Assisting Whole-Farm Decision-Making through Stochastic Budgeting

Stochastic budgeting is used to simulate the business and financial risk and the performance over a six-year planning horizon on a Norwegian dairy farm. A major difficulty with stochastic whole-farm budgeting lies in identifying and measuring dependency relationships between stochastic variables. Some methods to account for these stochastic dependencies are illustrated. The financial feasibility of different investment and management strategies is evaluated. In contrast with earlier studies with stochastic farm budgeting, the option aspect is included in the analysis.Farm Management,

Illinois occultation summary, 1. 1977 - 1978

Instrumentation and data acquisition techniques used to record lunar occultations at the University of Illinois Prairie Observatory are described. Tables and graphs summarize data from 64 events which include 30 observations of stars brighter than 7th magnitude, 40 reappearances, 4 angular diameter measurements, 8 observations of binary stars, and 6 observations which may indicate multiplicity

Mathematical model for a radioactive marker in silicide formation

A mathematical model is constructed to interpret the profiles of radioactive (^31)Si tracers in a computer simulation proposed by R. Pretorius and A. P. Botha [Thin Solid Films 91, 99 (1982)]. This model assumes that only Si moves in the silicide, that the Si moves interstitially and convectively, and that the moving Si can exchange sites with the stationary Si in the silicide lattice. An analytical solution of this model is given and confirms the published computer simulation data. However, it is shown that the model is physically inadequate. Solutions of another model which assumes that metal, instead of Si, is the moving species for silicide formation (either interstitially, or substitutionally, or both), with self-diffusion of (^31)Si in the silicide during silicide formation. Almost all the experimental data can be fitted by solutions of both models. These examples demonstrate that radioactive tracer experiments alone are insufficient to determine the moving species when a solid binary compound film forms by reaction of adjacent elemental layers. Both inert marker and tracer data are needed to identify the moving species and the mechanisms

Stochastic Utility-Efficient Programming of Organic Dairy Farms

Opportunities to make sequential decisions and adjust activities as a season progresses and more information becomes available characterize the farm management process. In this paper, we present a discrete stochastic two-stage utility efficient programming model of organic dairy farms, which includes risk aversion in the decision maker's objective function as well as both embedded risk (stochastic programming with resource) and non-embedded risk (stochastic programming without recourse). Historical farm accountancy data and subjective judgments were combined to assess the nature of the uncertainty that affects the possible consequences of the decisions. The programming model was used within a stochastic dominance framework to examine optimal strategies in organic dairy systems in Norway.agriculture, risk analysis, stochastic programming, stochastic dominance, organic farming, Livestock Production/Industries, Q12, C61,

Term Structure of Volatility and Price Jumps in Agricultural Markets - Evidence from Option Data

Empirical evidence suggests that agricultural futures price movements have fat-tailed distributions and exhibit sudden and unexpected price jumps. There is also evidence that the volatility of futures prices contains a term structure depending on both calendar-time and time to maturity. This paper extends Bates (1991) jump-diffusion option pricing model by including both seasonal and maturity effects in volatility. An in-sample fit to market option prices on wheat futures shows that our model outperforms previous models considered in the literature. A numerical example illustrates the economic significance of our results for option valuation.Option pricing, Futures, Term structure of volatility, Jump-diffusion, Agricultural markets, Demand and Price Analysis,

Organic Dairy Farming in Norway Under the 100% Organically Produced Feed Requirement

The EU regulation governing organic production will require 100% organic feed in organic dairy systems from August 2005 compared with 85% currently in Norway. This study aimed to assess adjustments in resource use and financial impacts on organic dairy herds using a discrete stochastic programming model. Farm management effects of the regulatory change varied between farm types. For the two organic dairy systems examined, both having a milk quota of 100 000 litres but with varying farmland availability, the introduction of the 100% organic feed regulation resulted in an economic loss of approximately 6-8% of the net income compared to the current regime. The economic loss was mainly due to the considerable higher price of organic compared to conventional concentrates.feed regulation, organic farming, milk production, stochastic programming, Livestock Production/Industries,

Model for Anisotropic Directed Percolation

We propose a simulation model to study the properties of directed percolation in two-dimensional (2D) anisotropic random media. The degree of anisotropy in the model is given by the ratio $\mu$ between the axes of a semi-ellipse enclosing the bonds that promote percolation in one direction. At percolation, this simple model shows that the average number of bonds per site in 2D is an invariant equal to 2.8 independently of $\mu$. This result suggests that Sinai's theorem proposed originally for isotropic percolation is also valid for anisotropic directed percolation problems. The new invariant also yields a constant fractal dimension $D_{f} \sim 1.71$ for all $\mu$, which is the same value found in isotropic directed percolation (i.e., $\mu = 1$).Comment: RevTeX, 9 pages, 3 figures. To appear in Phys.Rev.

A Comparison of Risk Exposure in Aquaculture and Agricultural Businesses

Agriculture and aquaculture have common features associated with their biological nature affecting risk exposure of the businesses. The aim of this paper is to compare risk exposure in salmon farming and agricultural enterprises in Norway by using an implicit error component model to examine the risk structure of yields, prices and economic returns at the farm level. Results indicate a higher farm-level year-to-year variability in yields, prices and economic returns in salmon farming than in agricultural enterprises. The variability in livestock enterprises was generally lower than for crop enterprises. Return on assets was highest in salmon farming with an average annual return of 9.2%. All of the agricultural farm types exhibited a negative average return on assets on average. Stochastic dominance tests of the distribution of economic returns from aquaculture and agricultural farm types showed salmon farming to be the most risk efficient alternative and salmon farming was most attractive from an investor’s perspective.Risk analysis, variability, Norway, Risk and Uncertainty,