The Impact of Climate Change on Global Food Supply and Demand, Food Prices, and Land Use

Abstract

Climate change induced crop yield change affects food production of countries to varying degrees, depending on the location of the farming activities. Differentiated yield changes of crops may lead to reallocation of agricultural land among uses. Key food exporters may reshuffle due to diverse climate change impact on crop farming among countries. We use a multi-region, multi-sector computable general equilibrium (CGE) model, which considers crop suitability of land in the optimal reallocation decision of land between uses, to simulate the impact on global food production, prices, and land use of crop yield change due to climate change as projected under the IPCC SRES scenario A2. Our findings show that developing countries are more adversely affected by climate change than developed countries. Developed countries are mostly located in higher latitudes, and climate change benefits the crop yield of these areas. In contrast, developing countries of the lower latitudes suffer from the reduction in crop yield being induced by climate change. Considering the fast growing population in the developing world, developed countries are expected to serve as the world’s key food exporters by 2020 should the climate change occurs as scenario A2 indicates.