Income risk management in agriculture.
Contributors: Organisation for Economic Co-operation and Development.; OECD Workshop on Income Risk Management (2000 : Paris, France)
Series: Agriculture and food
Publisher: Organisation for Economic Co-operation and Development
Published: 2000
Place of publication: Paris
Language: eng
Number of pages: 150
Subjects: Agriculture -- Finance -- Congresses; Agriculture -- Economic aspects -- Congresses; Farm income -- Congresses; Farm risks -- Congresses; Insurance, Agricultural -- Congresses; Agriculture and state -- Congresses
Genres: Congresses.
Description: Various risks affect the income and the welfare of farm households. A large number of strategies are available to deal specifically with income risk. They exist against a general background of widespread government intervention that modifies the risks faced by farmers. In the context of agricultural policy reform, a challenge for policy makers is to better define the role of public policy versus market-based mechanisms to deal with income risk in agriculture. The OECD workshop examined the various strategies used by farm households, in particular those attracting renewed interest such as diversification of income sources, vertical co-ordination, hedging on futures markets, insurance coverage and public safety-nets. It allowed participants from Member countries’ governments and private industries to share their experience. One of the main conclusions was that farmers, as managers, have the primary responsibility for risk management and that the optimal mix of tools and instruments depends on specific conditions. Government intervention in risk management, coming as a response to an identified market failure, should be in line with general reform principles shared by OECD Ministers for Agriculture, which include increasing the market orientation of agriculture and addressing legitimate domestic interests in ways that do not distort production and trade.
Notes: Includes bibliographical references.
Papers presented at the OECD Workshop on Income Risk Management held in Paris on May 15-16, 2000.