From cold to hot: Climatic effects and productivity in Wisconsin dairy farms

Abstract

This study examined the effects of climatic conditions on dairy farm productivity using panel data for the state of Wisconsin along with alternative stochastic frontier models. A noteworthy feature of this analysis is that Wisconsin is a major dairy-producing area where winters are typically very cold and snowy and summers are hot and humid. Thus, it is an ideal geographical region for examining the effects of a range of climatic factors on dairy production. We identified the effects of temperature and precipitation, both jointly and separately, on milk output. The analysis showed that increasing temperature in summer or in autumn is harmful for dairy production, whereas warmer winters and warmer springs are beneficial. In contrast, more precipitation had a consistent adverse effect on dairy productivity. Overall, the analysis showed that over the past 17 yr, changes in climatic conditions have had a negative effect on Wisconsin dairy farms. Alternative scenarios predict that climate change would lead to a 5 to 11% reduction in dairy production per year between 2020 and 2039 after controlling for other factors.