Abstract: The dairy sector represents the cornerstone of Finnish agriculture but faces new challenges linked to the decoupling of farm subsidies and abolition of milk production quotas. Because of its increasing exposure to market forces, the sector must anticipate future changes in demand and deliver precisely what Finnish consumers want. This paper contributes to that goal by analyzing retroactively the drivers of demand for dairy products over the period 1975–2010 using National Accounts Data. After presenting the evolution of consumption for dairy products, we estimate a complete system of demand for food and dairy products and use it to decompose demand growth into a substitution effect, income effect, and trend effect. The analysis points to the severity of the challenges that the sector is facing. Stagnant consumption is at least partially the result of continuous but adverse taste changes, and as Finnish consumers grow more prosperous, they allocate an increasingly smaller share of their food budget to the dairy group. The low own-price elasticity of demand for dairy products also limits the benefits to the sector of growth in milk production. Hence, business-as-usual will result in the dwindling importance of the dairy sector in the Finnish food chain. Innovation and product differentiation, perhaps emphasizing the attributes of livestock production processes, are clearly required to counter this evolution.

Abstract: Efforts to limit global warming to below 2 degrees C in relation to the pre-industrial level are under way, in accordance with the 2015 Paris Agreement. However, most impact research on agriculture to date has focused on impacts of warming >2 degrees C on mean crop yields, and many previous studies did not focus sufficiently on extreme events and yield interannual variability. Here, with the latest climate scenarios from the Half a degree Additional warming, Prognosis and Projected Impacts (HAPPI) project, we evaluated the impacts of the 2015 Paris Agreement range of global warming (1.5 and 2.0 degrees C warming above the pre-industrial period) on global wheat production and local yield variability. A multi-crop and multi-climate model ensemble over a global network of sites developed by the Agricultural Model Intercomparison and Improvement Project (AgMIP) for Wheat was used to represent major rainfed and irrigated wheat cropping systems. Results show that projected global wheat production will change by -2.3% to 7.0% under the 1.5 degrees C scenario and -2.4% to 10.5% under the 2.0 degrees C scenario, compared to a baseline of 1980-2010, when considering changes in local temperature, rainfall, and global atmospheric CO2 concentration, but no changes in management or wheat cultivars. The projected impact on wheat production varies spatially; a larger increase is projected for temperate high rainfall regions than for moderate hot low rainfall and irrigated regions. Grain yields in warmer regions are more likely to be reduced than in cooler regions. Despite mostly positive impacts on global average grain yields, the frequency of extremely low yields (bottom 5 percentile of baseline distribution) and yield inter-annual variability will increase under both warming scenarios for some of the hot growing locations, including locations from the second largest global wheat producer-India, which supplies more than 14% of global wheat. The projected global impact of warming <2 degrees C on wheat production is therefore not evenly distributed and will affect regional food security across the globe as well as food prices and trade.

Abstract: Modelling is key to adapting agriculture to climate change (CC), facilitating evaluation of the impacts and efficacy of adaptation measures, and the design of optimal strategies. Although there are many challenges to modelling agricultural CC adaptation, it is unclear whether these are novel or, whether adaptation merely adds new motivations to old challenges. Here, qualitative analysis of modellers’ views revealed three categories of challenge: Content, Use, and Capacity. Triangulation of findings with reviews of agricultural modelling and Climate Change Risk Assessment was then used to highlight challenges specific to modelling adaptation. These were refined through literature review, focussing attention on how the progressive nature of CC affects the role and impact of modelling. Specific challenges identified were: Scope of adaptations modelled, Information on future adaptation, Collaboration to tackle novel challenges, Optimisation under progressive change with thresholds, and Responsibility given the sensitivity of future outcomes to initial choices under progressive change.