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Agriculture Assets Face $8 Trillion Risk from Climate Change, Water Scarcity

stranded assetsEnvironmental hazards such as climate change, land degradation and water scarcity could wipe out as much as $8 trillion in agriculture assets each year, a major study warned.

The study, released today by the University of Oxford’s Smith School of Enterprise and the Environment, aims to show the scale of the asset bubble faced by the agricultural sector. The study focuses on so-called stranded assets, a term used to describe environmentally unsustainable assets that suffer from unanticipated or premature write-offs, downward revaluations or are converted to liabilities, and can be caused by a range of environment-related risks.

The potential challenge of stranded assets in agriculture is currently being exacerbated by an ongoing agricultural boom, which is feeding off high commodity prices and poor investment returns elsewhere in the economy to push farmland values to record highs in many markets, the study says.

The study determined value at risk calculations under three scenarios: current, moderate and extreme. The report found a one in 20 chance the world’s farmland assets and agricultural capital stock could lose between $4.4 trillion (the current scenario) and $8 trillion (the extreme scenario) in a single year.

The study also determined the total natural capital cost from agriculture is $2.369 trillion each year in terms of lost ecosystem services.
Cornell University has started a center to help farmers adapt their operations to climate change. The Cornell Institute for Climate Change and Agriculture will serve as a clearinghouse for research, climate monitoring, decision-support tools and applications at the intersection of climate and agriculture.One of the institute’s first steps will be to develop a website for disseminating and gathering information on farm-level impacts and trends, losses and gains from extreme weather and climate change, according to the university news site.
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2 thoughts on “Agriculture Assets Face $8 Trillion Risk from Climate Change, Water Scarcity

  1. What kind of a responsible planet lover condemns their own children with 28 years of science ONLY agreeing their own “comet hit of an earthly emergency” could happen and have never said anything close to “will” happen like they say comet hits are. Not one IPCC warning has said; “eventual” or “inevitable”. History will view 28 years of needless CO2 panic and CO2 death threats to billions of children as a pure war crime.
    How close to unstoppable warming will science lead us before they finally end this costly debate and actually say it actually WILL happen? A real crisis has a real warning, not; “Help my planet could be on fire maybe.”
    Note: *Occupywallstreet now does not even mention CO2 in its list of demands because of the bank-funded and corporate run carbon trading stock markets ruled by politicians for taxing the air we breathe.

  2. This is about the fourth time that mememine69 has cut&paste essentially the same meaningless troll-line into a comment section at this site. Here are some of the other occasions:
    http://www.environmentalleader.com/2013/03/18/manufacturers-freaked-out-about-climate-guidelines/comment-page-1/#comment-961141
    http://www.environmentalleader.com/2013/04/22/climate-change-and-the-water-industry/comment-page-1/#comment-1019648
    http://www.environmentalleader.com/2013/05/20/taking-stock-of-climate-change-efforts-as-european-carbon-market-falters-ca-expands-cap-and-trade-to-canada/comment-page-1/#comment-1062619
    As on the other occasions, I reply that such troll-lines are false and irrelevant. OccupyWallStreet, for example, has nothing whatsoever to do with climate change. The same can be said for comet hits. And the silly nonsense about scientific certainty is just that: silly nonsense. Such remarks say far more about the lack of scientific understanding posssessed by the person making them; than they do about any science or about the well-accepted scientific standing of climate change.

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