Powdery Mildew Forecasts & California Wine Grape Growers: Do Disease Forecasts Benefit The Environment By Altering Risk Management Strategies?

• Environmental and Resource Economics Workshop

Date and Location

Friday, November 12, 2010, 12:10 PM - 1:00 PM

Abstract

How and how well growers manage the risks inherent in agriculture has direct welfare implications for producers and consumers at both local and societal levels. While better weather, pest and disease forecast information are rapidly disseminating among producers and are often touted as promising inputs to production and risk management, little is known about how this new information actually shapes producer behavior in practice. Better forecast information can benefit growers and improve their capacity to manage disease and pests effectively, but we must jointly consider multiple margins of adjustment in order to properly understand their response to this improved information. Using the case of California wine grape growers and high resolution panel data that includes plot-level powdery mildew treatments, we characterize growers' response to a popular powdery mildew risk model that generates forecast in the form of a daily risk index (PMI). Our analysis suggests that growers using the PMI primarily adjust their choice of product in response to the PMI by switching to higher potency synthetic fungicides when the risk is high. Since these products have longer minimum intervals, this implies that - if anything - PMI users have longer intervals as the PMI increases. Many have promoted disease forecasting as a way to reduce pesticide usage, but our results suggest that the net environmental impact of growers' multi-dimensional response to the PMI may actually be negative. The magnitude of this effect, however, is small compared to the general improvements in wine grape growers' environmental impact over the past several years.