ECONOMIC IMPACTS OF CLIMATE CHANGE AND DROUGHT ON WYOMING RANCHERS: A CRITICAL EVALUATION

• Sponsoring Institution: National Institute of Food and Agriculture
• Project Status: COMPLETE
• Funding Source: MCINTIRE-STENNIS
• Reporting Frequency: Annual
• Accession No.: 0232198
• Project Start Date: Jan 1, 2013
• Project End Date: Dec 31, 2015
• Program Code: [(N/A)]- (N/A)

Recipient Organization
UNIVERSITY OF WYOMING
1000 E UNIVERSITY AVE DEPARTMENT 3434
LARAMIE,WY 82071-2000

Performing Department
Agricultural And Applied Economics

Non Technical Summary
Our modeling efforts will examine the economic consequences of drought on eastern Wyoming livestock operations. Our analyses will focus on drought management, including future projections of drought as predicted under potential climate change scenarios. Not only will our analyses examine the costs of these drought events on livestock operations, they will also analyze various operational strategies to evaluate the effectiveness of each to minimize the economic risk associated with drought and climatic variability. Our work will extend previous work related to drought management conducted for western Wyoming by expanding the analyses through incorporating future climate projections as well as examining the direct impacts of climate on livestock production by including production parameters estimated from previously unavailable data. It is expected that our work will help guide producers through decision making processes (mainly stocking rates and operational organization) as they become aware of the risks of pending climate change, and the increased variability in precipitation it poses.

Animal Health Component

(N/A)

Research Effort Categories

Basic

(N/A)

Applied

(N/A)

Developmental

(N/A)

Classification

Knowledge Area (KA)	Subject of Investigation (SOI)	Field of Science (FOS)	Percent
601	3310	3010	85%
306	0790	3010	15%

Knowledge Area
601 - Economics of Agricultural Production and Farm Management; 306 - Environmental Stress in Animals;

Subject Of Investigation
3310 - Beef cattle, live animal; 0790 - Rangelands, other;

Field Of Science
3010 - Economics;

Keywords

economic modeling

drought

grazing

climate change

livestock

rangelands

Goals / Objectives
Specific research objectives are to: 1) develop relevant firm level economic models of cattle production systems, specific to eastern Wyoming; 2) aggregate climate change projections from a variety of sources into a suite of regionally relevant scenarios for impacts of temperature and precipitation on cattle production; 3) analyze the potential firm level outcomes of relevant management alternatives using the economic models and climate scenarios developed for objectives 2 and 3; 4) develop regionally relevant recommendations related to adaptation to climate change, including drought management, for producers; 5) extend our results to livestock producers via existing extension outlets. Specific Outputs will include: 1) Development and dissemination of results at local field days and extension trainings, 2) Graduate Student graduation in Ag Economics, and 3) Materials to be used by extension personnel across the state.

Project Methods
The process of quantifying potential impacts of climate change on livestock production, and potential benefits and costs of alternative adaptations, will involve a Multi-period Linear Programming (MLP) model that will be parameterized to both current and potential future climate conditions. By default, the MLP will have a fixed time horizon with full knowledge of precipitation and temperature patterns prior to management decisions. This will allow us to model the best-case response to weather under the various climate scenarios analyzed. Our model will examine the economic performance of the typical cow/calf production system observed in the study area, as well as more flexible alternatives (e.g. later calving dates, earlier weaning dates, or retaining yearlings as a way to increase flexibility of livestock systems to increased variability in precipitation) that may help producers adapt to a changed climate. Results will be compared across current and predicted future conditions. The MLP model will be configured to maximize the Net Present Value of livestock returns over a specific planning horizon. Climatic variables will be used as exogenous variables that will impact forge production, as well as impacting livestock performance both through changes in forage production as well as directly as indicated by the HPGRS models. Various management strategies will be analyzed for the same climatic/market conditions in order to provide meaningful comparison of alternative management strategies both over short-term weather events (less than 5 years) as well as long-term planning horizons (20-40 years). We plan to disseminate the results associated with our project via numerous outlets, both academic and extension related.

Progress 01/01/13 to 12/31/15

Outputs
Target Audience:Livestock producers and land managers in the Intermountain West, as well as policy makers that affect this audience. Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided?Results have been presented at local extension outlets. How have the results been disseminated to communities of interest?The results have been disseminated to both academic and extension audiences. What do you plan to do during the next reporting period to accomplish the goals? Nothing Reported

Impacts
What was accomplished under these goals? The graduate student has defended his thesis, which has resulted in a manuscript that is currently under review at Rangeland Ecology and Management. The thesis includes a relevant firm level model that incorporates climate impacts on both forage and livestock production over time. The model estimates the impacts of various climate projections on firm level profitability over a variety of firm structures. The results have been presented at various academic and Extension outlets, and will continue to be marketed in the area.

Publications

• Type: Conference Papers and Presentations Status: Published Year Published: 2016 Citation: Ritten, John, Tucker Hamilton, Christopher Bastian, Justin Derner, John Tanaka. Management Implications of Increasing Seasonal Precipitation and Source of Supplemental Funds on SE Wyoming Cattle Producers. Presented at the Western Regional Science Association 55th Annual Meeting, February 17, 2016, Waikoloa, HI.
• Type: Conference Papers and Presentations Status: Published Year Published: 2016 Citation: Hamilton, Tucker, John Ritten, Christopher Bastian, Justin Derner, John Tanaka. Economic Impact of Increasing Seasonal Precipitation Variation on Cow-Calf Enterprises. Presented at the Society for Range Management Annul Meeting, February 1, 2016, Corpus Christi, TX. Part of the Responding Rationally to Uncertainty Organized Symposium. Invited. (Presented by Ritten)
• Type: Conference Papers and Presentations Status: Published Year Published: 2014 Citation: Hamilton, Tucker, John Ritten, Chris Bastian, John Tanaka, and Justin Derner, Management Implications of a Changing and Variable Climate for Production in Southeast Wyoming, Presented at the Western Agricultural Economics Association Meetings, June 22-24, 2014, Colorado Springs, Co. (Presented by Bastian)
• Type: Journal Articles Status: Submitted Year Published: 2015 Citation: Hamiton, Tucker, John Ritten, Christopher Bastian, Justin Derner, and John Tanaka. Economic Impacts of Increasing Seasonal Precipitation Variation on Cow-Calf Enterprises. Submitted to Rangeland Ecology ad Management. Submitted September 25, 2015. Received Revise and Resubmit offer November 30, 2015.
• Type: Conference Papers and Presentations Status: Published Year Published: 2015 Citation: Ritten, John. Economic Impacts of Increasing Seasonal Precipitation Variation on Cow-Calf Enterprises. Wyoming Section of the Society for Range Management Winter Meeting. Laramie, WY. November 5, 2015. Invited.

Progress 10/01/13 to 09/30/14

Outputs
Target Audience: The target audience is cattle producers in SE Wyoming, although results will be applicable to livestock producers in the intermountain west. Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided? The graduate student has been involved in professional development such as software training and public speaking demonstrations. How have the results been disseminated to communities of interest? Initial results have been presented via departmental seminars, regional conferences, and local producer meetings. What do you plan to do during the next reporting period to accomplish the goals? A final draft of a thesis will be submitted. Following this action, academic articles will be submitted and extension presentations will be arranged.

Impacts
What was accomplished under these goals? The graduate student has defended his thesis, which is currently being finalized. The thesis includes a relevant firm level model that incorporates climate impacts on both forage and livestock production over time. The model estimates the impacts of various climate projections on firm level profitability over a variety of firm structures. Once the thesis is complete, the results will be submitted for publication in both academic and extension outlets. Also, local producers will be made aware of the findings through local meetings, currently being initiated with county-based extension educators.

Publications

• Type: Conference Papers and Presentations Status: Published Year Published: 2014 Citation: Hamilton, T., J. Ritten, C. Bastian, S. Lake, D. Mount, S. Paisley, D. Peck, J. Derner, and J. Reeves. Economic Impacts of Climate Change and Drought on Wyoming Ranchers. University of Wyoming, Agricultural Experiment Station, 2014 Field Days Bulletin.

Progress 01/01/13 to 09/30/13

Outputs
Target Audience: The target audience is cattle producers in SE Wyoming, although results will be applicable to livestock producers in the intermountain west. Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided? The graduate student has been involved in professional development such as software training and public speaking demonstrations. How have the results been disseminated to communities of interest? Nothing Reported What do you plan to do during the next reporting period to accomplish the goals? The graduate student will have completed the economic modeling, and both academic and extension materials will be prepared. Results will be disseminated to various producers groups at regional meetings.

Impacts
What was accomplished under these goals? Thus far, the physical impacts of climate on forage and beef calves have been estimated. Currenlty, work is underway to build the economic model to determine how varible climate impacts livestock profitability through these physical relationships. The graduate student involved has completed his coursework, and is involved in model development.

Publications