From Forecasts to Fields: How Agro-Dealers Shape Input Availability for Climate Adaptation

Climate change is increasing weather variability across Sub-Saharan Africa, exacerbating uncertainty in agricultural production. Farmers can adapt to changes in expected growing conditions by shifting between maize seed maturity types. Local input providers, agro-dealers, facilitate adaptation by determining which seeds are available to farmers even as dealers grapple with demand uncertainty. In this context of market and production risks, seasonal forecasts can help agro-dealers and farmers align their expectations of upcoming growing seasons. Using a panel of 748 agro-dealers from 2021 to 2023 and leveraging plausibly exogenous variation in seasonal forecasts across counties, we study adaptation responses in Kenyan maize seed markets. We build a theoretical framework to model how forecasts influence expected demand and agro-dealer stocking decisions, and how this can vary by agro-ecological zone. This framework motivates our estimation of the reduced form equilibrium response of realized seed sales to forecasts, which embed both supply and demand decisions. We specifically estimate the marginal change in the maturity profile of maize seed sold when the forecast deviates from normal. We find that the portfolio of maize seed sold shifts in response to forecasts, but that adjustments are relatively small and vary across zones. In the highlands, the maturity profile of seed sold falls by 11 days when the forecast is below-average and rises by 10 days when it is above-average, approximately 8% of the mean days to maturity under a normal forecast. Seed sales in the marginal and wet upper mid-altitude zone exhibit near-zero response to forecasts. This paper provides new evidence on the supply-side use of seasonal forecasts, highlighting the role of agro-dealers in facilitating short-run climate adaptation