The role of weather derivatives and portfolio effects in agricultural water management

05.08.2014 945 views Download :

Restrictive irrigation water policies established due to e.g. environmental concerns or water scarcity appear to result in declining farm income and arising risk exposure in terms of yield uncertainty. In order to mitigate the economic disadvantages caused by restrictive water and irrigation policies, farmers may reallocate the available irrigation water between crops, adjust the crop-specific irrigation intensity or alter crop portfolios to better balance risks.

The role of weather derivatives and portfolio effects in agricultural water management

05.08.2014 945 views

Restrictive irrigation water policies established due to e.g. environmental concerns or water scarcity appear to result in declining farm income and arising risk exposure in terms of yield uncertainty. In order to mitigate the economic disadvantages caused by restrictive water and irrigation policies, farmers may reallocate the available irrigation water between crops, adjust the crop-specific irrigation intensity or alter crop portfolios to better balance risks.