Climate change remains one of the most important challenges and threats for humanity. It has substantial economic costs. Greenhouse gas (GHG) emissions are externalities and represent the biggest market failure the world has seen [Stern, 2008]. Negative impacts of climate change vary across different sectors. Agriculture remains one of the most affected ones, which will be significantly changed due to higher emissions and temperature. At the same time, agricultural development also contributes to GHG emissions. Therefore, this commentary aims to analyze bi-directional relationship between climate change and agriculture.
According to estimates, global warming of 2°C, as in the most optimistic forecast, could reduce agricultural output by up to 25%. Results of many country-based studies demonstrate that climate change may lead to considerable losses in the agricultural sector. Evidence from Peru shows that high temperatures reduce agricultural productivity as farmers respond to a drop in yields by increasing the area planted during the agricultural year. It is important to note that household members, including children, work more on the farm when faced with high temperatures. These changes in input use partially offset the drop in agricultural income. Additionally, farmers in hot years change their output mix. This strategy may lead to land degradation and negatively affect human capital accumulation as children spend less time on education [Aragon et al., 2019]. Other examples of negative consequences of climate change on agriculture include cases of African countries. For instance, in 2007, a severe drought in Lesotho, one of the least developed countries in southern Africa, drastically reduced crop yields and increased food prices. As a result, 20% of the country’s population required emergency food assistance. According to estimates, climate change contributed to a decline in self-sufficient households in Lesotho by 50% and caused a decrease in the average household purchasing power by 37%. It should be noted that high import dependence, rain-fed agriculture, and extreme climate variability are the main features of many African countries [Otto et al., 2021]. Projections for agricultural sectors of advanced economies are also not promising. According to estimates based on different climate models, future climate change will reduce annual corn productivity in the United States by roughly 15% in 2050. Valued at production quantities and prices averaged over 2006–2010, 15% yield losses would generate annual losses of $6.7 billion by 2050. The study predicts substantial losses under future climate change in the absence of unprecedented adaptation [Burke and Emerick, 2016]. Many studies forecast that changes in temperature and precipitation will lead to detectable increases in food prices by 2050. Under high uncertainty, by 2050 food prices can increase by up to 84% [Carraro, 2016]. Moreover, climate change affects human health and there is growing recognition of the explicit consequences for mental health and wellbeing. Rural communities are recognized as one of the most vulnerable populations. Therefore, well-informed rural populations are concerned about the environmental, financial, health, and social impacts of climate change [Austin et al., 2020].
Thus, direct consequences of climate change on the agricultural sector include increasing temperatures, weather variability, shifting agroecosystem boundaries, invasive crops and pests, and more frequent extreme weather events. It reduces crop yields, the nutritional quality of major cereals, and livestock productivity [World Bank, 2021]. Climate change contributes to an increase in food prices, which is of great concern for low-income and food import-dependent countries.
At the same time, agricultural activities, in particular crop and livestock production for food, remain important contributors to climate change. Various management practices on agricultural soils, including the application of synthetic and organic fertilizers, the growth of nitrogen-fixing crops, the drainage of organic soils, and irrigation increase the availability of nitrogen in the soil and result in emissions of nitrous oxide (N2O). Livestock, in particular cattle, produce methane (CH4) as part of their normal digestive processes. Moreover, livestock manure management practices also contribute to CH4 and N2O emissions. In 2019, the share of the agricultural sector in total GHG emissions in the United States amounted to 10% and they have increased by 12% since 1990. It should be noted that N2O emissions from soil management increased by 9%, while CH4 and N2O emissions from livestock manure management systems surged and amounted to 60% [Environmental Protection Agency (EPA), 2021a].
Various sources show different contributions of agriculture to global GHG emissions. According to the United States EPA (2021b) data, the share of the agricultural sector in the global GHG emissions was equal to 24% in 2010. This share was a direct effect from the cultivation of crops and livestock and deforestation. The OECD (2016) mentions that agriculture contributes a significant share of the GHG emissions that are causing climate change – 17% directly through agricultural activities and an additional 7-14% through changes in land use. The World Bank (2021) indicates that agriculture currently generates 19–29% of total GHG emissions. It notes that without action, that percentage could rise substantially as other sectors reduce their emissions. Therefore, the share of agriculture in global GHG emissions equals around 30%.
To mitigate the negative consequences of climate change, the Food and Agriculture Organization (FAO) of the United Nations proposes to implement the climate-smart agriculture approach. The approach has three main objectives. Firstly, it aims to increase agricultural productivity and income. Secondly, it intends to adapt and build resilience to climate change. Finally, it aims to reduce and/or remove GHG emissions [FAO, 2021]. However, cross-country differences in adaptation strategies are significant. Advanced countries lead in this process. Scholars from different developed countries conduct various studies on changing the menu for cattle. Recently, researchers from the United States found that green, red, or amber seaweed might turn to be the perfect new ingredient on the menu for cattle. In particular, the Asparagopsis taxiformis, red algae growing in the tropics, can inhibit the development of methane in the stomach of cows up to 80%. Researchers from the University of Copenhagen conducted the same study in 2019 experimenting with a variety of algae present in the North Sea. They found a consistent methane reduction of about 20%. At the same time, startups from the United Kingdom proposed burp-catching masks for cattle to help neutralize livestock methane. Many advanced countries also consider new food management systems to reduce food waste [De Lorenzo, 2021]. The situation in developing and low-income countries is different. Traditional agriculture remains a key source of revenue. Farmers do not consider adaptation strategies not only due to financial and technological constraints but also due to poor awareness about bi-directional climate-agriculture relationships. Therefore, the global response to the problem will be uneven. Policymakers in developing countries should consider this issue.
Representatives of agricultural businesses should also be concerned about the future of the sector under climate change. However, agricultural corporations react differently to this global common problem. In the United States, large companies actively lobby against climate policies. In particular, beef and dairy companies appear to act collectively in ways similar to the fossil fuel industry, which built an extensive climate change countermovement. In general, they act through lobbying, political campaigns, and academic research. In particular, they fund their own academic experts, who then publish research that minimizes or denies the causal link between animal agriculture and climate change. It should be noted that six of the big US groups have together spent about $200 million in lobbying since 2000 [Samuel, 2021].
Thus, climate change and the agricultural sector have bi-directional impacts. To mitigate mutual negative consequences, there is a high need for multilateral cooperation, as individual countries cannot solve these problems. Governments around the world should start their intervention policies. At the same time, advanced countries and international development institutions should assist developing and low-income countries in their adaptation strategies. Developing countries in turn need to work on raising the awareness of the problem, which will allow the responsible private sector to change their management practices. Large corporations together with governments should invest in new climate-friendly agricultural technologies and change food management systems. These policies can contribute to the sustainable development of the agricultural sector under climate change.
References:
Aragon, Fernando, Oteiza, Francisco and Juan Pablo Rud (2019). How do farmers cope with extreme heat? Retrieved from https://voxdev.org/topic/agriculture/how-do-farmers-cope-extreme-heat. Accessed on 20.04.2021.
Austin, Emma K., Rich, Jane L., Kiem, Anthony S., Handley, Tonelle, Perkins, David and Brian J. Kelly (2020). Concerns about climate change among rural residents in Australia. Journal of Rural Studies, 75: 98–109.
Burke, Marshall and Kyle Emerick (2016). Adaptation to Climate Change: Evidence from US Agriculture. American Economic Journal: Economic Policy, 8(3): 106–140.
Carraro, Carlo (2016). Climate change: scenarios, impacts, policy, and development opportunities. Agricultural Economics, 47: 149–157.
De Lorenzo, Daniela (2021). A Seaweed Diet Could Reduce Cattle’s CO2 Emissions. Retrieved from https://www.forbes.com/sites/danieladelorenzo/2021/04/20/a-seaweed-diet-could-reduce-cattles-co2-emissions/?sh=bf936a84b9f0. Accessed on 20.04.2021.
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EPA (2021b). Global Greenhouse Gas Emissions Data. Retrieved from https://www.epa.gov/ghgemissions/global-greenhouse-gas-emissions-data#Sector. Accessed on 18.04.2021.
FAO (2021). Climate-Smart Agriculture. Retrieved from http://www.fao.org/climate-smart-agriculture/en/. Accessed on 17.04.2021.
OECD (2016). Agriculture and Climate Change: Towards Sustainable, Productive and Climate-Friendly Agricultural Systems. Retrieved from https://www.oecd.org/agriculture/ministerial/background/notes/4_background_note.pdf. Accessed on 18.04.2021.
Otto, Friederike, Verschuur, Jasper and Piotr Wolski (2021). How climate change drove food insecurity in the 2007 Lesotho drought. Retrieved from https://www.weforum.org/agenda/2021/03/lesotho-and-south-africa-the-effects-of-drought-on-climate-change/. Accessed on 18.04.2021.
Samuel, Sigal (2021). It’s not just Big Oil. Big Meat also spends millions to crush good climate policy. Retrieved from https://www.vox.com/future-perfect/22379909/big-meat-companies-spend-millions-lobbying-climate. Accessed on 18.04.2021.
Stern, Nicholas (2008). The Economics of Climate Change. American Economic Review: Papers & Proceedings, 98: 2-37.
World Bank (2021). Climate-smart agriculture. Retrieved from https://www.worldbank.org/en/topic/climate-smart-agriculture. Accessed on 17.04.2021.
Note: The views expressed in this blog are the author’s own and do not necessarily reflect the Institute’s editorial policy.