Climate change impacts on investment in crop sowing machinery*

A model of investment in crop sowing machinery is applied to wheat productionunder current and projected climatic conditions at several locations in south-westernAustralia. The model includes yield responses to time of sowing at each location givencurrent and projected climatic conditions. These yield relationships are based onwheat growth simulation modelling that in turn draws on data from a down-scaledglobal circulation model. Wheat price distributions and cost of production data ateach location, in combination with the time of sowing yield relationships are used todetermine a farmer’s optimal investment in crop sowing work rate under each climateregime. The key finding is that the impacts of climate change on profit distributionsare often marked, yet mostly modest changes in investment in work rate form part ofthe profit-maximising response to climate change. The investment response at highversus low rainfall locations mostly involves increases and decreases in work rates,respectively. However, changes to investment in work rate within a broadly similarrainfall region are not always uniform. The impacts of climate change on investmentsin work rate at a particular location are shown to require knowledge of several factors,especially how climate change alters the pattern of yield response to the time of sowingat that location.