In recent decades, Australia has seen a shift towards higher temperatures and lower winter rainfall, which has had significant effects on many farmers. Despite these trends there remains much uncertainty over the long-run effects of climate change on farm businesses. This article presents ABARES latest modelling, examining the effects of recent and possible future changes in climate on the profitability of Australian farms. Productivity trends are also presented, showing how farm adaptation has helped to offset the effects of hotter and drier conditions to date.
