CROP INSURANCE UNDER QUALITY UNCERTAINTY

Quality related yield and price losses have had significant impact on producer income and risks, and in some instances exceeded yield and price losses covered by conventional insurance instruments. However, there are no effective third party quality risk transfer mechanisms especially for barley growers. In this paper, we develop a framework to incorporate quality-related risk in crop insurance programs. Specifically, we derive the optimum equilibrium coverage levels and risk premium that suppliers of insurance and producers would be willing to provide when the yield and revenue insurance instruments explicitly incorporate quality losses. The results of our analysis provide several important contributions. First, the methodology illustrates how quality impacts could be incorporated into crop insurance types of contracts. Second, we explicitly incorporate the correlation effects of yield and price shortfalls due to quality. Though applied here in the case of malting barley and scab, this approach could be applied similarly in many regions, crops, and quality factors.Risk and Uncertainty,

ECONOMIC IMPACT OF SCAB WITH ALTERNATIVE RISK MANAGEMENT STRATEGY: THE CASE OF CROP QUALITY INSURANCE IN BARLEY

Managing quality risks, especially grain quality, has been a challenge facing farmers, grain merchandisers, and policymakers for many years. With the advent of genetically modified organisms (GMOs), food safety, and identity preservation, this is even more challenging today. In this paper, an equilibrium crop insurance model was developed and used to analyze the impact of quality risks on equilibrium coverage levels and risk premiums that suppliers of insurance and barley producers would be willing to provide when yield and revenue insurance instruments explicitly incorporate quality risks. The asking price concept and sensitivity analysis were used to evaluate farmers' behavior after they purchase crop quality insurance and to provide guidance and direction in the development of risk-efficient quality insurance instruments.crop insurance, equilibrium coverage levels, Fusarium Head Blight, premium rates, quality risks, risk aversion, Crop Production/Industries,

VALUE-ADDED WHEAT PRODUCT TRADE

This study evaluated international trade of value-added wheat products. Analyzed were market size and growth rate by country for each product group. Shift share analysis was used to examine changes in market shares for each value-added wheat product group. Major international exporters were identified for each product group, and market shares held by the major exporters for specific importing markets were analyzed.Bakery, international trade, market size, market growth, shift-share analysis, market share, exports, value-added., International Relations/Trade,

Ecosystem-based Management for Protected Species in the North Pacific Fisheries

In the North Pacific Ocean, an ecosystem-based fishery management approach has been adopted. A significant objective of this approach is to reduce interactions between fishery-related activities and protected species. We review management measures developed by the North Pacific Fishery Management Council and the National Marine Fisheries Service to reduce effects of the groundfish fisheries off Alaska on marine mammals and seabirds, while continuing to provide economic opportunities for fishery participants. Direct measures have been taken to mitigate known fishery impacts, and precautionary measures have been taken for species with potential (but no documented) interactions with the groundfish fisheries. Area closures limit disturbance to marine mammals at rookeries and haulouts, protect sensitive benthic habitat, and reduce potential competition for prey resources. Temporal and spatial dispersion of catches reduce the localized impact of fishery removals. Seabird avoidance measures have been implemented through collaboration with fishery participants and have been highly successful in reducing seabird bycatch. Finally, a comprehensive observer monitoring program provides data on the location and extent of bycatch of marine mammals and seabirds. These measures provide managers with the flexibility to adapt to changes in the status of protected species and evolving conditions in the fisheries. This review should be useful to fishery managers as an example of an ecosystem-based approach to protected species management that is adaptive and accounts for multiple objectives

LOGISTICAL COSTS AND RISKS OF MARKETING GENETICALLY MODIFIED WHEAT

Genetically modified (GM) grains have increased in importance. Moving biotech grains from producers to processors is a challenge for the grain handling system that could involve increased segregations. The objective of this research is to determine how testing strategies affect the logistical costs of a grain pipeline when GM wheat is present. A logistical model was developed and simulated to analyze impacts of uncertainty in demand, receipts, test accuracy, rail deliveries, and transit time. Sensitivities were conducted on certain variables to determine their effects on logistical costs. Analysis revealed that logistical costs are impacted by the number of quality categories and uncertainties in the system. Adding GM grains increased costs due to testing requirements and increased segregation demands as the number of wheat categories rises.Genetically Modified (GM) Grains, Logistical Costs, Testing, Risk, Segregation, Crop Production/Industries, Research and Development/Tech Change/Emerging Technologies,

LOGISTICAL COSTS AND STRATEGIES FOR WHEAT SEGREGATION

Special segregations that provide unique qualities for end use products are being specified by buyers. As users of wheat become more specific about quality, the number of quality segregations that the logistical pipeline must accommodate increases. The additional cost of increased grain segregations will influence the optimal level of wheat variety segregations marketed in a supply chain. The primary objective of this research is to develop a model that captures the logistical costs of increased grain segregations in the marketing system. A simulation model was developed to add logistical uncertainty in demand, receipts, rail deliveries, and transit time. Sensitivities were conducted on certain variables to determine their effects on logistical costs. Logistical costs increase as more segregations are added. In addition, increasing uncertainty into the system raises logistical costs. Pipeline configuration also affects costs as the number of categories/storage bins present at origin may differ from the wheat categories demanded or the number of storage bins present at the export elevator.wheat, segregations, Crop Production/Industries,