Author: ["Noah S. Diffenbaugh","Thomas W. Hertel","Martin Scherer","Monika Verma"]
CITE.CC academic search helps you expand the influence of your papers.
Abstract
Several factors can either increase or buffer the effects of climate change on the volatility of grain prices. A study shows that US corn price volatility is more sensitive to near-term climate change than to energy policy or agriculture–energy market integration. A biofuels mandate increases price sensitivity to climate change by more than 50%. Recent price spikes1,2 have raised concern that climate change could increase food insecurity by reducing grain yields in the coming decades3,4. However, commodity price volatility is also influenced by other factors5,6, which may either exacerbate or buffer the effects of climate change. Here we show that US corn price volatility exhibits higher sensitivity to near-term climate change than to energy policy influences or agriculture–energy market integration, and that the presence of a biofuels mandate enhances the sensitivity to climate change by more than 50%. The climate change impact is driven primarily by intensification of severe hot conditions in the primary corn-growing region of the United States, which causes US corn price volatility to increase sharply in response to global warming projected to occur over the next three decades. Closer integration of agriculture and energy markets moderates the effects of climate change, unless the biofuels mandate becomes binding, in which case corn price volatility is instead exacerbated. However, in spite of the substantial impact on US corn price volatility, we find relatively small impact on food prices. Our findings highlight the critical importance of interactions between energy policies, energy–agriculture linkages and climate change.Cite this article
Diffenbaugh, N., Hertel, T., Scherer, M. et al. Response of corn markets to climate volatility under alternative energy futures. Nature Clim Change 2, 514–518 (2012). https://doi.org/10.1038/nclimate1491 