Trade can buffer climate-induced risks and volatilities in crop supply

Haqiqi, Iman

doi:10.1088/2976-601x/ad7d12

Title: Trade can buffer climate-induced risks and volatilities in crop supply

Journal Article · 03 October 2024 · Environmental Research: Food Systems

DOI: https://doi.org/10.1088/2976-601x/ad7d12 · OSTI ID:2447594

^[1]

Purdue University, West Lafayette, IN (United States); Pennsylvania State University

Climate change is intensifying the frequency and severity of extreme events, posing challenges to food security. Corn, a staple crop for billions, is particularly vulnerable to heat stress, a primary driver of yield variability. While many studies have examined climate impact on average corn yields, little attention has been given to the climate impact on production volatility. This study investigates the future volatility and risks associated with global corn supply under climate change, evaluating the potential benefits of two key adaptation strategies: irrigation and market integration. A statistical model is employed to estimate corn yield response to heat stress and utilize NEX-GDDP-CMIP6 climate data to project future production volatility and risks of substantial yield losses. Three metrics are introduced to quantify these risks: Sigma (σ), the standard deviation of year-on-year yield change, which reflects overall yield volatility; Rho (ρ), the risk of substantial loss, defined as the probability of yield falling below a critical threshold; and Beta (β), a relative risk coefficient that captures the volatility of a region's corn production compared to the globally integrated market. The analysis reveals a concerning trend of increasing year-on-year yield volatility (σ) across most regions and climate models. This volatility increase is significant for key corn-producing regions like Brazil and the United States. While irrigated corn production exhibits a smaller rise in volatility, suggesting irrigation as a potential buffer against climate change impacts, it is not a sustainable option as it can cause groundwater depletion. On the other hand, global market integration reduces overall volatility and market risks significantly with less sustainability concerns. Furthermore, these findings highlight the importance of a multidimensional approach to adaptation in the food sector. While irrigation can benefit individual farmers, promoting global market integration offers a broader solution for fostering resilience and sustainability across the entire food system.

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Research Organization:: Purdue University, West Lafayette, IN (United States)

Sponsoring Organization:: USDOE Office of Science (SC), Biological and Environmental Research (BER); USDOE Office of Science (SC), Biological and Environmental Research (BER). Earth And Environmental Systems Science (EESS)

Grant/Contract Number:: SC0022141

OSTI ID:: 2447594

Journal Information:: Environmental Research: Food Systems, Journal Name: Environmental Research: Food Systems Journal Issue: 2 Vol. 1; ISSN 2976-601X

Publisher:: IOP PublishingCopyright Statement

Country of Publication:: United States

Language:: English

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29 ENERGY PLANNING, POLICY, AND ECONOMY
54 ENVIRONMENTAL SCIENCES
Crop production
adaptation
climate change
climate risk
international trade
irrigation

Title: Trade can buffer climate-induced risks and volatilities in crop supply

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