IDEAS home Printed from https://ideas.repec.org/p/ags/cudawp/127012.html
   My bibliography  Save this paper

Quantifying Sources of Dairy Farm Business Risk and Implications for Risk Management Strategies

Author

Listed:
  • Chang, Hung-Hao
  • Schmit, Todd M.
  • Boisvert, Richard N.
  • Tauer, Loren W.

Abstract

Major sources of variability in net farm income on New York dairy farms over the past 10 years are identified using variance decomposition methods. The most important source of income variability is the fluctuation in milk prices, followed closely by year-to-year variation in the quantity of purchased feeds. The degree of success in engaging in activities that increase diversification and lead to variance reductions in farm income are higher for older farmers and for those that utilize milking parlors, use recombinant bovine somatotropin, have greater assets per cow, and have engaged in activities to earn income from off-farm sources.

Suggested Citation

  • Chang, Hung-Hao & Schmit, Todd M. & Boisvert, Richard N. & Tauer, Loren W., 2007. "Quantifying Sources of Dairy Farm Business Risk and Implications for Risk Management Strategies," Working Papers 127012, Cornell University, Department of Applied Economics and Management.
    • Handle: RePEc:ags:cudawp:127012
    DOI: 10.22004/ag.econ.127012
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/127012/files/Cornell_Dyson_wp0711.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.127012?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Knoblauch, Wayne A. & Putnam, Linda D., 2005. "Dairy Farm Business Summary, New York Dairy Farm Renters, 2004," EB Series 122045, Cornell University, Department of Applied Economics and Management.
    2. Knoblauch, Wayne A. & Putnam, Linda D. & Karszes, Jason, 2005. "Business Summary New York State 2004," Research Bulletins 122088, Cornell University, Department of Applied Economics and Management.
    3. Boisvert, Richard N. & McCarl, Bruce, 1990. "Agricultural Risk Modeling Using Mathematical Programming," Research Bulletins 183294, Cornell University, Department of Applied Economics and Management.
    4. Dismukes, Robert & Durst, Ron L., 2006. "Whole-Farm Approaches to a Safety Net," Economic Information Bulletin 33893, United States Department of Agriculture, Economic Research Service.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. El Benni, Nadja & Finger, Robert, 2014. "Where is the risk? Price, yield and cost risk in Swiss crop production," Revue d'Etudes en Agriculture et Environnement, Editions NecPlus, vol. 95(03), pages 299-326, September.
    2. Schmit, Todd M. & Chang, Hung-Hao & Boisvert, Richard N. & Tauer, Loren W., 2007. "Quantifying the Contributions to Dairy Farm Business Risk: Implications for Producer's Risk Management Strategies," EB Series 121879, Cornell University, Department of Applied Economics and Management.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Loren W. Tauer, 2009. "Estimation of Treatment Effects of Recombinant Bovine Somatotropin Using Matching Samples," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 31(3), pages 411-423.
    2. Schmit, Todd M. & Chang, Hung-Hao & Boisvert, Richard N. & Tauer, Loren W., 2007. "Quantifying the Contributions to Dairy Farm Business Risk: Implications for Producer's Risk Management Strategies," EB Series 121879, Cornell University, Department of Applied Economics and Management.
    3. Nicholson, Charles F. & Stephenson, Mark W., 2006. "Financial Performance and Other Characteristics of On-Farm Dairy Processing Enterprises in New York, Vermont and Wisconsin," Research Bulletins 121583, Cornell University, Department of Applied Economics and Management.
    4. Chang, Hung-Hao & Boisvert, Richard N. & Tauer, Loren W., 2007. "PR - Quantifying The Sources Of Dairy Farm Business Risk And Understanding The Implications For Risk Management Strategies," 16th Congress, Cork, Ireland, July 15-20, 2007 345363, International Farm Management Association.
    5. Alvarez, Antonio & del Corral, Julio & Tauer, Loren W., 2012. "Modeling Unobserved Heterogeneity in New York Dairy Farms: One-Stage versus Two-Stage Models," Agricultural and Resource Economics Review, Cambridge University Press, vol. 41(3), pages 275-285, December.
    6. Unterschultz, James R., 2000. "New Instruments For Co-Ordination And Risk Sharing Within The Canadian Beef Industry," Project Report Series 24046, University of Alberta, Department of Resource Economics and Environmental Sociology.
    7. Suter, Jordan F. & Vossler, Christian A. & Poe, Gregory L., 2009. "Ambient-based pollution mechanisms: A comparison of homogeneous and heterogeneous groups of emitters," Ecological Economics, Elsevier, vol. 68(6), pages 1883-1892, April.
    8. Lambert, David K. & McCarl, Bruce A. & He, Quifen & Kaylen, Michael S. & Rosenthal, Wesley & Chang, Ching-Cheng & Nayda, W.I., 1995. "Uncertain Yields In Sectoral Welfare Analysis: An Application To Global Warming," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 27(2), pages 1-14, December.
    9. -, 2009. "The outlook for agriculture and rural development in the Americas: a perspective on Latin America and the Caribbean, 2009," Coediciones, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 1379 edited by Iica.
    10. Georgina Belem Carrasco Galvan & Jacqueline M. Vadjunec & Todd D. Fagin, 2024. "Lessons from the Archives: Understanding Historical Agricultural Change in the Southern Great Plains," Land, MDPI, vol. 13(2), pages 1-31, February.
    11. Ford, Stephen A. & Ford, Beth Pride & Spreen, Thomas H., 1995. "Evaluation Of Alternative Risk Specifications In Farm Programming Models," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 24(01), pages 1-11, April.
    12. Coffey, Brian K. & Skees, Jerry R. & Dillon, Carl R. & Anderson, John D., 2001. "Potential Effects Of Subsidized Livestock Insurance On Livestock Production," 2001 Annual meeting, August 5-8, Chicago, IL 20606, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    13. Williams, Jeffery R. & Saffert, Andrew T. & Barnaby, G. Art & Llewelyn, Richard V. & Langemeier, Michael R., 2014. "A Risk Analysis of Adjusted Gross Revenue-Lite on Beef Farms," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 46(2), pages 227-244, May.
    14. Musser, Wesley N., 1994. "Progress In Risk Analysis In Regional Projects," 1994 Quantifying Long Run Agricultural Risks and Evaluating Farmer Responses Risk, Technical Committee Meeting, March 24-26, 1994, Gulf Shores State Park, Alabama 271553, Regional Research Projects > S-232: Quantifying Long Run Agricultural Risks and Evaluating Farmer Responses to Risk.
    15. Neyhard, James & Tauer, Loren & Gloy, Brent, 2013. "Analysis of Price Risk Management Strategies in Dairy Farming Using Whole-Farm Simulations," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 45(2), pages 1-15, May.
    16. Bahrs, Enno & Blanck, Niklas, 2009. "Die Risikoausgleichsrücklage als Instrument des landwirtschaftlichen Risikomanagements," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 58(04), pages 1-9, May.
    17. Völker, Marc & Tongruksawattana, Songporne & Hardeweg, Bernd & Waibel, Hermann, 2011. "Climate risk perception and ex-ante mitigation strategies of rural households in Thailand and Vietnam," Proceedings of the German Development Economics Conference, Berlin 2011 79, Verein für Socialpolitik, Research Committee Development Economics.
    18. M.M. Venter & D.B. Strydom & B. Grové, 2013. "Stochastic efficiency analysis of alternative basic grain marketing strategies," Agrekon, Taylor & Francis Journals, vol. 52(sup1), pages 46-63, March.
    19. Enahoro, D. & Schmit, T.M. & Boisvert, R.N., 2016. "Assessment Of New York’S Pollution Discharge Elimination Permits For Cafo’S: A Regional Analysis," Working Papers 250026, Cornell University, Department of Applied Economics and Management.
    20. Evers, A. J. M. & Elliott, R. L. & Stevens, E. W., 1998. "Integrated decision making for reservoir, irrigation, and crop management," Agricultural Systems, Elsevier, vol. 58(4), pages 529-554, December.

    More about this item

    Keywords

    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:cudawp:127012. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/dacorus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.