EFFECTS OF CLIMATE CHANGE ON CEREALS PRODUCTIONS AND PRICES IN GHANA

Abstract

Cereals play a substantial role in meeting the food needs of many households and in serving as a source of animal feed. Globally, climate change poses a significant threat to agricultural production since crop production and the variety of crops produced is a function of the climate system. This study examined the effects of climate change on cereals production and prices in Ghana using time series data spanning from 1970 to 2018. The study employed the Autoregressive Distributed Lag cointegration approach to determine the dynamic relationship between the variables employed in the study. Further, Ljung Box test and ARCH-LM were used to examine the serial autocorrelation and conditional heteroscedastic property of the residuals in the models. The emission of C02 and rainfall exhibits an increasing trend while that of rainfall reveals a fluctuating trend. However, all the climate variables are best characterized by the log-linear trend. Also, maize and rice production showed an increasing trend while that of millet and sorghum showed a fluctuating trend during the year under study. However, the trend of prices of the cereals revealed a generally increasing trend. The dynamic relationship between each cereal and their respective prices showed no cointegration relationship. However, there exists a strong cointegration relation among the prices of the various cereals employed. The cointegration relationship between the climate change variables and cereals production as well as the cereals prices reveal no cointegration relation. This indicates that by far cereals production and their prices in Ghana are unhindered by climate change-imposed restrictions.