Global Environmental Change and Small Island States and Territories:
Economic and Labour Market Implications of Climate Change on the Agriculture and
Viticulture Sector of the Maltese Islands
Tony Meli
The salient points arising out of the Malta Environment & Planning Authority (MEPA)
Environment report on Climate Change indicate five particular issues. The first of concern
was that Malta's greenhouse gas emissions increased by 49% between 1990 and 2007.
There were indications of particular vulnerability to sea-level rise and extreme events.
The need to sustain efforts towards decoupling of economic activity from greenhouse gas
emissions was recognized and adaptation measures would need to be adopted by various
sectors and social groups. A parallel action would be the mainstreaming across all policy
sectors to evaluate vulnerability and impacts with the aim of having a more resilient
adaptation. It was concluded that there was a requirement to resort to development
planning and related subsidiary policies and regulations as tools for mitigating and
adapting to climate change needs. MEPA 2010 (The Environment Report 2008, SubReport 3, Climate Change)
The latest Draft Report of the Intergovernmental Panel on Climate Change (IPCC, 2013), of
Working Group II in the IPCC Fifth Assessment Report Climate Change 2014: Impacts,
Adaptation, and Vulnerability confirms that human interference with the climate system is
occurring whilst extreme weather and climate events including droughts and floods have
significant impacts on economic sectors, natural resources, ecosystems, livelihoods, and
human health. From a point of view of other species, it is indicated that many terrestrial plant
and animal species have shifted their ranges and seasonal activities and altered their
abundance in response to past climate change, and they are doing so now in many regions. It
was confirmed that for rural areas, climate change will take place in the context of many
important economic, social, and land-use trends. (IPCC, 2013, Climate Change 2014:
Impacts, Adaptation and Vulnerability)
As socio-economic factors are important contributors to both the vulnerability and
adaptability of human and natural systems, assessing climate impacts both in human and
natural systems will necessitate a consideration of all factors influencing the systems.
Notwithstanding rural concerns or otherwise, agriculture is considered responsible for an
estimated one third of climate change. About 25% of carbon dioxide emissions, are produced
by agricultural sources, mainly deforestation, the use of fossil fuel-based fertilizers, and the
burning of biomass. Most of the methane in the atmosphere comes from domestic ruminants,
forest fires, wetland rice cultivation and waste products, while conventional tillage and
fertilizer use account for 70% of nitrous oxides. According to IPCC, the three main causes of
the increase in greenhouse gases observed over the past 250 years have been fossil fuels, land
use, and agriculture. (Climate Institute, http://www.climate.org/topics/agriculture.html)
On IPCC’s Draft Report, the Executive Director of the European Environment Agency
(EEA), other than pointing out that climate change was now visible in Europe and in all other
regions of the world, also stated that the risks for Europe include:
•
•
Increased risk of coastal flooding, erosion and economic losses due to accelerating
sea-level rise
Increased risk of inland flooding in many river basins due to projected increases in
heavy rainfall
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•
•
•
Increased economic, ecological and social impacts due to stronger and more frequent
heat waves, including health impacts, decreasing labour productivity, crop losses,
ecosystem decline and increasing risk of wildfires in southern Europe
Increased water restrictions due to significant reductions in water availability,
particularly in southern Europe.(EEA, 2014, IPCC report shows growing risks from
already-present climate change)
The Joint Research Centre (JRC) indicates that agriculture accounts for only a small
part of Europe’s gross domestic production (GDP), and the overall vulnerability of the
European economy to changes affecting agriculture is low. However, it also indicates
that agriculture is much more important in terms of land use, given that farmland and
forest land cover approximately 90 % of the EU's land surface, rural population and
income. Agriculture is a more significant in southern and southerly eastern European
countries in terms of employment and GDP, and these countries will face a decrease
in yields of 10% or more as a result of the shortening of the growing season and less
rainfall. A likely trend for producers to alter practices and crop types by region as the
climate changes was envisaged throughout Europe. (EEA, 2008 Impacts of Europe's
changing climate — 2008 indicator-based assessment) In a Maltese context this
would imply the need for additional organic matter to improve water retention
together with the selection of hardier varieties or breeds that exhibit more drought and
heat stress tolerance and earlier maturity such as the replacement of wheat by barley.
Another obligation would be earlier, if not continuous, pest monitoring for disease
control to compensate for mild winters with no cold break from pests or, if possible
the provision of disease resistant varieties.
In Malta’s Second UNFCC National Communication, the impact on cereals indicated that no
models had been carried out for Malta, but for southern Europe models showed that winter
wheat yields would not decrease where irrigation is not limiting, but there would be negative
impacts when water was limited. Shortening of growing periods was likely to increase
together with breakdown of organic matter, plant water stress and reduced crop yields.
Potatoes, would benefit from elevated Carbon Dioxide (CO2) and elevated temperatures,
however reduced yields were expected, particularly in arid conditions such as those in Malta.
In the longer term, when the absence of water would become the critical factor, the final
impact would result in the potato’s disappearance from Southern Europe.
Impacts on vines were likely to result from an increase in temperature and from the evolution
of rainfall distribution and efficiency. Impacts of increasing temperatures had already been
felt in Spain and France where growers are moving to higher elevations. This would result in
accelerated ripening that could inhibit production of good quality grapes. (MRA, UoM, 2010
The Second Communication of Malta to the United Nations Framework Convention on
Climate Change)
The University of Reading indicates a number of predicted effects of climate change on
agriculture over the next 50 years:
Carbon Dioxide, CO2
There is a very high probability that CO2 will increase from 360 ppm to 450-600ppm. In the
case of enhanced CO2 on crop growth, physiological differences in C3 and C4 plants play on
various uptake possibilities. Under CO2 enrichment, crops may use less water while
producing more carbohydrates, whilst requiring more nitrogen. When plants absorb more
carbon they grow bigger and more quickly. C3 plants take CO2 directly from the air during
2
carbohydrate production whereas C4 plants first concentrate CO2 first produce malate, which
then enters the photosynthesis cycle. Thus, C4 plants will respond less to increased CO2
levels. C3 plants include wheat, rice, and soybean, whilst maize, sorghum, sugar-cane, millet,
plus many pasture and forage grasses are C4 plants. Such effects would also need to be
considered in conjunction with other climatic effects, particularly higher temperatures and
soil moisture that could either enhance or negate potentially beneficial effects of increased
CO2.
Sea Level
There also a high possibility of a 10-15 cm – increased in the south and offset in the north by
natural subsistence/rebound. This will result in loss of land, coastal erosion flooding and
salinisation of groundwater. The issue of the increase in sea level will not only pose a threat
to agriculture in low-lying coastal areas, but also promote its elimination, particularly in
small islands. The intrusion of seawater into coastal lowlands and aquifers such as
Burmarrad, Pwales and Armier will create further hazards where drainage of surface water
and ground water are impeded. This will, in turn, oblige usage of more salt tolerant crops in
such areas.
Warmer Temperatures and Heat Stress
A rise of 1-2 Cº is expected with faster, shorter earlier growing seasons in a range moving
north with increased evapotranspiration and heat stress. Warmer temperatures will also
promote a quicker decomposition of organic matter, accelerate soil processes that determine
fertility and provide more ambient conditions for insect pests. This could necessitate
additional fertilizer/pesticide applications to sustain yields. In cases where soil moisture is
scarce, both root growth and decomposition of organic matter would be comparatively more
limited and would also increase vulnerability to wind erosion.
Temperature is a crucial input in vine cultivation. If the temperature exceeds 35°C for a long
period, red grapes would become stressed, with next to no tannins resulting. Malta had a local
advantage for producing red wine, unlike white which grows in a wider variety of places.
Currently, there are all the right conditions favouring red, except for water, though this, so
far, is controllable with a requirement of 800m3 of water sometimes even up to 1,000m3per
hectare of vines. Rain in spring is as yet not common, with prevalence in winter. Yet, an
increased occurrence of later rain and higher temperatures would tend to result in a greater
incidence of disease. Effectively wide fluctuations in yield are becoming noticeable - even
down by 75%, but also even up to a fourfold drop in quality. The maturity date is crucial, but
this is being affected by early and bad breaks of season occurring in mid-February rather than
spring. The prevalence of a cold spell after bud break has resulted in up to 50% losses in
Chardonnay production. (Roger Aquilina, oenologist, personal communication).
Global warming will extend the length of the potential growing seasons in the middle and
higher latitudes, obliging earlier crop planting, but this again will be a function of water
availability. In Malta, practically half the land area is committed to dryland fodder production
and there is but a small area of land under permanent crops with different fruits and
vegetables, with the choice of crops has been dominated by market prices in conjunction with
total water availability. An ageing farmer population, field size dominated by fragmentation,
shallow soils, lack of organic matter, and a high pH has so far limited the introduction of new
crops.
Precipitation
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Seasonal changes in precipitation of ±10% are expected. Changes in seasonal precipitation
will affect rainfall, evaporation, runoff and soil moisture storage. A decrease in rainfall can
result in moisture stress during germination, flowering, pollination and seeding that will harm
plants. In the case of increased evaporation, salinisation of the soil with decreased yields and
increased erosion will be the likely outcome with associated local drying of springs and
aquifers. Associated variations in wheat production in Malta the past two years have been in
the range of -10%, but even -50% was recorded. Similar yield losses were also observable in
olive production. Two years ago, there was a negligible yield which however could be
attributed to an off-year with up to 90% drop. Last year, however yield was around 33% and
mild winters with lack of supporting rainfall together with a mild summer that probably also
advantaged the presence of the olive moth were considered as contributory factors.
Climate Extremes
Climate variability and associated extreme meteorological events will see floods and
droughts causing extreme physical damage to crops, other than possible exceeding tolerance
of these crops to temperature extremes. Extreme rainfall will also result in increased soil
erosion in these situations. Locally, most erosion in agricultural areas will occur in natural
drainage depressions that have been cultivated, where rubble walls have not been maintained,
where land is very exposed and where areas have a steep topography.
Storminess and variability
Predictions for increases in these climatic variables are considered low together with
associated risk to damaging events that will affect crops and the timing of farm operations.
However altered wind patterns can see to the spread of wind-borne pests and diseases. The
combination of higher temperatures and increased wind could further result in susceptibility
to fires following drought and thus also accelerate desertification processes.
Main crop evaluation
Reference to the NSO’s last Census of Agriculture of 2010 indicates 9 major crop typologies
under Land Use for a total Utilisable Agricultural Area of 11,542.8 ha:
Crop Type
Forage/fodder crops
Vegetables
Kitchen Gardens
Potatoes
Vines
Fruit & berry
Olive
Citrus
Organic
(Source NSO, 2012)
Land Area (ha.)
5552.8
1730.5
1122.9
701.1
614.1
371.5
140.3
111.3
26.1
For all intents and purposes, forage constitutes a predominance of cereal crops, mostly wheat,
harvested as hay for livestock fodder. NSO’s Agriculture and Fisheries 2012 further indicates
tomatoes, lettuce, watermelon and cauliflowers as the crops with the highest tonnage sold
through official markets and these are taken as representative of vegetables and kitchen
gardens. Peaches constituted the most common of orchard trees, oranges are the most grown
citrus and strawberries the most produced fruit.
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Except for cereal production for fodder, all other crops are assisted with some form of
irrigation that ultimately mitigates adverse climatic conditions. Discussions with local
producers have indicated that cereals, olives and vines have so far demonstrated varying
degrees of susceptibility to climatic actors, although, management factors are also relevant.
Assumptions and standards
In calculating inputs and outputs for wheat, olives and vines, the ultimate aim was to
streamline data supported with good information. A crop budget will duly indicate the
methodology and profitability of cropping operations. Inputs have been sourced from
discussions with farmers and other technical persons closely involved either with the growing
of, or trade in, a particular crop and primarily concerned practices and general machinery
used. Similarly production has been based on average yields and average market prices. It is
assumed that wheat farmers will own a sprayer and resort to contract services. Other farmers
will additionally own a rotary cultivator, a van and other specialised items for their crop with
associated depreciation costs. Given the fragmentation and associated small size factor, not
all farmers are assumed to have tractors. Labour costs have been priced at the wage of a
person in the grade of farmer with the Department of Agriculture with an additional 10%
National Insurance contribution, at about €7/hour. Land rent is established at €175/ha for
irrigated land and €84/ha for dry land.
Economic Analysis
As indicated under precipitation, both for climatic prediction, as well as through feedback
from local farmers a minimum 10% fall in production is being assumed as the first financial
display of climate change. Wheat production leaves a return of €221.52/ha which is reduced
to €123.75 when a 10% decrease as a result of in climate change is assumed – effectively a
44.14% decrease in returns results. From a break even point of view there is a prevailing
situation where with a 22.7% decrease in production, no revenue would result. Olive
production leaves a return of €6777.28/ha which decreases to €3634.48 when a 10% fall for
climate change is applied – again a 46.37% decrease in returns where with a 21.5% decrease
in production, no revenue would result.
Wine certification falls into two categories: DOK and IGT. Denominazzjonin ta’ Origini
Kontrollata labels indicate that vintners followed the strict regulations possible to make that
wine; the Indikazzjoni Geografika Tipika quality also confirms authenticity but is less taxing.
Feedback attained on viticulture indicates a possible 50% loss pertaining to a false early
break as well as but a 25% return due to higher temperatures. Other than these limitations, in
the case of wine production two further economic scenarios prevail as to whether IGT or
DOC wine would be produced with correlated volumes per hectare at 18,000:12,500 for IGT:
DOC. Essentially IGT allows for more production. Additionally, there is a price range of
€0.65 to €0.80. Results indicate that IGT production operates with returns of €719.50 for the
€0.80/kg price but with a loss at €0.65/kg. With an assumed 10% climate change deduction
the €0.80/kg return would also operate at a €677.28 loss. All DOC production entails a loss.
IGT would break even with but a 5.9% fall for the €0.80/kg return.
5
Conventional Production of Wheat (Square Bales)/ha
Variable costs
925.6
Fixed costs
133.8
Total costs €
1,059.4
Climate
Change Factor
INCOME
1,008.00
-10.0%
Break
Even
907.20
-22.7%
779.18
3% Tax on Income
-30.24
-27.22
-23.38
VAT Refund
103.16
103.16
103.16
Subsidy on Less Fav. Area
Production cost
Revenue €
200.00
200.00
200.00
-1,059.40
-1,059.40
-1,059.40
221.52
123.75
-0.43
Conventional Production of Olives/ha
Variable costs
20,492.42
Fixed costs
4,748.56
Total costs €
25,240.98
Climate
Change Factor
INCOME
32,400.00
3% Tax on Income
-10.0%
Break
Even
29,160.00
-21.5%
25,304.40
-972.00
-874.80
-763.02
VAT Refund
390.26
390.26
390.26
Subsidy on Less Fav. Area
200.00
200.00
200.00
-25,240.98
-25,240.98
-25,240.98
6,777.28
3,634.48
20.26
Production cost
Revenue €
Conventional Production of Wine/ha
Variable costs
9976.80
Fixed costs
3,943.50
Total costs €
13920.30
IGT
.65to.80
INCOME - IGT
18000
0.8
INCOME - DOC
12500
0.8
3% Tax on Income
DOC
14400.00
Climate
Change Factor
-10%
Break
Even
12960.00
-5.9%
13,550.40
10000
-432.00
-300.00
-388.80
-406.51
VAT Refund
471.90
471.90
471.90
471.90
Subsidy on Less Fav. Area
200.00
200.00
200.00
200.00
-13,920.38
-13,920.38
-13,920.38
-13,920.38
719.52
-3,548.50
-677.28
-4.59
Production cost
Revenue €
INCOME - IGT
18000
0.65
INCOME - DOC
12500
0.65
3% Tax on Income
11700.00
-10%
10530.00
0.0%
11,700.00
8125.00
-351.00
-243.80
-315.90
-351.00
VAT Refund
471.90
471.90
471.90
471.90
Subsidy on Less Fav. Area
200.00
200.00
200.00
200.00
-13,920.38
-13,920.38
-13,920.38
-13,920.38
-1,899.48
-5,367.23
-3,034.38
-1,899.48
Production cost
Revenue €
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As yet, these conclusions have been based on field observations and not on scientific trials,
but essentially nowadays agriculture is the practical application of scientific principles.
Collective results indicate that some 6307.2 ha pertaining to the wheat, olive and vine crop
types or 54.64% of Malta’s total Utilisable Agricultural Area effectively could be rendered as
not economically sustainable should productivity fall from about 23%. This impact could
further exacerbate the push factor whereby the impact on farmer livelihoods would tend to
detract them away from farming. Thus the onset of drier and warmer conditions in the
Mediterranean region that could lead to more favourable pest conditions has become a
potential risk to the very existence of rural farming systems in Malta.
However the buck does not stop with the farmers. The provision of forage is closely linked to
the dairy industry. Instead of purchasing local round bales that cost €30 and which weigh
approximately 200 kg, the provision of imported hay at €250/tonne will be necessary –
effectively a €100/t additional expense which could translate as a setback to profitability for
livestock breeders, milk producers and finally consumers. In Malta, inextricably linked with
the dairy industry are other livestock industries, particularly swine in the provision of animal
feed. Given that logistics oblige the provision of specialised smaller ships to provide the basic
components for animal feed, any reduction in quantities would necessarily result in a higher
tonnage cost.
Total gross production at producer prices by type of product at current market prices
2009
2010
Final production at producer
130,981
129,094
prices
Livestock products
50,154
50,156
Beef
3,908
3,563
Pork
13,117
13,370
Sheep and Goats
425
395
Poultry
8,934
8,669
Rabbits
23,771
24,159
Animal products
25,337
24,089
Milk
18,299
17,982
Eggs
6,843
5,912
Other animal products
195
195
Crop products
47,647
47,857
Forage
3,831
3,769
Vegetables
29,889
30,146
Potatoes
4,708
4,962
Fruits
7,747
7,495
Flowers and seeds
1,256
1,269
Other seeds
216
216
Secondary activities
7,843
6,992
Wine
2,401
1,971
Cheese
5,442
5,021
Source NSO Economic Accounts for Agriculture: 2013
€ 000
±%
2013/2012
2011
2012
2013
132,427
133,946
138,222
3.2
49,906
3,371
13,186
384
8,586
24,378
24,874
20,303
4,376
195
50,899
4,677
28,149
8,971
7,100
1,786
216
6,749
1,892
4,856
48,812
3,556
11,486
381
8,660
24,729
28,955
21,921
6,824
210
48,708
4,314
29,243
5,822
7,270
1,844
216
7,470
2,663
4,807
51,313
3,512
14,030
363
8,608
24,800
30,176
22,073
7,893
210
49,605
4,633
28,840
6,770
7,417
1,730
216
7,128
2,538
4,590
5.1
-1.2
22.1
-4.8
-0.6
0.3
4.2
0.7
15.7
1.8
7.4
-1.4
16.3
2.0
-6.1
-4.6
-4.7
-4.5
In the case of production of fodder, grapes and olives, farmers could seek to cut down on
expenses by cutting down on inputs, particularly fertiliser, but this again would affect both
yield and quality particularly for wine and oil. The production of DOC wines has suffered a
setback since prices fell from the €0.93-€1.05 level to the current €0.65 - €0.80 range. Trying
to increase production by watering will affect the brix or sugar content, so ultimately farmers
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will have a tendency for vine grubbing or removal after the 10-year commitment for
government-aided development expires. It appears that olive production shall also necessitate
awareness of climate change issues to help farmers adapt through better managerial practices.
But, ultimately, oil and wine production command a niche in the local market that, if
unavailable, would again oblige imports.
Looking at the value of gross production for the sector as at 2013, and comparing the milk,
forage and wine components of €29,244,000 to the €138,222,000 total, these three areas
constitute at least 21.2% of the value of Malta’s agricultural production, and thus it may be
assumed that at least this component could be impacted because of climate change. Thus, the
response to damage to crops, with associated more difficult timing and management of
agricultural operations, could be addressed by co-ordinated collective efforts raising
awareness that promotes creative, practical and profitable responses, possibly including
renewable energy, nutrient inputs, and soil management to the farming community.
Agricultural adaptation options are grouped according to four main categories that are not
mutually exclusive: (1) technological developments, (2) government programs and insurance,
(3) farm production practices, and (4) farm financial management. (Smith & Skinner, 2001)
An ongoing process recommended at EU level that is also supported by the European
Agricultural Fund for Rural Development (EAFRD) is the promotion of resource efficiency
and supporting the shift towards a low carbon and climate resilient economy in the
agriculture, food and forestry sectors through better risk management as well as support for
climate change mitigation/adaptation through agri-environmental payments as well as
through support for areas facing natural or other constraints. The lack of a critical mass
precludes provision of local agricultural insurance. The selection of crop varieties more
resistant to heat shock and drought is neither an ongoing local activity, given that the
dimension of local agriculture generally imposes reliance on imported seed varieties,
however going back to the old traditional method of growing mahlut, a mixture of wheat and
barley, which at times when further mixed with vetches, sulla (legume) and wild oats,
provides a more resilient crop mixture particularly with the more hardy barley and oats, could
prove an agronomical sustainable approach. Similarly, crop rotation with the use of legumes,
again with the traditional use of sulla, provides a good alternative to crop nitrogen
requirements and would cut down on the manufacture of artificial nitrogen fertilizer which is
ultimately requires high energy for production, with contribution to greenhouse gasses. On
the other hand, resorting to more water saving approaches such as mulching, drip irrigation
and building of reservoirs is on the increase. The latter is also supported by the EAFRD.
Livestock breeders with manure digesters have just initiated to produce biogas to make
electricity other utilizing it as fertilizer. Improving the effectiveness of pest, disease, and
weed management practices through wider use of integrated pest management is becoming a
more common practice more because of better financial and environmental practices than for
climate change per se. Effectively, the size of holdings in Malta, where the number of
agricultural holdings across Malta and Gozo in 2010 amounted to 12,529, covering 11,453
hectares of utilised agricultural area, results with 73.5% having a utilised agricultural area of
less than 1.0 hectare each when some 18,539 persons were actively engaged in agricultural
activity. Indeed, this emphasises the need for a collective effort in such a small island
dimension to effectively monitor and tackle productivity, profitability and sustainability,
including mitigation of climate change.
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References
Aquilina Roger, oenologist, personal communications – January 2014.
EEA, 2008 Impacts of Europe's changing climate — 2008 indicator-based assessment
IPCC, 2014, Climate Change 2014: Impacts, Adaptation and Vulnerability
MEPA 2010 (The Environment Report 2008, Sub-Report 3, Climate Change)
MRA, UoM, 2010 The Second Communication of Malta to the United Nations Framework
Convention on Climate Change.
NSO, 2012 Census of Agriculture 2010
NSO, 2014 Economic Accounts Agriculture: 2013
Smith B., & Skinner M.W., 2001, Adaptation options in Agriculture to Climate Change: A
Typology
Climate Institute, http://www.climate.org/topics/agriculture.html Accessed 17/9/2014
University of Reading, Climate Change and Agriculture,
http://www.ecifm.rdg.ac.uk/climate_change.htm Accessed 17/9/2014
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