Managing Climate Risks on the Ranch with Limited Drought Information


Ranching involves complex decision-making and risk management in the face of uncertainty about climate conditions. The profitability and sustainability of ranching depend heavily on sufficient and timely rainfall for rangeland forage production. As a result, ranchers may either adopt conservative long-term stocking strategies as a hedge against drought or practice a more dynamic approach in which they vary stocking rates and supplemental feed in response to drought. Yet, some strategies require more information about climate risks than is often available to ranchers. We review the literature to draw out the drought management options as well as the tools and products for drought monitoring and early warning that are available to ranchers. We find that a large gap remains between the information needs of ranchers seeking to adapt dynamically to drought and the information that is available. Moreover, even when actionable information is available, it is unclear whether ranchers are optimally incorporating that information into their risk management decisions. Further research is needed to understand how to package existing information into risk management decision tools in a way that addresses cognitive and operational barriers to support timely decisions that will reduce the impact of drought on profits and the long-term sustainability of rangelands. Due to the multi-faceted nature of climate risk management in ranching, further study of ranching behavior and decisions has the potential to bring new insights into climate risk management and decision and risk theory far beyond the field of ranching and agriculture.

Publisher's Version

Last updated on 03/14/2018