climate Transition Canvas, a tool to help plan climate transition by linking greenhouse gas reduction targets, carbon reduction measures, investment needs, funding sources, economic value and governance, so that they can lead to concrete financing. Jason Lee, Head of Sustainability, said that from 2026 to 2028, Thai businesses need to watch five trends: project readiness will be a key constraint on access to transition finance; energy competition will affect the location of AI infrastructure; water, power grids and climate resilience will carry more weight in data centre bankability; investment budgets to manage climate risk will increase; and sustainability functions in the financial sector will become more involved in capital allocation decisions. Driving Thailand's new economy requires linking carbon reduction, digital transition and climate adaptation with financial and investment plans to create long-term value for the Thai economy.

The Mayor of London's office has released a report saying climate change could cause up to £36 billion, or $50 billion, in damage to London per year by the 2050s, with lost working hours, business disruption, and damage to infrastructure from extreme weather likely to drag down London's gross domestic product. The report recommends that businesses adjust working hours, allow working from home, and relax dress codes, while calling on Transport for London to install air conditioning in new underground trains and find ways to keep trains and platforms cool. The Greater London Authority will prioritise protecting parks, publicising cool spaces, providing more public toilets and drinking water, and increasing shade in public areas. Mayor of London Sadiq Khan said climate change is threatening the lives of Londoners and causing hundreds of millions of pounds in economic damage, stressing the need to build cooler homes and buildings, greener and shadier communities, and infrastructure resilient to hotter weather. This summer, five heatwaves and weeks of low rainfall put pressure on the UK's public services, water systems, and infrastructure, while research in July found that the June heatwave caused £1.15 billion in damage to the English economy.

California American Water has submitted written testimony to the State Water Resources Control Board supporting a temporary suspension of the cease-and-desist order that has limited new water connections on the Monterey Peninsula since 2009. The company said successful expansion of Aquifer Storage and Recovery and continued regulatory progress on the desalination project mean the region is on a path toward better water security, allowing flexibility for the community while maintaining key protections for the Carmel River. California American Water president Sarah Leeper urged a cautious and strategic approach until Monterey has a permanent, drought-resilient water supply, warning that lifting the order without appropriate guardrails could increase demand and put decades of Carmel River restoration at risk during future droughts. The California Public Utilities Commission last summer confirmed Monterey could face an annual shortfall of 815 million gallons by 2050, and the company continues to focus on the three-part Monterey Peninsula Water Supply Project including Aquifer Storage and Recovery, water recycling, and desalination. The public will have an opportunity to provide comment to the Water Board on November 5, 2026.

A JPMorgan fertilizer analysis recirculating this week has been paired with a 12.3% figure that is not a forecast but the upper bound of a USDA 95% prediction interval for 2027 grocery prices. The USDA's actual midpoint forecast is 2.9%, with a lower bound of negative 5.6%, and the agency says discussions should focus on the midpoint. JPMorgan senior global economist Nora Szentivanyi said rising fertilizer prices could lift global food inflation temporarily to 4-5%, while the bank's April 7 research noted nitrogen benchmarks jumped 25% to 50% after the Strait of Hormuz closure. Retail urea has since fallen about 21% from its May peak to $678 a ton in early August, and the current grocery inflation story is concentrated in beef, with USDA forecasting a 10.7% rise in 2026, while egg prices are projected to fall 30.7% this year.

ROTEC Ltd. has been awarded the design for the use of Flow Reversal Reverse Osmosis at PUB Singapore's Changi NEWater Factory 3, an 86 million gallons per day plant. The company is in the final design phase for the project in collaboration with Jacobs Solutions, and the incorporation of FR-RO is designed to enable NEWater recovery of up to 90%, compared with the 75% recovery historically associated with conventional NEWater RO systems. This award follows ROTEC's work at the Tuas Water Reclamation Plant, where six FR-RO units have recently been delivered, each designed for more than 7 MGD of treatment capacity, representing 44 MGD of municipal water reuse now preparing for commissioning. The combined Singapore flow reversal capacity exceeds 130 MGD, and the Changi project will be ROTEC's largest Flow Reversal application to date.

JPMorgan recently issued a report warning that the next global food crisis may be brewing and could erupt next year. A-share agricultural stocks responded with broad gains on August 17, with Jinjian Rice hitting the daily limit up, and Qiule Seed, Shennong Seed, Kangnong Seed, Dunhuang Seed, and Shenzhen Cereals Holdings following higher. The report expects global food price inflation to rise from 2.8 percent in the first half of this year to 5 percent in the first half of next year. It also argues that Middle East conflict has disrupted passage through the Strait of Hormuz, and that a strong El Niño could reduce crop yields. The combination of these factors will hit agricultural production and keep food prices elevated through the first half of 2027. Nora Szentivanyi, the economist who led the research, said global crop prices have not yet peaked because transport of agricultural inputs such as fertiliser has been affected. This year's shock to global energy supply could double the impact of a super El Niño on food prices. The report also notes that agriculture in parts of Asia, Africa, and Latin America is more sensitive to weather changes, and food accounts for a higher share of household consumption there. Emerging market economies will be hit hardest by this shock. Last year, about 645 million people worldwide faced hunger, and about 2.1 billion people faced moderate or severe food insecurity, accounting for 25.8 percent of the global population.

Global Water Resources announced that its recently settled rate case for its largest water utility, GW-Santa Cruz, contemplates net increased revenues of approximately $1.9 million effective November 1, 2026. The company reported second quarter 2026 total revenue of $17.8 million, up 24.8% year over year, while net income was $2.7 million, or $0.10 per diluted share. Total active service connections increased 5.8% to 69,429 as of June 30, 2026. Management noted that higher depreciation and inflationary costs continue to pressure earnings, and it has started working on rate reviews for four additional utilities with filings anticipated in the first half of 2027.

Europe is facing its fifth heatwave of this summer, expected to peak on Thursday, August 13, amid extreme weather that is straining public health systems and energy networks across the region, while the United Kingdom is on track for its hottest summer on record. The scorching conditions are driven by successive high-pressure systems, or heat domes, blanketing the region, and are also disrupting freight transport on some major rivers. In financial markets, global stocks climbed near record highs after US inflation data came in cooler than expected, easing concerns that the Federal Reserve would raise interest rates in the near term. The yen strengthened after the Japanese government signaled support for the Bank of Japan to raise rates sooner, with the next hike possibly coming in September or October. West Texas Intermediate crude traded around 83 dollars a barrel, snapping a six-day winning streak. On the geopolitical front, the administration of President Donald Trump is stepping up economic pressure on Iran, including successive rounds of additional economic sanctions and maritime interdiction measures aimed at curbing Iranian oil exports. The UK government is planning legislation to regulate the use of AI in gene synthesis, amid concerns that the absence of global oversight could allow malicious actors to use the technology to create synthetic DNA that might lead to the development of biological weapons. In tech stocks, Lenovo surged as much as 22 percent in Hong Kong to a record high after reporting quarterly revenue up 43 percent, beating market expectations on AI-related demand. In contrast, Cerebras fell in after-hours trading after hardware revenue declined, while Cisco slipped as analysts viewed the company's AI sales outlook as highly cautious. Another focus is US-Japan cooperation on developing rare earth deposits beneath the seabed near Minamitorishima Island, more than 1,000 miles southeast of Tokyo, with estimates suggesting the resources could meet industrial demand for centuries and help both countries build a complete rare earth supply chain, reducing reliance on China for strategically important minerals.

Wheat futures rallied sharply on Wednesday after Ukrainian drone strikes halted operations at Russia's Novorossiysk port and Russia retaliated by striking a vessel in Ukraine's Odesa port. Chicago SRW contracts closed 13 3/4 to 22 1/2 cents higher, KC HRW futures gained 14 1/2 to 21 3/4 cents, and MPLS spring wheat rose 13 to 15 1/4 cents. NASS Crop Production data showed 1.531 billion bushels of wheat output for 2026, down 5 million bushels from July, while WASDE ending stocks for 2026/27 fell 5 million bushels to 717 million bushels. World ending stocks were raised by 0.41 million metric tons to 273.25 million metric tons, with increases for Canada and Ukraine offsetting a cut for the EU.

The global average sea surface temperature outside the polar regions in July 2026 surged to 20.96 degrees Celsius, breaking the record for July, according to data from the Copernicus Climate Change Service. The previous record was 20.89 degrees Celsius in 2023, partly driven by an emerging El Niño in the Pacific Ocean. Meanwhile, last month tied as the second-hottest July on record globally, with global temperatures about 1.47 degrees Celsius above the pre-industrial average. Western Europe experienced its hottest June and July on record, with an average temperature of 21.62 degrees Celsius, 2.79 degrees above the norm. The persistent hot and dry conditions also fueled severe wildfires in several areas. Samantha Burgess from the European Centre for Medium-Range Weather Forecasts said July 2026 marked the third consecutive month of exceptional heat in Western Europe, warning that extreme weather is becoming the new normal.

US commercial property insurer FM has acquired FortressFire, a wildfire intelligence company that uses machine learning and physics-based modelling. Financial terms were not disclosed. FortressFire will operate as an independent, wholly owned division of FM, continuing to serve insurers, reinsurers, brokers, real estate professionals, lenders, and property owners under its existing brand and leadership. FM chairman and CEO Malcolm Roberts said the deal reinforces the company's belief in data-driven, location-based risk mitigation, while FortressFire founder Michael Ashker called the acquisition a validation of its science-based approach to ignition prevention.

Jacobs has been selected by the Central Utah Water Conservancy District to provide engineering services for the proposed Strawberry High Line Improvement Project, a critical water infrastructure program with an estimated $750 million construction value. The project will transform the historic Strawberry High Line Canal into a modern, pressurized water system by replacing the open-water canal with a buried pipeline, serving both agricultural users and growing urban communities across south Utah County and eastern Juab County. In a joint venture with Bowen Collins & Associates, Jacobs is expected to provide design and construction-phase support services, including new pipelines and a pump station, to support water delivery to a future population of approximately 420,000 people. The corridor would also be repurposed with an integrated regional trail, providing a recreational amenity and improving community connectivity.

Climate exposure is increasingly altering the financial calculus of retail properties, moving beyond sustainability to become a core operating-cost and estate-planning issue. Insurance costs for U.S. commercial real estate surged 88% over five years, with MSCI data showing insurance reached 2.4% of income receivable in the 12 months to the third quarter of 2024, double the share five years earlier. However, the broader concern is that location-specific hazards like floods, wildfires, and severe convective storms—which Swiss Re Institute says accounted for 92% of global insured natural catastrophe losses in 2025—can disrupt trading, damage stock, and lengthen recovery times, making a store’s long-term economics depend on total risk rather than rent and footfall alone. Retailers are urged to assess risk store by store, invest in resilience where it matters most, and factor insurance, potential downtime, and adaptation costs into lease renewals and capital-allocation decisions.