Resource reallocation under climate risk: assessing the economic and ecological impacts of rising temperatures on cattle farming in tropical Island economies

This study examines the economic, ecological, and adaptive responses of cattle farming to rising temperatures in Sri Lanka, a tropical Island developing country that is increasingly exposed to climate-induced heat stress. Using district-level panel data from 2008 to 2022, merged with high-resolution climate records and satellite-based land cover data, the study provides a comprehensive assessment of temperature-driven changes in milk collection, breed composition, and environmental conditions. Results reveal that a 1 °C increase in mean annual temperature leads to a 54% reduction in formal milk collection, equivalent to an estimated annual economic loss of approximately USD 2 million. A finer-grained monthly analysis further suggests a 0.54% decline in annual milk collection for every 0.01 °C temperature rise, highlighting the acute vulnerability of cattle-based milk production systems. . Temperature-induced shifts in cattle breed dynamics were also observed: high-yielding improved breeds declined significantly under warming conditions. At the same time, heat-tolerant local crossbreeds showed relative resilience or even growth, highlighting adaptive breeding as a key coping strategy. Remote sensing analysis revealed parallel environmental deterioration, including reductions in vegetation density and freshwater availability, which are essential factors for sustaining cattle farming in dry zones. These trends are particularly critical in the Northern, North Central, and part of the Eastern region, where warming has been most intense. The findings show the interconnection between climate, dairy milk collection, land use, and water resources in vulnerable agricultural systems. Policy recommendations include promoting heat-tolerant cattle breeds, predominantly meat breeds in the dry-zone regions, drought-resilient fodder crops, and integrated water conservation strategies. These interventions can strengthen adaptive capacity and long-term sustainability in cattle farming, aligning with global climate resilience goals and sustainable agricultural development pathways.