Revenue volatility faced by Australian wheat farmers
This paper uses variance decomposition modelling to explore how wheat revenue volatility in Australia has changed spatially and temporally. The components of revenue variance are the variances and covariances of wheat prices, the area of wheat harvested and the yield of wheat. The key finding is that the volatility of wheat revenue (detrended) has more than doubled in every main wheat-growing State in Australia over the last 15 years or so Changes in wheat areas are mostly a minor source of revenue variance. The principal cause of volatility is yield changes with price changes increasing slightly in absolute importance when compared to their adjacent previous period. Greater downside yield risk is often the principal cause of the increased yield variance. The implications are that revenue variance, and especially downside revenue risk, has posed major problems for wheat-dominant farm businesses over the last 15 years or so. How Australia’s wheat producers have managed this greater volatility of wheat revenue is likely to have greatly affected the viability of their farm businesses.
|Date of creation:||2011|
|Contact details of provider:|| Postal: AARES Central Office Manager, Crawford School of Public Policy, ANU, Canberra ACT 0200|
Phone: 0409 032 338
Web page: http://www.aares.info/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Anderson, Kym & Martin, William J., 2007.
"Distortions to Agricultural Incentives in Asia,"
Agricultural Distortions Working Paper
48557, World Bank.
- John C. Quiggin & Jock R. Anderson, 1979.
"Stabilisation And Risk Reduction In Australian Agriculture,"
Australian Journal of Agricultural and Resource Economics,
Australian Agricultural and Resource Economics Society, vol. 23(3), pages 191-206, December.
- Quiggin, John C. & Anderson, Jock R., 1979. "Stabilisation And Risk Reduction In Australian Agriculture," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 23(03), December.
- von Braun, Joachim & Torero, Maximo, 2009. "Exploring the Price Spike," Choices, Agricultural and Applied Economics Association, vol. 24(1).
When requesting a correction, please mention this item's handle: RePEc:ags:aare11:100572. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.