Dairy faces rising climate pressures. Building resilience can help.

This post was co-authored by Maddie Stein, EDF.

Unpredictable weather patterns caused by climate change are already impacting the dairy sector, a reality that is only expected to worsen. In fact, extreme weather like heatwaves, droughts and extreme precipitation is projected to not only persist into 2030 but also intensify by 2040. As these hazards increase, the risks they pose to supply chains will, too.

These climate impacts can have detrimental effects on animal health and milk yield, feed availability and prices, and farm equipment and operations. This ultimately causes disruptions throughout dairy supply chains, even as dairy is projected to grow, with outcomes like price volatility, sourcing instability and logistical challenges for dairy-sourcing companies.

In fact, a recent Cornell University study estimates that the milk productivity and quality losses associated with heat stress on cattle could lead to annual losses of $1.65 billion for the U.S. dairy sector. Recent and ongoing droughts have already caused feed shortages for dairy-producing regions from California to New York. These losses could grow as climate hazards worsen.

Invest in risk resilience now to strengthen supply chains in the future

More frequent seasonal shortages in milk procurement, higher average procurement costs, greater reliance on unpredictable spot markets and other issues with processing capacity all pose serious challenges to supply chains — challenges that are already being exacerbated by the impacts of climate change.

Companies that take action now to build resilience can reduce the financial pressure of those risks. Adaptation strategies can help reduce vulnerability to climate hazards. These strategies include installing fans and sprinklers to cool cattle and implementing soil health practices to protect feed crops in the face of drought.

Pairing adaptation with mitigation strategies, like improved manure management and herd nutrition, can reduce the sector’s contribution to climate hazards themselves. By implementing mitigation strategies as well as adaptation, companies can address the root climate risks rather than only adapting to them as they happen.

Make adaptation and mitigation accessible

If companies invest in mitigation today, they can help protect their supply chain from the volatility and shocks of extreme weather by seeking to lower the intensity of that weather.

Many of these strategies already exist. On-farm emissions mitigation practices like manure management technology and feed supplements have already been shown to reduce methane emissions, which will in turn slow the rate of warming.

For many farmers, the financial risk of conservation practice adoption is high, and food, dairy and retail companies can step in to help close the gap, tailoring support across farm contexts. One option is to provide financing for adaptation investments like cooling systems or water storage to prepare for heat waves and drought. Another is to work with financial institutions to offer farmers low-cost loans, loan guarantees and other forms of affordable capital for mitigation solutions.

Scaling solutions will require collaboration from multiple actors: food and dairy companies, producers, financial institutions and the public sector all play a role.

Dairy can lead in climate mitigation and resilience

Dairy systems have long been at the forefront of innovation and technology. It is therefore well-suited to continue to innovate in the face of climate change, building business value through enhanced mitigation. But farmers need support to de-risk climate investments. That support will not only drive emissions reductions, but it will also build stability across the supply chain for decades to come.