Specify er panels) (producer panels) historical and future climate periods by soil (EPIC)

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(EPIC)

Potential economic benefits of adapting agricultural production to future climate change in Montana’s Flathead Valley

T. Prato, University of Missouri; Z. Qiu, New Jersey Institute of Technology; G.T. Pederson, University of Arizona; D.B. Fagre and L. Bengston, USGS; and J.R. Williams, Blackland Research and Extension Center

Background

• Climate change modifies crop growing conditions, which can alter crop yields, the profitability of crop enterprises, and net farm income.

• Crop yields have been projected to increase in production areas that experience slightly higher surface air temperatures and higher growing season precipitation, and decrease in production areas that experience significantly higher surface air temperatures and lower growing season precipitation or inadequate irrigation water supplies.

• Crop farmers may be able to take advantage of the benefits or reduce the risks of future climate change by adapting agricultural production systems to actual or expected climate change.

• Previous studies of the potential agricultural impacts of future climate change: (1) focus on different spatial scales than the farm scale; (2) have not examined impacts of climate change on net farm income; (3) have not evaluated the potential benefits of adapting agricultural production systems to future climate change; and/or (4) have not involved local farmers in the impact assessment of climate change.

Study Area

Objectives

• Compare crop enterprise net returns and net farm income for agricultural production systems in an historical period (1960-2005) and a future climate period (2006-2050) under three climate scenarios for small and large representative farms and two soil types.

• Determine whether adapting agricultural production systems to future climate change improves net farm income for farmers in the

Flathead Valley.

Representative Farms

A representative farm uses a mix of crop enterprises, farming operations, crop acreages, and total acreage similar to those of actual farms in a local production area.

Flathead Valley

IPCC Climate Scenarios

Specify crop enterprises, soils, and agricultural production systems for representative farms with aid of producer panels

Methods

Simulate crop yields in historical and future climate periods for two soil types, and three climate scenarios

(EPIC model)

Simulate crop enterprise net returns and NFI for agricultural production systems

(Simetar program)

Estimate/specify probability distributions for crop yields, crop prices, and crop enterprise costs

(crop enterprise budgets &

Simetar program)

Determine dominant agricultural production systems

(SERF program)

EPIC stands for Environmental/Policy Integrated Climate. Simetar stands for

Simulation and Econometrics to Analyze Risk. SERF stands for stochastic efficiency with respect to a function.

Agricultural Production Systems

Crop enterprise spring wheat winter wheat oats spring canola spring barley dry alfalfa irrigated alfalfa spring lentils dry peas spring wheat oats spring canola spring barley irrigated alfalfa spring lentils permanent pasture

Large representative farm (ha)

APS 1 APS 2 APS 3

− 81 162

81

40

40

61

61

61

61

40

40

Small representative farm (ha)

APS 4 APS 5 APS 6

− 12 8

− 8 −

12

10

28

16

8

22

16

8

22

12

16

Results

• Averaged over all crop enterprises, farm sizes, and soil types, simulated net return per ha decreased 24% and simulated mean NFI for

APSs decreased 57% between the historical and future climate periods.

• Adapting APSs to future climate change is advantageous because net farm income with adaptation is superior to NFI without adaptation.

• In six of the nine cases in which adaptation is advantageous, net farm income with adaptation in the future climate period is inferior to net farm income in the historical climate period.

• Adaptation of APSs to future climate change in Flathead Valley is insufficient to offset the potential adverse impacts of such change on

NFI.

More Details

Prato, T., Z. Qiu, G. Pederson, D. Fagre, L. Bengtson, and J. Williams.

2010. Potential economic benefits of adapting agricultural production systems to future climate change.

Environmental Management

. 45:

577.

Acknowledgement

The research reported here was supported in part by the National

Research Initiative of the USDA Cooperative State Research,

Education and Extension Service, grant number 2006-55101-17129.

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