Abstract: The European Union (EU) has recently reformed its Common Agricultural Policy (CAP) and, in parallel, has completely abolished the production quotas for milk. These changes will have important consequences for the use of land, of inputs (i.e., water and chemicals) and on the economic performance of rural areas. It is of interest to evaluate the integrated impact of these modifications and of climate change (CC), since the latter could neutralize or reverse some desired effects of the former. For this purpose, this paper evaluates the potential impact of the abolition of milk quotas, as well as of the reform of the first pillar of CAP in two different climate scenarios (present and near future). A bio-economic model simulates the possible adaptation of various farm types in an agricultural area of Southern Italy to these changes, given the available technological options and current market conditions. The main results show that the considered policy changes have small positive impacts on economic and environmental factors of the study area. However, some farm types are more affected. CC can effectively attenuate or reverse several of those effects, especially in some farm types. These results can inform the planning of future changes to the CAP, which will have to act in the context of deeper climate alteration.

Abstract: WP3 develops the tools for assessing the productive and economic impact of climate change and the potential of mitigation and adaptation strategies. This is achieved by focussing, along with CropM and LiveM, on significant crossing issues in specific geographical areas, natural and human resources, and farming systems. Following, the steps for identifying the hot-spots and the basic elements of climate change are shortly described. Next, the main economic and structural characteristics of each hot-spot are described followed by a presentation of the most relevant aspects of climate change, and of their main impacts on farm sector. No Label