CLIMATE CHALLENGESAs Temperatures Rise, the U.S. Corn Belt Could See Insurance Claims Soar
Crop insurance is a lifeline for farmers. But research shows it’s not ready for climate change, as global warming worsens, bringing more uncertainty to the agricultural sector.
In the United States, farmers have access to federally subsidized crop insurance — a backstop that affords them some peace of mind in the face of extreme weather. When droughts, floods, or other natural disasters ruin a season’s harvest, farmers can rely on insurance policies that will pay out a certain percentage of the expected market value of the food, saving them from financial ruin.
But that insurance program could become strained as global warming worsens, bringing more uncertainty to the agricultural sector.
A new study models how harvests in the U.S. Corn Belt — the swath of Midwestern states including Indiana, Illinois, and Iowa that produce the vast majority of the nation’s corn — could fluctuate over the next few decades under a warming scenario projected by United Nations climate scientists. The researchers compared these results to a scenario with no warming, in which tomorrow’s growing conditions are the same as today’s. They found that, as temperatures continue to rise, the nation’s corn growers are likely to see more years with lower yields — and the losses they incur during those years will also be greater.
The study projects that the likelihood of corn growers’ yields falling low enough to trigger insurance payouts could double by 2050, creating financial strain for both farmers and the government.
The findings demonstrate how growing climate impacts like unprecedented heat could destabilize the business of growing food and the nation’s food supply. Reduced corn yields would be felt widely, as the crop is used to feed cattle, converted into fuel, and refined into ingredients used in processed foods, among other applications.
“Corn is so essential to the U.S. food system,” said Sam Pottinger, a data scientist at University of California, Berkeley and the lead researcher of the study. “There’s the corn we eat, but we also feed it to the livestock. It’s just an absolute cornerstone to how we feed everyone in the country.”
In recent years, climate change has strained the U.S. property insurance market, as insurance companies have raised homeowners’ premiums and in some cases pulled out of risky areas altogether. Pottinger’s study seems to reflect similar cracks in the federal crop insurance system, which wasn’t designed to account for the kind of yield volatility farmers are likely to experience if the rise in global temperatures continues unmitigated.
