Analyzing Crop Revenue Safety Net Program Alternatives and Implications on Marketing Decisions

摘要

This study evaluates the crop revenue effects of combining federal farm income safety net programs, crop insurance policies, and marketing arrangements. Eight representative farms across Nebraska are used to stochastically simulate the financial impact of nine risk management strategies to determine the optimal outcome during the 2011 production year. Results indicate that, out of the set of predefined strategies, the portfolio combination involving the government program choice of the Direct and Counter-Cyclical Program, crop revenue insurance with the fall harvest option, and hedging for the simulated time period provides the optimal outcome across the majority of representative farm scenarios.