Decoupling and prices: determinant of dairy farmers’ choices?

Baptiste Lelyon, Vincent Chatelier and Karine Daniel

Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement (RAEStud), 2011, vol. 92, issue 01

Abstract: In this paper, we discuss the cross-effects on the productive strategy of French dairy farms due to the decoupling and to price variation. A model based on mathematical programming has been developed to determine how dairy farmers might re-evaluate their systems to identify an optimal production plan. The model is applied to four types of dairy farms in order to analyze the impact of the reform depending on farm’s activities. The simulations point out how the implementation of the decoupling encourages farmers to increase the share of grassland. However, the increase in cereal prices is a strong incentive to intensify forage production to free up land for crop production. Finally, after four years of decoupling, this study helps to put into perspective the theoretical effects of decoupling and the actual choices made by farmers. This article identifies six factors which could explain these differences: the long-term production requirements, the eligibility criteria for the direct payment, the sociology/psychology of the farmer, the anticipation of a new reform, the trade organization and the value of property assets.

Keywords: Agricultural and Food Policy; Demand and Price Analysis; Livestock Production/Industries (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Decoupling and prices: determinant of dairy farmers’ choices? (2011)
Working Paper: Decoupling and prices: determinant of dairy farmers’ choices? (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:frraes:189339

DOI: 10.22004/ag.econ.189339

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