Forum for Science, Industry and Business

Sponsored by:     3M 
Search our Site:

 

Climate change: Trade liberalization could buffer economic losses in agriculture

25.08.2016

Global warming could create substantial economic damage in agriculture, a new study conducted by a team of scientists of the Potsdam Institute for Climate Impact Research (PIK) finds. Around the globe, climate change threatens agricultural productivity, forcing up food prices. While financial gains and losses differ between consumers and producers across the regions, bottom line is that consumers in general will likely have to pay more for the same basket of food. As the additional expenditure for consumers outweighs producers’ gains, increasing net economic losses will occur in the agriculture and food sector towards the end of the century.

However, economic losses could be limited to 0.3 percent of global GDP – depending on agricultural trade policies.


Climate change affects agricultural productivity and could force up food prices.

Photo: Thinkstock

Quelle: Potsdam Institute for Climate Impact Research

“Agriculture is very sensitive to climate change – even a small increase of global mean temperatures can have significant effects on regional crop yields, affecting both the profitability of agricultural production and the share of income spent on food,” lead author Miodrag Stevanović says.

“Our study quantifies economic impacts and analyses the role of international trade as an adaptation measure. We find that economic losses in agriculture could add up to the annual amount of roughly 0.8 percent of global GDP at the end of the century with a very restricted trade regime. As small as this percentage sounds, it actually translates to losses of 2.5 trillion US Dollars and is comparably higher for regions with limited agricultural resources with respect to growing agricultural demand, for example the Middle East, Africa and India. In contrast, further trade liberalization in agricultural commodities could reduce financial damage globally by 65 percent, to 0.3 percent of global GDP.”

Trade can balance economic impacts on agriculture due to climate change

“Both global warming and free trade favor northern regions like Europe and the US, since producers' gains increase as trade patterns shift northwards. At the same time, southern regions like Africa or India could theoretically reduce climate-change-related damages by half through more liberalized food markets,” co-author Alexander Popp explains.

“Irrespective of our assumptions on global trade, climate change will result in reduced crop yields in many areas. At the same time, intensifying production or expanding cultivated land into previously untouched areas may come at a risk: it could lead to additional greenhouse-gas emissions through tropical deforestation or increased fertilizer use.” This could then further enhance climate change pressure on agriculture.

The researchers combined 19 different climate projections with simulations of crop growth to assess economic impacts of climate change in the agricultural sector. While the magnitude of damage varies with different assumptions on crop productivity response to climate change, CO2 plant fertilization effect or socio-economic projection, the study still highlights the important role of trade as a key measure to partly reduce climate change impacts. Modelling challenges such as adverse effects of extreme weather events still remain.

Risks of food shortages also call for poverty reduction measures

If food prices increase due to climate change impacts, households will not only have to spend more on their food consumption, but could also face risks of insufficient access to food and malnutrition.

“The best way to avoid these risks is to limit climate change. However, for impacts that cannot be avoided, an open and diversified trade system can be an important adaptation option. It can account for changes in global patterns of agricultural productivity and thus allow for reducing production costs and enhancing food security,” says Hermann Lotze-Campen, chair of PIK’s research domain Climate Impacts and Vulnerabilities.

“As climate change will have an amplifying effect on the gap between developed and developing countries, reductions in trade barriers will have to be accompanied by measures for poverty reduction and social safety nets.”

Article: Stevanović, M.; Popp, A.; Lotze-Campen, H.; Dietrich, J.P.; Müller, C.; Bonsch, M.; Schmitz, C.; Bodirsky, B.; Humpenöder, F.; Weindl, I.: The impact of high-end climate change on agricultural welfare. Science Advances. [DOI: 10.1126/sciadv.1501452]

Link to the article: http://advances.sciencemag.org/content/2/8/e1501452

For further information please contact:
PIK press office
Phone: +49 331 288 25 07
E-Mail: press@pik-potsdam.de
Twitter: @PIK_Climate

www.pik-potsdam.de

Jonas Viering | Potsdam-Institut für Klimafolgenforschung

More articles from Agricultural and Forestry Science:

nachricht New 3-D model predicts best planting practices for farmers
26.06.2017 | Carl R. Woese Institute for Genomic Biology, University of Illinois at Urbana-Champaign

nachricht Fighting a destructive crop disease with mathematics
21.06.2017 | University of Cambridge

All articles from Agricultural and Forestry Science >>>

The most recent press releases about innovation >>>

Die letzten 5 Focus-News des innovations-reports im Überblick:

Im Focus: Can we see monkeys from space? Emerging technologies to map biodiversity

An international team of scientists has proposed a new multi-disciplinary approach in which an array of new technologies will allow us to map biodiversity and the risks that wildlife is facing at the scale of whole landscapes. The findings are published in Nature Ecology and Evolution. This international research is led by the Kunming Institute of Zoology from China, University of East Anglia, University of Leicester and the Leibniz Institute for Zoo and Wildlife Research.

Using a combination of satellite and ground data, the team proposes that it is now possible to map biodiversity with an accuracy that has not been previously...

Im Focus: Climate satellite: Tracking methane with robust laser technology

Heatwaves in the Arctic, longer periods of vegetation in Europe, severe floods in West Africa – starting in 2021, scientists want to explore the emissions of the greenhouse gas methane with the German-French satellite MERLIN. This is made possible by a new robust laser system of the Fraunhofer Institute for Laser Technology ILT in Aachen, which achieves unprecedented measurement accuracy.

Methane is primarily the result of the decomposition of organic matter. The gas has a 25 times greater warming potential than carbon dioxide, but is not as...

Im Focus: How protons move through a fuel cell

Hydrogen is regarded as the energy source of the future: It is produced with solar power and can be used to generate heat and electricity in fuel cells. Empa researchers have now succeeded in decoding the movement of hydrogen ions in crystals – a key step towards more efficient energy conversion in the hydrogen industry of tomorrow.

As charge carriers, electrons and ions play the leading role in electrochemical energy storage devices and converters such as batteries and fuel cells. Proton...

Im Focus: A unique data centre for cosmological simulations

Scientists from the Excellence Cluster Universe at the Ludwig-Maximilians-Universität Munich have establised "Cosmowebportal", a unique data centre for cosmological simulations located at the Leibniz Supercomputing Centre (LRZ) of the Bavarian Academy of Sciences. The complete results of a series of large hydrodynamical cosmological simulations are available, with data volumes typically exceeding several hundred terabytes. Scientists worldwide can interactively explore these complex simulations via a web interface and directly access the results.

With current telescopes, scientists can observe our Universe’s galaxies and galaxy clusters and their distribution along an invisible cosmic web. From the...

Im Focus: Scientists develop molecular thermometer for contactless measurement using infrared light

Temperature measurements possible even on the smallest scale / Molecular ruby for use in material sciences, biology, and medicine

Chemists at Johannes Gutenberg University Mainz (JGU) in cooperation with researchers of the German Federal Institute for Materials Research and Testing (BAM)...

All Focus news of the innovation-report >>>

Anzeige

Anzeige

Event News

Plants are networkers

19.06.2017 | Event News

Digital Survival Training for Executives

13.06.2017 | Event News

Global Learning Council Summit 2017

13.06.2017 | Event News

 
Latest News

New 3-D model predicts best planting practices for farmers

26.06.2017 | Agricultural and Forestry Science

New research reveals impact of seismic surveys on zooplankton

26.06.2017 | Life Sciences

Correct connections are crucial

26.06.2017 | Health and Medicine

VideoLinks
B2B-VideoLinks
More VideoLinks >>>