Ensuring that food production is not threatened is an explicit criterion of UNFCCC Article 2. In general, low-latitude areas are most at risk of having decreased crop yields. In contrast, mid- and high-latitude areas could generally, although not in all locations, see increases in crop yields for temperature increases of up to 1-3°C (see Chapter 5 Section 5.4.2). Taken together, there is low to medium confidence that global agricultural production could increase up to approximately 3°C of warming. For temperature increases beyond 1-3°C, yields of many crops in temperate regions are projected to decline (•/*). As a result, beyond 3°C warming, global production would decline because of climate change (•/*) and the decline would continue as GMT increases (•/*). Most studies on global agriculture have not yet incorporated a number of critical factors, including changes in extreme events or the spread of pests and diseases. In addition, they have not considered the development of specific practices or technologies to aid adaptation.
18.104.22.168 Other market sectors
Other market systems will also be affected by climate change. These include the livestock, forestry and fisheries industries, which are very likely to be directly affected as climate affects the quality and extent of rangeland for animals, soils and other growing conditions for trees, and freshwater and marine ecosystems for fish. Other sectors are also sensitive to climate change. These include energy, construction, insurance, tourism and recreation. The aggregate effects of climate change on many of these sectors has received little attention in the literature and remains highly uncertain. Some sectors are likely to see shifts in expenditure; with some contracting and some expanding. Yet, for some sectors, such as insurance, the impacts of climate change are likely to result in increased damage payments and premiums (see Chapter 7).
Other sectors, such as tourism and recreation, are likely to see some substantial shifts (e.g., reduction in ski season, loss of some ski areas, shifts in location of tourist destinations because of changes in climate and extreme events; e.g., Hamilton et al., 2005; see also Chapter 7 Section 7.4.2 and Chapter 14 Section 14.4.7). Global net energy demand is very likely to change (Tol, 2002b). Demand for air-conditioning is highly likely to increase, whereas demand for heating is highly likely to decrease. The literature is not clear on what temperature is associated with minimum global energy demand, so it is uncertain whether warming will initially increase or decrease net global demand for energy relative to some projected baseline. However, as temperatures rise, net global demand for energy will eventually rise as well (Hitz and Smith, 2004).