FEASIBILITY OF INCOME INSURANCE IN EUROPEAN AGRICULTURE

Liberalization of agricultural markets leads to new risks for European farmers. This paper studies the feasibility of income insurance schemes for European crop and livestock farmers. Different insurance topics, such as governmental reinsurance and the use of mutual insurance funds, are described and analyzed, using individual farm level data of different areas and commodities. In this paper it is argued that 'income' insurance in European agriculture should be restricted to yield-only insurance schemes that are organized per commodity and per region and in which governments play the role of 'lender of last resort.Income variability, income insurance, crop and livestock farming, Risk and Uncertainty,

Trade-offs Between Consumer Concerns: An Application for Pork Production

This paper studies multiple attributes of pork production and analyses the trade-offs that consumers make between them. Results show that without considering the trade-offs, animal welfare and food safety are on average perceived as the most important attributes. However, including trade-offs, Taste and Price become major concerns. Conclusions are nuanced as for a number of segments and specific trade-offs Taste and Price are relatively less important. Results support the implementation of differentiated chain designs with distinct and innovative decisions for trade-offs to be made.Customised conjoint analysis, Segmentation, Pork production, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety,

PERCEPTIONS OF RISKS AND RISK MANAGEMENT STRATEGIES; AN ANALYSIS OF DUTCH LIVESTOCK FARMERS

The risk environment of farmers is changing and new risk management strategies are being introduced. Beal (1996) stated that risk management strategies adopted by farmers will be in accordance with their personal preferences for risk. In this context it would be useful for developers and sellers of new risk management strategies to have insight into farmers' preferences for risk. This paper studies to what extent such preferences are farmer-specific or whether general relationships exist. By means of a large questionnaire survey among 2700 livestock farmers in the Netherlands we gathered data on four groups of variables, i.e. socioeconomic characteristics of the farm, farmers' attitudes towards risk, their perceptions of sources of risk, and their perceptions of risk management strategies. Various techniques of multivariate data analyses have been used to analyse the relationships between these groups of variables. Many significant relationships were found (although not to a great extent for attitudes towards risk). However, we are cautious in recommending that new risk management strategies need to be fully fine-tuned to aspects analysed in this study. Low values of the adjusted R-squared indicate that there are still other (possibly even more personal) aspects that determine the final perception of a farmer of a risk management instrument. In addition, results of this study reflect farmers' perceptions of risk management strategies, which is not necessarily the same as the extent to which they would actually use such strategies.perception, sources of risk, risk management strategies, attitude towards risk, questionnaire survey, livestock farming, The Netherlands, Livestock Production/Industries, Risk and Uncertainty,

Costs of Producing Biogas at Dairy Farms in The Netherlands

By 2020, Dutch dairy chains envisage to be self‐sufficient with regard to energy used by dairy farms and dairy processors. This would require dairy farms to produce 25 PJ per year, possibly by a combination of wind, solar and biogas. This paper focuses on biogas. To evaluate the project’s viability we estimated the expected technical and financial performance of 4 types of business models, i.e. “CHP‐farm”, “CHP‐large”, “green gas” and “central upgrading of green gas”. Data stem from among others 23 biogas plants in the Netherlands. Anticipating that CHPmodels and green gas models occur with a likelihood of 40% and 60% respectively, the total number of biogas plants would amount to 232 (1% of dairy farms), including a total of 5 million tons of manure per year (14% of all cattle manure in the Netherlands) and annual government subsidies of Euro 295 million. Aggregated annual profits are expected to be positive, but over the project’s total life time there is an expected deficit of Euro 262. For this to change costs of feedstocks or digestate disposal costs would for instance have to go down. Also fully switching to green gas models dampens the deficit. Results are used in current stakeholders debates on the organization of an “energy neutral dairy chain” in the Netherlands. Further analyses incorporating uncertainty around key technical and economic parameters including financial impacts of CO2‐reductions are underway.green electricity, green gas, empirical data, technical performance, financial performance, Production Economics, Research and Development/Tech Change/Emerging Technologies,

The role of social capital in adoption of risky versus less risky subsidized input supplies:An empirical study of cocoa farmers in Ghana

This study evaluates the effect of social capital on farmers’ adoption of subsidized seedlings and fertilizer for cocoa farmers in Ghana. We distinguish three types of social capital: network social capital, relationship social capital, and community social capital. Network social capital refers to the peer-to-peer information flow about product benefits reaching farmers, therefore closing the information asymmetry that prevents farmers from social learning about crop risk management through inputs adoption. Relationship social capital considers the role of social status in getting facilitated access to inputs through connections with extension officers who facilitate information dissemination about input benefits, and moreover potentially help bypass the government criteria in getting access to inputs themselves. Finally, community social capital concerns the community collective income, community size and reachability relative to the cooperative main office. We find that network social capital has a significant effect on adoption of subsidized seedlings, to an extent where it allows farmers to bypass subsidy qualification criteria for access to seedlings imposed by the government. This applies even more so for group and village leaders. Subsidized fertilizer uptake, on the other hand, is less dependent on social capital. We argue that this difference results from the risk involved in adopting seedlings versus fertilizer. In the case of seedlings adoption, relying on information provided by the social network promotes sharing of benefits of hybrid varieties, and thus reduces the risk of its application. Adoption of fertilizer, on the other hand, is not correlated with social capital because fertilizer application is less risky to farmers. They can easily switch from using fertilizer to not using fertilizer. Access to both inputs is influenced by government inputs’ eligibility criteria, namely having mapped farm. However, we find that 15% and 29% of farmers respectively have access to seedlings and fertilizer, even though their farms are not mapped. Our findings suggest that for governments to stimulate uptake of substantive inputs, such as seedlings, subsidies should coincide with attention to social capital and fair distribution of inputs.</p

Gross margin insurance on Dutch dairy and fattening pig farms

Fluctuations of input and output prices are major reasons causing volatile gross margins in livestock production. There are large historic differences in the period 2001-2015 between the dairy sector and fattening pig sector in volatility. Relatively large fluctuations in gross margins were observed in the fattening pig sector (median coefficient of variation (CV) value of 32%). In the dairy sector gross margin between years was more smooth (median CV values of 12%), but projections are that after the gradual reduction of EU milk price support and following the abolishment of the EU milk quota system dairy farmers will become more exposed to the world market for dairy products and are becoming more vulnerable to (supply and demand) shocks affecting world dairy markets and prices

TRACEABILITY AND CERTIFICATION IN MEAT SUPPLY CHAINS

Food safety problems such as the BSE and dioxin crises focused attention on traceability systems and the certification of such systems. This study analyzes the status and perspectives of traceability systems and certification schemes, and reviews their potential costs and benefits. Results indicate that traceability and certification in meat supply chains comprise a very dynamic area with an increasing impact. Necessary transparency, control of livestock epidemics, increasing due diligence, and a declining role for governments are critical factors. Findings also reveal there is a general focus on the technical characteristics of traceability and certification, and there is a lack of economic considerations. Therefore, specific topics are emphasized for an economic research agenda, such as an analysis of the break-even point for the level of detail of traceability systems, the reconsideration of liability and recall insurance schemes, and regulatory incentives to motivate adoption by free-riders.certification, cost-benefit analysis, livestock production, supply chain, traceability, Industrial Organization, Livestock Production/Industries,

Food supply chain consequences of new responses to livestock epidemics

This article studies supply chain consequences from applying the new-more socially acceptable -strategy of emergency vaccination instead of the large-scale killing of healthy animals for controlling livestock epidemics. We consider an outbreak of foot and mouth disease in a densely populated livestock area of the Netherlands. From an epidemiological perspective, simulation results show that emergency vaccination significantly reduces the size of an epidemic, both in terms of the length of an outbreak and in the number of animals killed. However, in a worst-case situation, not destroying the vaccinated animals after the end of the epidemic leads to additional consequential losses for food supply chains involved of about Euro 200 million. A business case illustrates that the exact size of these losses depends on specific supply volumes and marketing strategies. Calculations provide a basis for addressing cost sharing issues and loss reducing opportunities of new responses to livestock epidemics.livestock epidemics, financial impact, consumer acceptance, Food Consumption/Nutrition/Food Safety,

Conceptual Framework for Extended Life Cycle Assessment of Soy and Beef Chains

debate on appropriate framework, tools and methods to evaluate food and feed along the chains. This paper presents literature review for evaluation of triple bottom line impacts of soy and beef chains in particular, and food chains in general. We reviewed literature on the sustainability of soy and beef chains and concluded that synchronous quantitative assessment of triple bottom line impacts along the soy and beef chains is currently lacking. We proposed to define a framework to bridge the gap between concepts of sustainability and carry out economic, environmental and social evaluation of food business cases especially for soy and beef chains. The framework includes defining relevant triple bottom line indicators, stakeholder preferences and defining quantitative methods for assessment of these impacts simultaneously. However, this paper is still under development and defining framework has been partly done. Moreover, stakeholders’ preferences have not been finished yet

Consumers' Perception of Milk Safety

Several times during the last decade consumers have been warned about different incidents concerning food safety, like, salmonella in eggs, cheese and poultry, and pesticides residues in tomatoes. The problem of food safety is still to be a largely latent concern for consumers. The main research goal of this paper is to investigate consumers' risk attitudes and risk perceptions concerning milk safety and to estimate their willingness to pay for extra-safe milk. The data was collected in the Netherlands using a mail survey. 211 usable questionnaires (26%) were returned. Results show that, in general, consumers are not concerned about the safety of milk. However, the results of consumers' perceptions of the "riskiness of milk contamination" for vulnerable groups of people show that babies are considered to be more sensitive to different sources of contamination than other groups. This study supports the results of previous food safety studies showed that consumers are willing to pay a price premium to the traditional purchase price to avoid some perceived risks. 58% of respondents are willing to pay an additional price for extra-safe milk. The conjoint experiment results indicate that the most important factors for consumers' preference are risk of contamination and presence of a label. Based on a conjoint analysis four segments of respondents were distinguished: "Balanced Shoppers"; "Safety-Seekers"; "Safety-Indifferent"; and "Extreme-Safety Seekers".food safety, questionnaire survey, risk attitudes, risk perceptions, willingness to pay, willingness to buy., Food Consumption/Nutrition/Food Safety,