Skip to main content

Economic impacts of climate-related changes to California agriculture

Abstract

California agriculture is driven by the interactions between technology, resources, and market demands. Future production is a balance between the rates of change in these variables and environmental factors including climate change. With tight statewide water supplies and agriculture being an important part of the California economy, quantifying the economic consequences of changes in these variables is important for addressing related policy questions. We estimate the economic effects of climate change on California crop farming by year 2050 using the Statewide Agricultural Production Model (SWAP). With climate warming, crop yields are expected to decline, production costs to increase, and water supplies to fall. These negative effects may be partially offset by higher crop prices and technological improvements. Results indicate that gross agricultural revenues across all regions are reduced under climate change, as is water usage. However, given the climate-induced reductions in water supply and crop yields, reductions in revenue are proportionally less due to shifting crop demands, technological change, and a shift to higher value less water intensive crops. Given the long time horizon required in this study, the results should not be considered a projection or forecast, but as a probable outcome of the interaction of several uncertain driving forces.

This is a preview of subscription content, access via your institution.

Fig. 1
Fig. 2
Fig. 3
Fig. 4

Notes

  1. htpp://cee.engr.ucdavis.edu/CALVIN

References

  • Adams RM (1989) Global climate change and agriculture—an economic-perspective. Am J Agr Econ 71:1272–1279

    Article  Google Scholar 

  • Adams RM, Rosenzweig C, Peart RM, Ritchie JT, McCarl BA, Glyer JD, Curry RB, Jones JW, Boote KJ, Allen LH (1990) Global climate and United States agriculture. Nature 345:219–224

    Article  Google Scholar 

  • Adams RM, Fleming RA, Chang C-C, McCarl B, Rosenzweig C (1995) A reassessment of the economic effects of global climate change on U.S. agriculture. Clim Chang 30:147–167

    Article  Google Scholar 

  • Adams RM, Wu J, Houston LL (2003) Climate Change and California, Appendix IX: The effects of climate change on yields and water use of major California crops, California Energy Commission. Public Interest Energy Research (PIER). Sacramento, CA

    Google Scholar 

  • Agricultural Issues Center (AIC) (2009) Measure of California Agriculture, University of California, Davis, Davis, CA, p. 151. Available in <http://aic.ucdavis.edu>. Access March 2011

  • Baldocchi D, Wong S (2008) Accumulated winter chill is decreasing in the fruit growing regions of California. Clim Chang 87:153–166

    Article  Google Scholar 

  • Bloom AJ (2006) Rising carbon dioxide concentrations and the future of crop production. J Sci Food Agric 86:1289–1291

    Article  Google Scholar 

  • Brunke H, Sumner D, Howitt RE (2004) Future food production and consumptionin California under alternative scenarios. Agricultural Issues Center, University of California, Davis

    Google Scholar 

  • Cayan DR, Maurer EP, Dettinger MD, Tyree M, Hayhoe K (2008) Climate change scenarios for the California region. Clim Chang 87:S21–S42

    Article  Google Scholar 

  • Costello CJ, Deschenes O, Kolstad D (2009) Economic impacts of climate change on California Agriculture, CEC, Public Interest Energy Research (PIER), Sacramento, CA. Available in <http://www.climatechange.ca.gov/>. Access December 2010

  • Draper AJ, Jenkins MW, Kirby KW, Lund JR, Howitt RE (2003) Economic-engineering optimization for California water management. J Water Resour Plan Manage 129:155–164

    Article  Google Scholar 

  • Easterling WE, Aggarwal PK, Batima P, Brander KM, Erda L, Howden SM, Kirilenko A, Morton J, Soussana JF, Schimidhuber J, Jacob TV (2007) Food, fibre and forest products. In: Parry ML, Canziani OF, Palutikof JP, van der Lind PJ, Hanson CE (eds) Climate Change 2007: Impacts, adaptation and vulnerability. Contribution of Working Group II to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge University Press, Cambridge, pp 273–313

    Google Scholar 

  • Green R, Howitt R, Russo C (2006) Estimation of supply and demand elastiticies of California Commodities, Working Paper. Department of Agricultural and Resource Economics. Universtity of California, Davis, Davis, California

  • Hayhoe K, Cayan D, Field CB, Frumhoff PC, Maurer EP, Miller NL, Moser SC, Schneider SH, Nicholas Cahill K, Cleland EE, Dale L, Drapek R, Hanemann RM, Kalkstein LS, Lenihan J, Lunch CK, Neilson RP, Sheridan SC, Verville JH (2004) Emissions pathways, climate change, and impacts on California. Proc Natl Acad Sci USA

  • Howitt RE (1995) Positive mathematical programming. Am J Agr Econ 77:329–342

    Article  Google Scholar 

  • Howitt RE, Ward KB, Msangi S (2001) Statewide Agricultural Production Model (SWAP), Department of Agricultural and Resource Economics. University of California Davis, California. Available in <http://cee.engr.ucdavis.edu/CALVIN>. Access January 2010

  • Howitt R, Kaplan J, Larson D, MacEwan D, Medellin-Azuara J, Horner G, Lee NS (2009a) Central Valley Salinity Report, Report for the State Water Resources Control Board. University of California, Davis, California. Available in <http://swap.ucdavis.edu/>. Access 01 November 2009

  • Howitt RE, Medellin-Azuara J, MacEwan D (2009b) Estimating economic impacts of agricultural yield related changes, California Energy Commission, Public Interest Energy Research (PIER), Sacramento, CA. Available in <http://www.energy.ca.gov>. Access 01 November 2009

  • Howitt RE, Medellin-Azuara J, MacEwan D, Lund JR (2010) Statewide agricultural production model, Davis, CA. Website. Available in <http://swap.ucdavis.edu>. Access October 2010

  • Jackson LE, Santos-Martin F, Hollander AD, Horwath WR, Howitt RE, Kramer JB, O’Geen AT, Orlove BS, Six JW, Sokolow SK, Sumner DA, Tomich TP, Wheeler SM (2009) Potential for adaptation to climate change in an agricultural landscape in the Central Valley of California, California Energy Commission, Public Interest Energy Research (PIER), Sacramento, CA, p. 142. Available in <http://www.climatechange.ca.gov/>. Access November 2009

  • Joyce BA, Methta VK, Purkey RP, Dale LL, Hanemann M (2009) Climate change impacts on water supply and agricultlural water management in California’s Western San Joaquin Valley and Potential Adaptation Strategies, Sacramento, CA. Available in <http://www.climatechange.ca.gov>. Access January 2011

  • Landis JD, Reilly M (2002) How we will grow: Baseline projections of California’s Urban Footprint Through the Year 2100. Project Completion Report., Department of City and Regional Planning, Institute of Urban and Regional Development, University of California, Berkeley, CA. Available in <http://www-iurd.ced.berkeley.edu/pub/WP-2003-04-screen.vpdf>. Access January 2009

  • Lee J, De Gryze S, Six (2009) Effect of climate change on field crop production in the Central Valley of California, California Energy Commission, Public Interest Energy Research (PIER), Sacramento, California, p. 26. Available in <http://www.climatechange.ca.gov>. Access 01 November 2009

  • Lobell DB, Field CB (2009) California Periennial crops in a changing climate, California Energy Commission, Public Interest Energy Research (PIER), Sacramento, CA, p. 37. Available in <http://www.climatechange.ca.gov>. Access 01 November 2009

  • Lobell DB, Field CB, Cahill KN, Bonfils C (2006) Impacts of future climate change on California perennial crop yields: model projections with climate and crop uncertainties. Agric For Meteorol 141:208–218

    Article  Google Scholar 

  • Lobell DB, Cahill KN, Field CB (2007) Historical effects of temperature and precipitation on California crop yields. Clim Chang 81:187–203

    Article  Google Scholar 

  • Lobell DB, Torney A, Field CB (2009) Climate extremes in California, California Energy Commission, Public Interest Energy Research (PIER), Sacramento, CA, p. 18. Available in <http://www.climatechange.ca.gov>. Access 01 November 2009

  • Lund J, Hanak E, Fleenor W, Howitt R, Mount J, Moyle P (2007) Envisioning futures for the Sacramento-San Joaquin Delta, Public Policy Institute of California, San Francisco, CA, p. 300 pp. Available in <http://www.ppic.org>. Access 01 November 2009

  • Medellin-Azuara J (2006) Economic-engineering analysis of water management for restoring the Colorado River Delta, Dissertation, University of California, Davis, Davis, California, p. 146

  • Medellín-Azuara J, Harou JJ, Howitt RE (2010) Estimating economic value of agricultural water under changing conditions and the effects of spatial aggregation. Sci Total Environ 408:5639–5648

    Article  Google Scholar 

  • Medellin-Azuara J, Connell CR, Madani K, Lund JR, Howitt RE (2009) Water Management Adaptation with Climate Change. California Energy Commission, Public Interest Energy Research (PIER): Sacramento, CA, p. 30

  • Muth RF (1964) The derived demand curve for a productive factor and the industry supply curve. Oxf Econ Pap 16:221–234

    Google Scholar 

  • Reilly J, Hohmann N, Sally K (1993) Climate change and agriculture: global and regional effects using an economic model of international trade, Economic Research Service, U.S. Department of Agriculture. Access March 2011. Available in < http://dspace.mit.edu> Access January 2011

  • Rosenzweig C, Phillips J, Goldberg R, Carroll J, Hodges T (1996) Potential impacts of climate change on citrus and potato production in the US. Agr Syst 52:455–479

    Article  Google Scholar 

  • Schlenker W, Roberts MJ (2009) Nonlinear temperature effects indicate severe damages to U.S. crop yields under climate change, Proceedings of the National Academy of Sciences roc. Natl. Acad. Sci. U.S.A. 106, 15594

  • Schlenker W, Hanemann WM, Fisher AC (2005) Will U.S. agriculture really benefit from global warming? Accounting for irrigation in the hedonic approach. Am Econ Rev 95:395–406

    Article  Google Scholar 

  • Schlenker W, Hanemann W, Fisher A (2007) Water availability, degree days, and the potential impact of climate change on irrigated agriculture in California. Clim Chang 81:19–38

    Article  Google Scholar 

  • Smith P, Martino D, Cai Z, Gwary D, Janzen H, Kumar P, McCarl B, Ogle S, O’Mara F, Rice C, Scholes B, Sirotenko O (eds) (2007) Agriculture. In Climate Change 2007: Mitigation. Contribution of Working Group III Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA

  • United States Bureau of Reclamation (USBR) (1997) Central Valley Project Improvement Act. Draft Programmatic Environmental Impact Statement. Technical Appendix Volume Eight. U.S. Department of Interior. U.S. Bureau of Reclamation: Sacramento, California

  • United States Department of Agriculture (USDA) (2007) Census of agriculture, NASS, Washington, D.C. Available in <http://www.agcensus.usda.gov>. Access March 2011

  • World Bank (2009) Double jeopardy: responding to high fuel and food prices, in G8 Hokkaido-Toyako Summit, July 2

Download references

Acknowledgements

The authors are indebted for the data and comments provided by Ray Hoagland, Farhad Farnam and Tom Hawkins from the California Department of Water Resources. The authors thank Kurt Richter for providing data and Chenguang Li for her research support. Funding from the California Energy Commission’s Public Interest Energy Research (PIER) is greatly appreciated.

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to Josué Medellín-Azuara.

Rights and permissions

Reprints and Permissions

About this article

Cite this article

Medellín-Azuara, J., Howitt, R.E., MacEwan, D.J. et al. Economic impacts of climate-related changes to California agriculture. Climatic Change 109, 387–405 (2011). https://doi.org/10.1007/s10584-011-0314-3

Download citation

  • Received:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s10584-011-0314-3

Keywords

  • Climate Change Scenario
  • Yield Change
  • Crop Price
  • Irrigate Pasture
  • Geophysical Fluid Dynamics Laboratory Model