Climate Change An Economic Risk

Caught between policy changes that raise production costs and climate impacts that erode productivity, farmers face a future with greater risk.

The National Climate Assessment notes some agricultural regions of the country could see higher short-term productivity because of a warming climate but face greater risks if more steps aren’t taken to curb the rise in greenhouse gas emissions. Yields for corn, soybeans, wheat, rice, sorghum and cotton are all projected to decline as the century continues because of higher temperatures, changes in water availability and disease and pest outbreaks, according to the report.

The National Climate Assessment, the fourth since 1990, was released in late November 2018. It is a congressionally mandated report drawn from the work of 13 federal departments and agencies, including the U.S. Department of Agriculture, which took a lead on the agriculture-specific content.

Katharine Hayhoe, a climate scientist at Texas Tech University and a primary author on the report, says this shows how climate is already changing, affecting different regions and sectors, and how the U.S. is responding to a changing climate. Hayhoe summarized the 1,600-page report saying, “Climate change isn’t a distant issue anymore. It’s affecting every single one of us in every part of the U.S. across almost every sector. And, the more climate changes, the more serious and even dangerous the impacts will become.”

The climate assessment has one major skeptic, President Donald Trump, who when asked about the economic impacts of climate change, said, “I don’t believe it.”

The assessment highlights long-term economic impacts on different sectors of society under higher emissions and lower emissions. Overall economic damages at higher pollution levels could average more than $500 billion annually.

Agriculture represents a small slice of annual economic losses in the report, yet many elements in the report show climate linkage to programs in the farm bill, including conservation, nutrition, research, renewable energy, rural development and trade. Other major challenges the report considers include labor losses, extreme temperature mortality and coastal property damage.

In the midterm (the next 25 years or so), not every region or crop is likely to be affected the same way. There are winners and losers, depending on growing seasons, higher carbon dioxide levels, fertilization and higher moisture levels. Over time, though, scenarios with higher pollution levels worsen the overall outlook for agriculture, says Bill Hohenstein, director of the USDA Climate Change Program.

“Longer term, the implications are decidedly more negative across a broader array of crops and regions,” Hohenstein notes.

Many of the impacts to agriculture go beyond production changes and are tied into the price of food globally, and changes in trade. Food security is already a global problem and “is likely to become an even greater challenge as climate change impacts agriculture,” the report states.

MIDWEST YIELD LOSSES

The Midwest is projected to see higher growing-season temperatures and more humidity in the spring through the mid-century mark. That region, which includes Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, Ohio and Wisconsin, is expected to see increased rainfall, leading to the likelihood of increased soil erosion.

Yield declines for corn mid-century could range from 5 to 25% over the region. Heat stress will start to plague the corn crop and continue to reduce yields as the decades continue. Soybean yields could fall 25% across the southern part of the Midwest but increase in the northern part of the region.

DTN senior ag meteorologist Bryce Anderson points to elements in the report highlighting areas of heavy precipitation and explains those events affected the 2018 growing season.

“Heavy, flooding rain back in the spring caused some major delays in corn and soybean planting over large portions of the western and northern Midwest,” Anderson says. “July had near- to above-normal precipitation over the majority of the Corn Belt, and August brought generally abundant amounts of moisture, as well, except, again, in the southwestern Corn Belt.”

Anderson adds the heavy-precipitation trend refused to let up. “September, October and November all featured occasions of heavy precipitation, mostly as rain, which in many areas caused either big harvest delays or losses in either crop quality or actual physical crop loss, or both. And, hurricane damage--notably from Florence and Michael--added to the harsh impact of extreme weather occurrences. Total crop production is large, but there were some big area losses.”

The full impacts of climate change on agriculture production in specific parts of the country are uncertain, but farmers can reduce negative impacts through different planting decisions, farming practices and technology, reports the National Climate Assessment. For example, biotechnology and gene editing could help offset droughts and combat pests and disease.

Specifically, the report says: “Modern breeding approaches and the use of novel genes from crop wild relatives are being employed to develop higher-yielding, stress-tolerant crops.”

RESILIENCY STRATEGY

To adapt, farmers can alter what they produce, modify inputs, adopt new technologies and adjust management strategies on farms.

“However, these strategies have limits under severe climate change and would require sufficient long- and short-term investments in changing practices,” the climate assessment states.

Hohenstein says the report reinforces USDA’s approach to managing climate risk by building resilience on farms. Drought-tolerance research, water management and improved irrigation systems, as well as a bigger focus at USDA on soil health, organic matter and water retention, are all areas emphasized by the assessment.

“In many ways, the findings of this report reinforce strategies in the department we are taking, and with our partners such as the Corn Growers [National Corn Growers Association] to get technologies and practices on the ground to help farmers manage these risks,” Hohenstein says.

The report also looks at the depletion of aquifers from irrigation, especially the Ogallala Aquifer, in the Plains. Some parts of the aquifer outside of Nebraska have seen water-level declines of more than 150 feet, and water extraction in most of the aquifer far exceeds its recharge capabilities.

Livestock producers are expected to face more economic losses because of heat stress on livestock. Heat stress can affect feed availability, as well as reproduction. Dairy cows are especially sensitive to heat stress, the report cites, because it affects both appetite and fermentation.

Wildfires also will likely intensify, reducing forage on rangelands--much like wildfires have become more frequent in the lower Plains in recent years, wiping out not just tens of thousands of acres of pasture but also livestock and infrastructure such as fencing.

The report highlights gaps in research for agriculture and says more private and public research is needed on genetic improvements for crop resiliency. This requires looking at a broader array of crops to improve genetics.

There was also a call for more emphasis on improving nutritional quality and economic implications, not just yield, as well as the impacts of pests and beneficial insects.

AG GROUPS CONCERNS

Over the years, the National Farmers Union has emphasized the risks of climate change with statements and policy resolutions. The group has never been shy about the topic, Roger Johnson, president of the organization, notes.

“The report makes it pretty clear there is big trouble ahead, and we need to start taking this seriously and put some things in place to deal with the existential threat that’s hanging over the world,” Johnson says.

One piece of the assessment that most troubles Johnson is that advances in technology for agriculture, including improved breeding techniques, are not expected to adapt fast enough to head off the impact of climate change by mid-century.

“Climate change is going to be able to overcome whatever technological changes we’re going to be able to provide,” Johnson says, referring to the report. “That’s a pretty stark assessment.”

While agriculture has the ability to mitigate greenhouse gases through carbon sequestration and perennial crops, as well as reduce methane emissions from livestock and manure, more understanding is needed on the processes.

The American Farm Bureau Federation (AFBF) has been supportive of initiatives that pay landowners or farmers to store carbon in the soil. But, the group’s grassroots members have preferred that climate solutions come from markets instead of government regulation, says Will Rodger, a spokesman for AFBF.

“I’m sure we would be open to paying (farmers) to store carbon,” Rodger says. “The problem our members have had with regulation is that it almost always goes awry, and it is typically very inefficient. If you start putting a price on carbon and looking for ways to encourage people to store it, basic economics tells you the folks who are best at it and do it the most efficiently are the ones that would come to the fore.”

The assessment report cites some of the positive work going on in commodities, including the public-private partnership within the National Corn Growers Association and its Soil Health Partnership for work on climate adaptation, including cover crops, conservation tillage and nutrient management to reduce soil erosion and nutrient losses while increasing organic matter.

Rodger adds the report is a metastudy and, in that sense, not much new, though, he notes, “The definitiveness of the statements being made are certainly stronger than we’ve seen in the past.”

How AFBF members will respond to the assessment and changing climate through the group’s policy book is unclear. Rodger adds, however, that farmers right now are struggling through a stretch of five years of lower income, farm sales, consolidation and a rise in bankruptcies.

“The idea of another cost being added to the pile just probably isn’t tenable for most of our farmers,” Rodger says.

FOR MORE INFORMATION

National Climate Assessment report

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