A recent study on Latin American countries by de la Torre, Fajnzylber and Nash (2009) concluded that the gravity of the effects would vary between countries and also from region to region within countries. For example, in Mexico some regions would benefit from climate change. However, the findings suggest that negative effects tend to increase as analyses get closer to the equator, and there may be potential benefits in the southern part of the continent.
Gay et al. (2004) applied an econometric model to explore the sensitivity of coffee production in the state of Veracruz, Mexico to changes in climatic and economic variables. Estimates of future coffee production indicate that by 2050 output will decrease significantly (by between 73% and 78%). The economic implications of this fall in production could be devastating, in particular for small producers, whose revenue would fail to cover production costs.
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They assert that if no attention is paid to the effects of CO2, grain yields could decrease by up to 30% by 2080 when a relatively hot scenario is considered. This study also forecasts that demand for water for irrigation will notably increase in hotter climates and lead to more competition between household and agricultural use. Furthermore, the authors show that climate change will cause the salinisation and desertification of arable lands and that by 2050, these events will affect 50% of such land.
The studies conducted offer estimates of how climate change could affect agricultural markets. The results have generally shown that the effects can be quite severe if adaptation mechanisms are not put into