Conclusions regarding the consequences of climate change for the agriculture sector in the SAR (Reilly et al., 1996) provide an important benchmark for this section. The focus in this section is on basic mechanisms and processes that regulate the sensitivity of agriculture to climate change, relying mostly on research results since the SAR. Specifically, we ask how the conclusions of the SAR have stood the test of new research. Research advances since the SAR have brought several new issues to light—for example, understanding the adaptation of agriculture to climate change.

The discussion in this section is guided by the State-Pressure-Impact-Response-Adaptation model (see Figure 5-1). The pace of social, economic, and technological change in the agriculture sector will steadily transform the setting in which climate change is likely to interact with sensitive features of the food system. The current state of the sector and important trends that would transform it provide a baseline against which to examine the potential consequences of climate change (Section 5.3.1). Multiple pressures are being exerted on the agriculture sector, including the need to meet rising demand for food and fiber, resource degradation, and a variety of environmental changes (Section 5.3.2). Agricultural impacts, response, and adaptation are discussed concurrently because they are inseparable parts of the calculus of the vulnerability of agricultural systems to climate change. Hence, we consider the response and adaptive potential of agriculture in each of the succeeding sections. Agriculture is likely to respond initially to climate change through a series of automatic mechanisms. Some of these mechanisms are biological; others are routine adjustments by farmers and markets. Note that we equate response with automatic adaptation, as discussed in Chapter 18.

Climate change will impact agriculture by causing damage and gain at scales ranging from individual plants or animals to global trade networks. At the plant or field scale, climate change is likely to interact with rising CO₂ concentrations and other environmental changes to affect crop and animal physiology (Section 5.3.3). Impacts and adaptation (agronomic and economic) are likely to extend to the farm and surrounding regional scales (Section 5.3.4). Important new work also models agricultural impacts and adaptation in a global economy (Section 5.3.5). Finally, the vulnerabilities of the agriculture sector, which persist after taking account of adaptation, are assessed (Section 5.3.6).

As Reilly et al. (1996) argue in the SAR, one of the foremost goals for global agriculture in coming decades will be expansion of the global capacity of food and fiber in step with expansion of global demand. Agriculture in the 20th century accomplished the remarkable achievement of increasing food supply at a faster rate than growth in demand, despite rapidly growing populations and per capita incomes. Key summary indicators of the balance between global demand and supply are world prices for food and feed grains. Johnson (1999) and Antle et al. (1999a) show that during the second half of the 20th century, real (inflation-adjusted) prices of wheat and feed corn have declined at an average annual rate of 1-3%. Climate change aside, several recent studies (World Bank, 1993; Alexandratos, 1995; Rosegrant et al., 1995; Antle et al., 1999a; Johnson, 1999) anticipate that aggregate food production is likely to keep pace with demand, so that real food prices will be stable or slowly declining during the first 2 decades of the 21st century.

According to the U.S. Department of Agriculture (1999), food security¹ has improved globally, leading to a decline in the total number of people without access to adequate food. The declining real price of food grains has greatly improved the food security of the majority of the world's poor, who spend a large share of their incomes on these staples. The global number, however, masks variation in food security among regions, countries, and social groups that are vulnerable because of low incomes or a lack of access to food (FAO, 1999a). In lower income countries, political instability and inadequate physical and financial resources are the root causes of the food security problem (see Section 5.3.6). In higher income, developing countries, food insecurity stems from unequal distribution of food that results from wide disparities in purchasing power.

Agricultural production and trade policies also affect global food availability and food security. There is a widespread tendency for high-income countries to maintain policies that effectively subsidize agricultural production, whereas low-income countries generally have policies that tax or discourage agricultural production (Schiff and Valdez, 1996). Many low-income countries also pursue policies that promote food self-sufficiency. Although all of these policies tend to reduce the efficiency of agricultural resource utilization in low- and high-income countries, they have not changed long-run trends in global supply and demand (Antle, 1996a).

Relatively few studies have attempted to predict likely paths for food demand and supply beyond 2020. There are reasons for optimism that growth in food supply is likely to continue apace with demand beyond 2020. For example, population growth rates are projected to decline into the 21st century (Bos et al., 1994; Lutz et al., 1996; United Nations, 1996), and multiple lines of evidence suggest that agricultural productivity potential is likely to continue to increase. Rosegrant and Ringler (1997) project that current and future expected yields will remain below theoretical maximums for the foreseeable future, implying opportunities for further productivity growth.

Other analysts are less optimistic about long-term world food prospects. For example, there is evidence that the Asian rice monoculture may be reaching productivity limits because of adverse impacts on soils and water (Pingali, 1994). Tweeten (1998) argues that extrapolation of the downward trend in real food prices observed in the latter half of the 20th century could be erroneous because the supply of the best arable land is being exhausted and rates of productivity growth are declining. At the same time, demand is likely to continue to grow at reasonably high rates well into the 21st century. Other studies indicate concerns about declining rates of investment in agricultural productivity and their impacts on world food production in some major producing and consuming areas (Hayami and Otsuka, 1994; Rozelle and Huang, 1999). Ruttan (1996) indicates that despite advances in biotechnology, most yield improvements during the first decades of the 21st century are likely to continue to come from conventional plant and animal breeding techniques. These concerns about future productivity growth, if correct, mean that simple extrapolation of yield for impact assessment (e.g., Alexandratos, 1995) may be overoptimistic. The implication is that confidence in predictions of the world food demand and supply balance and price trends beyond the early part of the 21st century is low.

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