In collaboration with data analytics provider Verisk, David Victor and experts from AXIS Capital, explored how climate change may affect agricultural risk in the United States, specifically looking at the impact on corn yield.
Verisk’s extreme event modelling business unit, AIR Worldwide (AIR), conducted the research to isolate effects of variation in weather and climate on corn yield.
The study took place throughout the US Corn Belt, where AIR’s Crop Growth and Yield Model was used to simulate effects of observed past and projected future climate changes.
The study found out by using climates projected by four climate models as inputs, simulated yields during the decade 2046–2055 were 20–40% less than yields simulated during the 1991–2000 decade due to impact of climate change on weather.
Peter Sousounis, vice president and director of climate change research, AIR Worldwide commented: “There is justified concern about effects of recent and future climate changes on agriculture both in the United States and across the globe.
“If, or when, climate change brings with it more frequent and/or more extreme unfavourable weather to areas of significant crop production, such as the midwestern United States, the potential for significant crop losses and economic impacts could be heightened.
“The purpose of this study is to further explore these possibilities for future, more extreme climate changes involving more frequent and more damaging events reducing productivity of major crops.”
Bob Quane, Chief Underwriting Officer AXIS Insurance added: “Given how much the industry relies on corn production, it’s important to understand its vulnerabilities to the effects of climate change.
“Moreover, learnings from this research can be applied to the agriculture industry as a whole since any disruptions in this sector are likely to affect other global supply chains – from food and beverage to the production of fibres like cotton.
“As insurers and reinsurers, we have a critical role in understanding and mitigating risks posed by climate change. This research, conducted in collaboration with AIR Worldwide and scholars from Brookings, is vital as we continue to navigate our changing world.”
