Crop switching under climate change: Simulating adaptation in a northern Great Plains dryland farm

Adam McCurdy (1), Bill Travis (2)

Abstract
Assessing agricultural impacts of climate change requires some understanding of adaptive potential. We simulate crop-switching choices and financial outcomes for a northern Great Plains dryland farm experiencing climate change. We use crop budgets for North Dakota wheat farms and historic yield distributions as model inputs. The simulation approach allows us to vary not only climate, but key risk factors such as probability of total crop loss and the role of insurance. We adopt a “representative agricultural pathway” (RAP) in which warming climate in the spring wheat production region improves the performance of an alternative crop (winter wheat), to simulate crop switching behavior. The simulation looks at the less examined situation of climate change that appears to be creating opportunities for higher production. Two key risk factors in the model are altered over a 30-year simulation horizon: (1) the probability of winter kill of winter wheat, and (2) the availability, cost, and coverage of hypothetical winter wheat insurance (which is currently not available). Results in net crop income indicate that current winter conditions are very close to the point where the switch makes sense, while different crop insurance regimes and farmer risk aversion coefficients either quicken or delay switching behavior.