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Risk Management in Agriculture in Canada

Author

Listed:
  • Jesús Antón

    (OECD)

  • Shingo Kimura

    (OECD)

  • Roger Martini

    (OECD)

Abstract

This report analyses the agricultural risk management system in Canada, applying a holistic approach that considers the interactions between all sources of risk, farmers‘ strategies and policies. The policy analysis is structured around three layers of risk that require a differentiated policy response: normal (frequent) risks that should be retained by the farmer, marketable intermediate risks that can be transferred through market tools, and catastrophic risk that requires government assistance. The main policy issue in this report is the definition of the boundaries of these different layers. In Canada the system is overcrowded with policies and unable to signal risk layers in which farmers should take their own responsibility of management. Policies include AgriInvest, AgriInsurance, AgriStability, AgriRecovery and ad hoc measures. The analysis of AgriStability provides insights about the economics of agricultural income stabilization policies.

Suggested Citation

  • Jesús Antón & Shingo Kimura & Roger Martini, 2011. "Risk Management in Agriculture in Canada," OECD Food, Agriculture and Fisheries Papers 40, OECD Publishing.
    • Handle: RePEc:oec:agraaa:40-en
    DOI: 10.1787/5kgj0d6189wg-en
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    Citations

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    Cited by:

    1. Tangermann, Stefan, 2011. "Risk Management in Agriculture and the Future of the EU's Common Agricultural Policy," National Policies, Trade and Sustainable Development 320171, International Centre for Trade and Sustainable Development (ICTSD).
    2. Glauber, Joseph W., 2015. "Agricultural insurance and the World Trade Organization:," IFPRI discussion papers 1473, International Food Policy Research Institute (IFPRI).
    3. Peter Slade, 2021. "The impact of price hedging on subsidized insurance: Evidence from Canada," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 69(4), pages 447-464, December.
    4. Ching-Hsien Ho & Huu-Sheng Lur & Ming-Hwi Yao & Fang-Ching Liao & Ying-Ting Lin & Nobuyuki Yagi & Hsueh-Jung Lu, 2018. "The impact on food security and future adaptation under climate variation: a case study of Taiwan’s agriculture and fisheries," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 23(3), pages 311-347, March.
    5. Peter Slade, 2020. "Business risk management programs under review," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 68(3), pages 263-270, September.
    6. Kimura, Shingo & Anton, Jesus, 2011. "Farm Income Stabilization and Risk Management: Some Lessons from AgriStability Program in Canada," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114755, European Association of Agricultural Economists.
    7. Glauber, Joseph W., 2017. "Agricultural insurance and the WTO:," IFPRI book chapters, in: Bouët, Antoine & Laborde Debucquet, David (ed.), Agriculture, development, and the global trading system: 2000– 2015, chapter 10, International Food Policy Research Institute (IFPRI).
    8. Bizikova, Livia & Larkin, Patricia & Mitchell, Scott & Waldick, Ruth, 2019. "An indicator set to track resilience to climate change in agriculture: A policy-maker’s perspective," Land Use Policy, Elsevier, vol. 82(C), pages 444-456.
    9. Soliwoda, Michał & Kulawik, Jacek & Góral, Justyna, 2016. "Stabilizacja dochodów rolniczych. Perspektywa międzynarodowa, Unii Europejskiej i Polski," Village and Agriculture (Wieś i Rolnictwo), Polish Academy of Sciences (IRWiR PAN), Institute of Rural and Agricultural Development, vol. 3(172), January.
    10. Sarker, Rakhal, 2021. "Farm Safety Net Payments and Risk Balancing in Ontario Beef Sector," 2021 Conference, August 17-31, 2021, Virtual 315321, International Association of Agricultural Economists.
    11. Bahareh Mosadegh Sedghy & Rémy Lambert & Lota Dabio Tamini, 2016. "Supply response of corn farmers in Quebec: Analyzing the impact of prices volatility?," Cahiers de recherche CREATE 2016-1, CREATE.
    12. Kovačević, Vlado & Jeločnik, Marko, 2019. "Development of risk management instruments in the EU," Problems of Agricultural Economics / Zagadnienia Ekonomiki Rolnej 309063, Institute of Agricultural and Food Economics - National Research Institute (IAFE-NRI).
    13. Kovačević, Vlado & Jeločnik, Marko, 2019. "Development of risk management instruments in the EU," Rural Areas and Development, European Rural Development Network (ERDN), vol. 16.
    14. Pigeon, Mathieu & Henry de Frahan, Bruno & Denuit, Michel, 2012. "Evaluation of the EU proposed Farm Income Stabilisation Tool," LIDAM Discussion Papers ISBA 2012026, Université catholique de Louvain, Institute of Statistics, Biostatistics and Actuarial Sciences (ISBA).
    15. Pigeon, Mathieu & Frahan, Bruno Henry de & Denuit, Michel, 2012. "Actuarial evaluation of the EU proposed farm income stabilisation tool," 123rd Seminar, February 23-24, 2012, Dublin, Ireland 122485, European Association of Agricultural Economists.
    16. Ning An & Paul J. Thomassin, 2016. "The Economic Impact of Climate Change on Cash Crop Farms in Québec and Ontario," CIRANO Working Papers 2016s-31, CIRANO.
    17. Osuji, E.E & N.C. Ehirim & M.A.Y Rahji & T.T. Awoyemi & K.K. Salman & M.A.C.A Odii & S.C. Onyemuwa & Ibeagwa, O.B & C. Chikezie & M.O. Okwara, 2017. "Farming Risks and Security Challenges in Vegetable Production in Orlu, Imo State," Asian Development Policy Review, Asian Economic and Social Society, vol. 5(1), pages 37-42, March.
    18. Rakhal Sarker & Truc Phan & Yu Na Lee & Alfons Weersink, 2022. "Business Risk Management Program and risk‐balancing in Ontario hog sector: An empirical analysis," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 70(4), pages 287-304, December.
    19. Kimura, Shingo & Anton, Jesus & Cattaneo, Andrea, 2012. "Effective Risk Management Policy choices under Climate Change: An Application to Saskatchewan Crop Sector," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126736, International Association of Agricultural Economists.
    20. Pigeon, Mathieu & Henry de Frahan, Bruno & Denuit, Michel, 2014. "Evaluation of the EU Proposed Farm Income Stabilisation Tool by Skew Normal Linear Mixed Models," LIDAM Discussion Papers ISBA 2014003, Université catholique de Louvain, Institute of Statistics, Biostatistics and Actuarial Sciences (ISBA).
    21. Mosadegh Sedghy, Bahareh & Tamini, Lota Dabio & Lambert, Remy, 2018. "Effects of Price Insurance Programs on Supply Response: A Case Study of Corn Farmers in Quebec," MPRA Paper 93816, University Library of Munich, Germany, revised 30 Nov 2018.
    22. Poon, Kenneth, 2013. "Risky Business: Factors Affecting Participation Rate of AgriStability," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150978, Agricultural and Applied Economics Association.
    23. Liesivaara, Petri & Myyra, Sami & Jaakkola, Antti, 2012. "Feasibility of the Income Stabilisation Tool in Finland," 123rd Seminar, February 23-24, 2012, Dublin, Ireland 122537, European Association of Agricultural Economists.

    More about this item

    Keywords

    agricultural policy; catastrophic risk income stabilization; insurance; montecarlo simulations; policy targeting; risk-management;
    All these keywords.

    JEL classification:

    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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