If you assess risks, one can get support from professionals such as bankers to aid in lowering risks. Insurance is a needed form of risk management. One can get crop and livestock insurance that fits the needs of the operation. It can protect income and pay for production costs. Diversification will lower risks.
Diversification is a traditional way of reducing income variability.
They combine dissimilar things. They include crops, livestock, different selling weights for your products, or new agricultural industries such as composting. As your SAE grows, diversification is a great safety net. Contract production is associated with vertical integration, where an agribusiness firm coordinates all aspects of the business from production to the consumer's table. This includes livestock production or ethanol production.