Abstract: The Mediterranean region has always shown a marked inter-annual variability in seasonal weather, creating uncertainty in decisional processes of cultivation and livestock breeding that should not be neglected when modeling farmers’ adaptive responses. This is especially relevant when assessing the impact of climate change (CC), which modifies the atmospheric variability and generates new uncertainty conditions, and the possibility of adaptation of agriculture. Our analysis examines this aspect reconstructing the effects of inter-annual climate variability in a diversified farming district that well represents a wide range of rainfed and irrigated agricultural systems in the Mediterranean area. We used a Regional Atmospheric Modelling System and a weather generator to generate 150 stochastic years of the present and near future climate. Then, we implemented calibrated crop and livestock models to estimate the corresponding productive responses in the form of probability distribution functions (PDFs) under the two climatic conditions. We assumed these PDFs able to represent the expectations of farmers in a discrete stochastic programming (DSP) model that reproduced their economic behaviour under uncertainty conditions. The comparison of the results in the two scenarios provided an assessment of the impact of CC, also taking into account the possibility of adjustment allowed by present technologies and price regimes. The DSP model is built in blocks that represent the farm typologies operating in the study area, each one with its own resource endowment, decisional constraints and economic response. Under this latter aspect, major differences emerged among farm typologies and sub-zones of the study area. A crucial element of differentiation was water availability, since only irrigated C3 crops took full advantage from the fertilization effect of increasing atmospheric CO2 concentration. Rainfed crop production was depressed by the expected reduction of spring rainfall associated to the higher temperatures. So, a dualism emerges between the smaller impact on crop production in the irrigated plain sub-zone, equipped with collective water networks and abundant irrigation resources, and the major negative impact in the hilly area, where these facilities and resources are absent. However intensive dairy farming was also negatively affected in terms of milk production and quality, and cattle mortality because of the increasing summer temperatures. This provides explicit guidance for addressing strategic adaptation policies and for framing farmers’ perception of CC, in order to help them to develop an awareness of the phenomena that are already in progress, which is a prerequisite for effective adaptation responses.

Abstract: EU climate policy and AFOLU•Overall 2030 level of ambition agreed by European Council October 2014•Commission ESR proposal July 2016 – sharing of effort in NETS across MS plus trading mechanisms•Commission LULUCF proposal – integration of LULUCF into climate policy•AFOLU mitigation pursued through CAP as well as flanking environmental policies•No specific EU targets for agricultural mitigation in NETS•Ultimately, how AFOLU mitigation is pursued will depend on MS decisions2Implications of EU bubble•Commission has put in place trading mechanisms in NETS sectors to ensure least-cost fulfilment of overall EU targets•Challenge of MS ESR targets also depends on use MS make of trading mechanisms•MS have not to date made use of these mechanisms and prefer to meet targets domestically•A number of MS have domestic targets in addition to EU targets•ESR IA looked at adding central information site, central market place for AEA transfers or mandatory auctioning•Links with annual monitoring and 5-year legal compliance checks (2027 and 2032)

Abstract: DP models with risk aversion through meanvariancespecification is already implemented inLuke and applied in North Savo regionHOWEVER climate change, e.g. changes in mean andvariance of crop yiels, still not yet taken into account– Recently, such crop modelling results have becomeavailble for wheat as well, not only for barley– Still CC impact available for 2 cereals crops only, whilemost farms cultivate more than 2 crops Some early conclusions• The suggested approach is consistent in terms of DPprinciples and mean-variance approach and can provideconsistent results for farm scale risk analysis• It is however hard to utilise the approach except assuming afarm with only few crops (those with crop modelling / otherresults of climate change effects on mean and (co-variance)© Natural Resources Institute Finland• Assuming no change in price (co)variability is a majorsimplification results show farm level (or local) effects ofchanges in mean yields and yield (co)variability only