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  An Introduction to Climate Change Legislation

Table of Contents | Foreword | Preface | Executive Summary | Overview | Contributors | Participants and Staff

Climate Change and U.S. Agriculture

Juha Siikamäki and Joseph Maher

Summary

Despite its relatively small role in generating carbon dioxide (CO2), agriculture is frequently discussed in the context of climate change - for several reasons. First, agriculture is one of the key sectors of the economy that may be strongly affected by climate change. Second, while relatively unimportant for CO2 emissions, the agriculture sector is a major source of other greenhouse gas (GHG) emissions, notably nitrous oxide (N2O) and methane (CH4). Third, agricultural practices provide opportunities for soil-based carbon sequestration, potentially a relatively cheap mitigation option. Fourth, the recent biofuels boom is transforming U.S. agriculture in ways that have implications not only for GHG emissions and energy production, but also for agriculture and the food sector as a whole. This issue brief brings together each of these aspects of the connection between agriculture and climate change.1

IB 13
Climate Change and U.S. Agriculture


Effects of Climate Change on Agriculture


  • Climate change is not expected to materially alter the overall ability of the United States to feed its population and remain a strong agricultural exporter. Generally, climate change is predicted to have overall positive but relatively modest consequences on agricultural production in the United States over the next 30 to 100 years. Longer term consequences are less well understood.

  • At the regional level, however, projected effects on agriculture are considerable. Climate change is expected to reduce agricultural output in the South but increase production in northern regions, especially the Great Lakes.

  • Predicting changes in precipitation patterns, extreme weather effects, pest populations, plant diseases, and other production risks is inherently difficult. Current assessments do not fully account for potential effects on agriculture from these climate impacts.

Agriculture as a Source of GHG Emissions


  • The agricultural sector is responsible for roughly 8 percent of total U.S. GHG emissions.

  • Agriculture is not a major source of CO2 emissions, but it is the source of almost 30 percent of methane emissions and 80 percent of nitrous oxide emissions. On a CO2-equivalent basis, these gases account for nearly 15 percent of all GHG emissions in the United States. Most agricultural nitrous oxide emissions stem from soil management; methane emissions come primarily from animal husbandry (specifically, enteric fermentation in the digestive systems of ruminant animals and manure management).

  • While unlikely to be included in a mandatory policy, the agricultural sector is a potential source of low-cost emissions offsets. Though these offsets provide important GHG mitigation opportunities, incorporating them in a regulatory system presents challenges in terms of measuring, verifying, and assuring the permanence of claimed reductions.

  • Cost-effective GHG mitigation opportunities in the agriculture sector include the use of soil management practices to reduce nitrous oxide emissions and increase carbon sequestration.

  • Soil-based carbon sequestration, in particular, may represent an important near-term GHG mitigation option, and a means of keeping mitigation costs down until other emissions-reduction technologies develop.

Biofuels


  • Corn-based ethanol production has skyrocketed in recent years, and this trend is likely to continue. Nationwide, nearly 130 ethanol biorefineries with total annual production capacity of 6.7 billion gallons are currently2 in operation, making the United States the world's largest producer of ethanol.

  • The almost 80 new plants currently under construction will approximately double current U.S. ethanol production capacity.

  • With more than 13 billion gallons of annual production capacity either already in operation or under construction, domestic ethanol use is poised to far exceed the 7.5 billion gallon annual target established by the federal Renewable Fuels Standard (RFS) adopted in 2005 (the latter policy calls for 5 percent of total U.S. gasoline demand to be met using renewable fuels by 2012). Long-term projections taking into account cost, feedstock supply, and other constraints do not, however, foresee corn-based ethanol production exceeding 15-20 billion gallons annually.

  • The current ethanol boom is affecting practically every aspect of U.S. agriculture. In 2007, the nation's farmers planted a record corn crop, increasing corn acreage by 19 percent. Additional land in corn production largely came from shifting acreage out of soybean production. As a result of strong demand, corn prices have not only remained high but are driving up prices for other commodity crops.

  • Consumer food prices are not expected to be severely affected by high corn prices resulting from the current ethanol boom. Nevertheless, higher feed costs increase consumer prices for poultry, eggs, and red meats. This will likely cause overall retail food prices to rise somewhat faster than the general rate of inflation rate through the end of the decade (2008-2010). After these near-term price adjustments, however, consumer food prices are expected to rise more slowly than the general rate of inflation.

  • Though corn-based ethanol replaces fossil fuels, its capacity to mitigate GHG emissions is limited. Taking into account the entire product life-cycle, the use of corn-based ethanol is estimated to reduce GHG emissions by roughly 10-20 percent relative to gasoline.3 Therefore, the foreseeable expansion of corn-based ethanol production can be expected to only marginally reduce total U.S. GHG emissions (by less than 0.5 percent).

  • More substantial GHG reductions (up to 80-90 percent relative to gasoline) and significantly larger production volumes could be achieved through the successful commercialization of technologies for producing ethanol from cellulosic biomass. But large-scale expansion of this capability requires technological innovations.4



1. Broader issues such as overall energy demand, energy security, climate change agreements,and so forth, are outside the scope of this brief.

2. As of August 22, 2007 (Renewable Fuels Association).

3. M. Wang, M. Wu, and H. Huo, "Life-cycle Energy and Greenhouse Gas Emission Impacts of Different Corn Ethanol Plant Types," Environmental Research Letters 2(2007):1?13; and K. Sanderson, "A Field in Ferment," Nature 444, Business Feature, 673?676, 7 December 2006.

4. M. Wang, M. Wu, and H. Huo, note above.



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