Abstract: Climate variability (CV) normally influences production and farm management, and climate change (CC) has precisely the effect of changing this variability. Thus, models that estimate the economic impact of CC, integrating with climatic models, agronomic, and livestock, must represent the implications of this variability on farm management. This study describes an economic model based on Discrete Stochastic Programming (DSP) which assesses the impact of CC on milk production in the Grana Padano area. The model is based on 23 farm typologies from FADN that represent 856 farms in Piacenza and Cremona, two of the most important provinces for Grana Padano production. The results of the model were projected at the regional scale. The climate scenarios, current and future, are generated with a Regional Atmospheric Modeling System. The forage production under these scenarios is estimated with the EPIC agronomic model. Estimates on milk production and livestock mortality are based on studies conducted in the Po valley. The nutritional needs of the cattle are estimated with the CNCPS model. Probability distribution functions (PDF) express the relations between the CV and the productive variables under both climate scenarios. These PDFs represent the expectations of farmers on the productive-climate variability in the DSP model, which is PMP calibrated based on land distribution observed in a reference year. Comparing the model results in the two scenarios indicates the effects of CC, given the opportunity to adapt the use of resources and techniques of cultivation. The structure of the model, and its economic results are presented and discussed, along with the strengths and weaknesses of this approach. No Label

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.