Price Pooling and the Gains from Hedging: Application to a Swedish Grain Cooperative

D. Demcey Johnson, Tomas Nilsson and Hans Andersson

No 20554, 2001 Annual meeting, August 5-8, Chicago, IL from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: Optimal hedging strategies are analyzed for a cooperative operating a price pooling system in the presence of price and quantity risk. A three-period model, accounting for default risk and storage, is developed. Hedging allows the cooperative to increase the pool price offered to farmers by 2.8 - 4% for moderate risk parameters.

Keywords: Agribusiness; Marketing (search for similar items in EconPapers)
Pages: 19
Date: 2001
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea01:20554

DOI: 10.22004/ag.econ.20554

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