Change in cereal production caused by climate change in Malaysia

This study attempts to estimate the effects of climate change variables, such as average temperature, CO₂ emissions and average rainfall, on cereal production in Malaysia from 1969 to 2018. After preliminary tests on time series data, we employed a novel autoregressive distributed lag (ARDL) method known as the dynamic ARDL simulations technique. The results showed that a long-run co-integration relationship exists between cereal production and climatic and non-climatic factors. All climate variables have a negative impact on cereal yield, while energy consumption and cultivated land have a positive effect on cereal yield in the short- and long-run. Granger causality analyses also showed that a unidirectional causality link exists between rainfall and temperature with cereal production and between CO₂ emissions and cereal production. Energy consumption, as a proxy for technology, has a one-way Granger cause with cereal production. The results of the dynamic ARDL simulations suggest that cereal yield was most sensitive to CO₂ emissions, rainfall and temperature. In the long run, a 1% increase in temperature is associated with a 2.87% and 3.52% decrease in general and predicted estimates of cereal production, respectively. The dynamic ARDL simulations methodology provides a better understanding of the variability of cereal production in Malaysia as a result of climate change.