AN EVALUATION OF RISK MANAGEMENT STRATEGIES FOR DAIRY FARMS

Darrell Bosch and Christian J. Johnson

Southern Journal of Agricultural Economics, 1992, vol. 24, issue 2, 10

Abstract: Variability in feed prices and crop yields are important sources of risk to dairy farmers. A simulation model of a representative dairy farm was used to evaluate crop insurance and hedging as risk management strategies. These strategies lowered expected net returns but also reduced risk. The preferred set of strategies at lower levels of risk aversion included hedging and crop insurance, although a base scenario in which no risk management strategies were employed was also efficient. The preferred strategy at higher levels of risk aversion was a combination of crop insurance and hedging.

Keywords: Livestock Production/Industries; Risk and Uncertainty (search for similar items in EconPapers)
Date: 1992
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: An Evaluation of Risk Management Strategies for Dairy Farms (1992)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:sojoae:29638

DOI: 10.22004/ag.econ.29638

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