A stochastic simulation model is used to simulate crop revenues net of farm policy and crop insurance costs. Certainty equivalent analysis is used to rank farm policy and crop insurance alternatives for varying levels of risk aversion.

Soybean production in the South has evolved over recent years from conventional soybean production systems (CSPS) in which soybeans are planted after May 1st to early soybean production systems (ESPS) in which soybeans are planted as early as mid-March. The shift was aided by the advent of...

This study uses farm-level data from a university feed-out program to evaluate how the value of feeder cattle ultimately realized through finishing and grid pricing differs from their market value at public auction. Results indicate that uncertainty related to feedlot performance, final carcass...

The reluctance to adopt value-based pricing stems from a fundamental problem created by the system: increased revenue uncertainty and variability. The literature suggests that inconsistent carcass characteristics cause revenue variability under grid pricing. The possibility that the grid pricing...

Optimal hedge ratios are estimated for various weights of feeder cattle in four cash markets based on CME data from 1992 to 1999. Three-month uniform hedges are simulated for every weight, contract, and cash market combination. Hedging effectiveness is compared empirically across locations to...

Experimental markets were used to isolate the effects of market structure and contract design on market outcomes. Preliminary results suggest that market structure drives outcomes, and not necessarily contract design. Future research will replicate experiments and add dimensions of market...

Stochastic simulation of daily slaughter level was used in conjunction with estimated packing plant cost curves to assess potential reductions in processing costs due to improved vertical coordination between feedlots and packing plants. Results indicate that processing cost reductions of $1 to...

Recent spikes in commodity prices have led to higher margin amounts and option premiums. For the most part, producers have always attributed their lack of use in reducing risk via futures and options markets to the high cost associated with the use of these markets. This study determines the...