Title : Adjusting crop plans to manage climate risk using financial modeling
Abstract:
In the last decade or so, weather patterns have become more extreme and unpredictable. Different parts of the globe have experienced a range of devastating rains, scorching droughts that fuel wildfires, hurricanes, and unseasonable temperatures. Crop plans that made sense a few years ago, may need to be modified to take into consideration the risk of extreme weather events.
Farming has always been a risky venture. With little control over the weather, a freak snowstorm or severe hurricane can wipe out wide swaths of production. And as weather patterns become more erratic, the high value crops are also the highest risk. Climate change has affected agri-business strategies - from deciding what to grow, when to plant, and what infrastructure is needed.
In this session, we will go through 2 case studies of how farmers used financial modeling to evaluate shifting priorities, risk tolerance and profit goals. The farmer in the first case studies grows flowers in California and faces risks of wildfires and drought. The farmer in the second case study grows diversified vegetables in New York and faces threats of severe rain and hurricanes, and is considering the purchase of new infrastructure.
Audience Take Away Notes:
- The audience will learn how to consider financial risk in context of climate risk.
- The audience will learn how straight-forward financial modeling and frameworks can be used for in these and other scenarios.
- For audience members who educate and coach farmers, they will have new tools to use with their clients.
