The Organization for Economic Cooperation and Development (OECD) recently released a report on their assessment of how climate change, water and agriculture are going to interact in the years ahead. Last week’s commentary discussed the rationale behind linking these together. This week’s commentary focuses on the five levels of action the OECD believes are required to successfully deal with this important topic.
The first is on-farm adaptation of water management practices within cropping and livestock systems. The OECD asserts there is a place for public policies that can range from knowledge transfer and technical support to cost-shared financial assistance.
The second is watershed level adaptation of water supply and demand policies in agriculture and with the other water users and ecosystems uses. These policies include water allocations, water pricing and water trading. These policies are controversial because adding costs and limits on water availability will likely improve management of water by users but it carries political costs to those introducing and imposing the rules. The OECD calls for short-run incentives that allow farms to cope within the growing season and long-run incentives to adapt to changing patterns of water supply in other areas such as growing urban populations and their demands.
The third is risk management against extreme events such as droughts and floods. Up until now, the relative rarity of these events makes them difficult to insure properly. If the frequency of these events is changing, new tools are required.
The fourth is adaptation of existing agricultural policies and markets to the changing climate. The OECD asserts that open trade is essential to maintaining stability in the global price of goods. Pooling risk at the global level means that a failure in one area will not have a disproportionate impact on price. The OECD also asserts that private and competitive storage markets will be needed to smooth price uncertainty.
Finally, the interactions between climate change mitigation practices and adaptation of water management needs to be better understood. These will be site specific interactions and may have synergies or require trade-offs. The implication is that as mitigation policies are developed, they need to consider the best way to find synergies alongside water management to ensure there is the best outcome possible. Without that conscious effort, it will be easy to develop self-defeating policies.
The OECD report outlines how they believe policy makers need to approach climate change and its impact on water availability for agriculture. The Ontario government and farmers need to have a serious discussion about whether to follow some or all of the recommendations when it comes to planning for the long-term prosperity of agriculture in this province.
Source: CFFO