Climate inaction could have a heavy financial toll on Iowa farmers
Agriculture is the lifeblood of Iowa’s rural economy. In 37 of Iowa’s counties, more than half of total economic output derives from agriculture and related industries.
While Iowa farmers have experienced favorable farming conditions in recent decades, agriculture is one of the most vulnerable sectors to climate change. More frequent extreme weather events, as well as rainfall and temperature changes, put crop production at risk.
To understand the extent of these risks on Iowa farmers, communities and the state’s economy, Environmental Defense Fund commissioned K·Coe Isom to model the potential climate change impacts on Iowa corn, soy and silage production over the next two decades. The report also outlines a range of promising policies that can support farmers in building resilience.
The report finds that, under the worst case scenarios, the costs of climate inaction could have a heavy financial toll on individual farmers and state and local governments in Iowa:
- Iowa farmers could see statewide gross farm revenues reduced by as much as $4.9 billion per decade. Because with climate change agricultural prices are likely to rise, relative to without climate change, the impact to gross farm revenues from yield impacts will be offset to some degree by higher prices.
- 92 of Iowa’s 99 counties could experience decreases in gross farm revenues. 45 of Iowa’s counties are predicted to experience high-end farm revenue losses of more than $50 million and eight counties are predicted to experience high-end farm revenue losses of more than $100 million.
- For individual farmers, these losses could reduce the capital needed for purchasing supplies and equipment and for off-farm expenses including groceries, educational expenses and more. These financial impacts would also make it difficult to keep farms viable in the long run.
- This loss in capital investment and spending could have a ripple effect across the state’s entire economy, causing a statewide loss of up to 2,500 jobs, reducing annual state revenue collections by $4 million and cutting Iowa’s annual economic output by more than $360 million.
Solutions to support agricultural resilience
Urgent action is needed to reduce emissions and minimize impacts on farmers. The report outlines how policies can provide incentives and other support to boost agricultural resilience to climate change:
- Management practices: Policies should seek to incentivize management practices that limit greenhouse gas emissions, improve soil health, and build resilience in agriculture. These include practices that reduce emissions from nitrogen fertilizers and manure applied to farmers’ fields; as well as practices that support soil health improvement and soil health management practices.
- Incentives: Federal policies and programs can provide incentives for conservation practices, including through tax credits for farmers who implement sequestration and best management practices; and Farm Bill programs that utilize and incentivize climate-friendly practices. Establishing markets for greenhouse gas credits can allow farmers to generate credits by implementing conservation practices that also reduce emissions.
- Crop insurance and agriculture lending: Efforts to improve federally subsidized crop insurance, such as incorporating data that accounts for climate impacts, can help protect farmers and the broader agricultural economy from climate risk. Agricultural lenders can also create incentives for Iowa farmers who adopt resilient farming practices.
- Research and technical expertise: Governments should support research to inform conservation management practices, including providing funding for climate-adaptation technologies and ensuring that research is readily available to farmers to implement on the ground.