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The purpose of this paper is to propose a new margin protection (MP) scheme for the producers of hog, cattle and dairy in the developing countries.

The proposed MP scheme is inspired by the Livestock Gross Margin (LGM) program that has been successfully implemented in US directly implementing the LGM program in developing countries can be difficult due to the rudimentary of the futures market with limited futures listing. To address this issue, the authors proxy the futures prices by relating to some relevant spot prices via an econometric model. The proxied futures prices, in turn, enable the implementation of a generalized LGM, which the authors denote as the MP scheme.

As China is the world’s largest consumption and production of pork, the authors describe the proposed MP scheme by demonstrating how a generalized LGM can be constructed for the Chinese hog producers. By empirically comparing to the pilot hog price index insurance for the Beijing’s hog producers, the authors find that the proposed MP scheme is more effective in providing MP for the producers.

The proposed MP scheme still requires the availability of some relevant spot prices in order to use an econometric model to proxy the missing futures prices.

The value of this research stems from demonstrating how an MP scheme can be constructed for developing countries that have rudimentary futures markets.

This paper investigates Chinese agricultural insurance agents willingness to offer (WTO) livestock insurance based on the variations of eight main attributes of livestock insurance.

This study implements discrete choice experiments (DCE) with actual insurance agents who design, sell and operate livestock insurance in China. The choice experiment of this study is based on the D-optimal approach, a six-block design, with 15 cards per block and two choices per card. The sample size was 211. Econometrics results are based on conditional and mixed logit models.

The authors find that the subsidy effect is enormous; a one level increase of subsidy leads to 3.166 times higher probability to offer. This subsidy effect is important as it confirms the endogenous structure between price and quantity in insurance offering, where subsidy does not only incentivize demand but also the supply. Another main factor of insurance investigated is the impact of different coverage types on agents' WTO. The authors find that agents prefer mortality insurance the most, followed by revenue insurance and profit insurance, while Index-Based Livestock Insurance (IBLI) is the least preferred to offer. Agents' knowledge about these newer types of insurance supports their WTO as well; thus, proper education is necessary to promote the more advanced types of livestock insurance.

A limitation is that in the presence of COVID 19, and administrative issues at the local level, the sample was not randomly drawn. Nonetheless, the authors believe that there is enough diversity across participants, insurers and provinces and have done sufficient robustness checks to support results and conclusions.

This study provides further validation for the DCE research method that could potentially be applied to different analyses: using choice experiments to study insurers and reveal their preferences, through combinations of various levels of core attributes for insurance products. The findings and contribution are critical to the reform and improvement of livestock insurance in China and for insurance markets more broadly. The authors find that insurers do not place equal weights or values on insurance product attributes and do not view types of insurance equally. In other words, while farmers may hold different preferences about the type of insurance they demand, the results suggest that insurers also hold preferences in the type of insurance they sell.

So far as the authors are aware, this is the first DCE designed around the supply of insurance products with the subjects being insurance agents, marketers and executives.

After several reforms of the common agricultural policy, domestic product prices and farm incomes have become more volatile in the EU. Risk-averse farmers are therefore seeking income stabilizing measures. Margin insurance is among the feasible options but is not yet established in the EU. The purpose of this paper is to explore such an insurance under EU conditions for a major crop.

The paper explores conditions for a viable margin insurance. It presents a modeled-loss trigger for a margin insurance scheme using wheat production in Austria as the case study.

While margin insurance products are widely used in the USA, such products are not available in the EU. Basis risk seems to be an important reason. An exploration of wheat production in Austria shows that heterogeneity among farms is relevant. The authors demonstrate an approach aiming to lower basis risks.

This paper presents a technically feasible approach to handle the basis risk of a margin insurance under EU conditions. Before such a product can be placed on the market, further research on systemic risk is needed. Market research is necessary to fine-tune the details of the product to meet the actual demand of farmers. Further empirical validation of the modeled losses is needed. Legal implications are not explored in this paper.

The insurance product presented here demonstrates a concept that is established in the USA under EU conditions. It is motivated by several shortcomings of income risk mitigation approaches in the EU.

Income risk may be seen as a problem of social policy. The approach shows that it can be addressed by market-oriented instruments.

To the authors’ knowledge, this paper is the first to propose a tool to handle basis risk for margin insurance products in agriculture in the EU. A special feature of the proposed approach is that it is not limited to a single product such as wheat.

The purpose of this paper is to examine the sources and magnitude of variation in accrual adjusted gross farm revenue and farm revenue net of feed purchases on Michigan dairy farms representative of Upper Midwest dairy farms. The paper aims to assess whether adjusted gross revenue‐type insurance instruments meet insurability conditions when applied to dairy farms.

Accrual adjusted dairy farm revenue and revenue net of feed purchased from Michigan dairy farm panel data from 1995 through 2006 were detrended and summarized. Variance decomposition was used to identify sources of variation in adjusted gross revenue and adjusted gross revenue less feed purchases. In‐sample insurance premiums were estimated and Monte Carlo simulations were used to adjust these premiums for out‐of‐sample considerations.

Milk price variation was the largest source of variation while milk production per cow varied little. Farms with smaller herds and those with larger percentages of farm revenue from crop sales had higher relative revenue variability and would trigger a higher frequency of indemnities under a whole farm revenue insurance contract.

Because the data analyzed conclude in 2006, the volatility of the past couple of years is not reflected. Therefore, researchers are encouraged to test the proposed insurance feasibility further with more recent data.

The paper addresses considerations for the development and commercialization of a feasible dairy revenue insurance instrument.

This paper fulfils a need to understand magnitude and source of revenue variation on dairy farms and how insurance might mitigate negative consequences of this variation.

There is a great deal of interest in ecosystem or natural capital accounting and in methods to estimate monetary valuations of ecosystems. This paper aims to explore methods that may assist agricultural (livestock grazing) enterprises to estimate the monetary value of the productive capacity of the ecosystems they use. Such estimations are expected to provide a more complete set of information about the performance of pastoral operations and may assist them to assure ecological and economic sustainability.

This paper applies five different methods for valuation of the productive ecosystems used in extensive agricultural (grazing) systems. The methods apply different approaches to valuation described in the United Nations System of Environmental-Economic Accounting (SEEA) and Australian Accounting Standards (AASs). To do this, the paper uses financial information drawn from the long-term performance of an economically and environmentally sustainable pastoral enterprise.

SEEA- and AAS-compliant methods to measure the value in use of provisioning ecosystems are practical and useful. The estimations contribute to a reasonable range of fair values required by AASs and improve the availability of information that would be useful in improving the performance of the operation and compare it to reasonable alternate management strategies.

The SEEA is an international standard and AASs are closely aligned to the International Accounting Standards, so the methods described in this paper are likely to be generalisable to enterprises grazing low-rainfall rangelands in other countries. However, their ability to appropriately accommodate the extensive modifications to ecosystems caused by cultivation and fertilisation needs to be tested before they are applied to grazing operations in high-rainfall areas or other forms of agriculture such as cropping or horticulture.

The availability of standards-compliant methods for ecosystem valuation means that companies who wish to include ecosystems on a voluntary and informal basis as sub-classes of land in their general purpose financial reports may be able to do so. If these methods are SEEA-compliant, they could be combined with information about the ecosystem type, extent and condition to produce a set of national ecosystem accounts so that the contribution of ecosystems to the economy can be estimated.

Many of the enterprises that rely on extensive agricultural ecosystems are unable to generate sufficient financial returns to cover their obligations to owners and creditors. The ability to determine the monetary value of the annual inputs provided by the ecosystems may assist landowners and citizens to detect and avoid depletion of their economic and ecological resources.

This paper applies an explicit interpretation of AAS and draws from valuation methods recommended in the SEEA to demonstrate that current accounting standards (national and corporate) provide a strong foundation for the valuation of the ecosystems used as economically significant factors of production.

The purpose of this research is examine the development of livestock mortality insurance, and associated challenges, in order to provide an improved understanding regarding the operation of livestock mortality insurance.

In a many countries, livestock mortality insurance has been either unavailable or underdeveloped. A descriptive analysis is provided regarding the background and development of livestock mortality insurance, along with an example.

Livestock mortality insurance is considerably more complex than crop insurance, and some of the complexities of livestock mortality insurance include multi‐stage production, consequential losses, occasional large event losses, animal health management, moral hazard, and adverse selection.

This study provides background and development information regarding livestock mortality insurance, and also highlights a number of important differences between livestock mortality insurance and crop insurance.

The expected increase in milk price volatility after the milk quota abolition in the EU will lead to further planning uncertainty on dairy farms. Consequently, the modest supply of insurance and the hedging of milk prices through futures may increase. To shed more light on this possibility, the purpose of this paper is to calculate the additional willingness to pay (WTP) for risk-averse dairy farmers in order to cope with milk price volatility after the quota abolition.

After the European dairy quota abolition, European dairy farmers will be more dependent on the milk price of the world market. To reflect the world market, a time series of milk prices of a dairy processor from New Zealand (NZ) was used because NZ is exporting most of their dairy products under world market conditions. Based on the NZ price series, we approximated milk price volatility after the European dairy quota abolition and calculated the additional WTP of risk-averse dairy farmers in order to cope with milk price volatility.

Using a price series of NZ to approximate milk price volatility after the European dairy quota abolition and comparing it with a German milk price series before quota, the results suggest there might be increased WTP after the milk quota abolition in order to cope with milk price volatility. Following this assumption, the WTP of considerable risk-averse dairy farmers may exceed the initial transaction costs of hedging milk prices with futures on commodity exchanges. Nevertheless, a qualitative discussion of the results shows costs of education, basis risk, and the small size of farms could still keep dairy farmers from hedging the milk price.

In calculating the additional WTP for risk-averse dairy farmers to cope with milk price volatility, this is the first study to attempt to illustrate the expected influence of increasing milk price volatility at the dairy farm level after the dairy quota abolition in the EU. The additional WTP gives further insights into the need for and acceptance of insurance after the dairy quota abolition at the dairy farm level.

The purpose of this paper is to investigate the profitability of urban chicken production in the medium-sized cities of Kisumu and Thika, Kenya.

Data were collected in 2016 from a sample of 157 indigenous chicken producers in the two cities. Descriptive analyses were used to characterize indigenous chicken production, marketing and profitability. In addition, multivariate regression models were estimated to determine factors influencing profitability of the enterprise.

Urban indigenous chicken production mainly serves a dual role of food provision and income generation. The enterprise is profitable, generating an average gross margin of Ksh. 756/bird. The multivariate regression models show that access to high-value markets, household income level and the type of production system used significantly affect profitability of indigenous chicken farming. However, poultry diseases and high input costs especially feed are the major constraints to poultry farming.

This study has used cross-sectional data that provides information for only one point in time. Future research should be able to capture the seasonality of indigenous chicken production.

This study has shown that indigenous chicken production in urban areas is a viable and profitable enterprise, which could provide an avenue for employment and income generation.

Studies assessing profitability of urban agricultural enterprises are scant. Thus, this study provides insights on the profitability of a common urban agriculture enterprise.

The authors assess the development potential of cowpea beyond grain in local markets in Mali by: (1) identifying trader types and types of cowpea products sold; (2) examining trader roles; (3) estimating gross margins and their determinants; and (4) discussing policy opportunities to further develop the value chain.

The authors analyze data collected through observation and semi-structured questionnaires from 487 sellers in 26 markets, including market, seller, and product characteristics. The authors also calculate gross margins and conduct a regression analysis to identify influential factors.

The authors identify several types of cowpea sellers in local markets, including processor-retailers, retailers of fresh leaves and fodder, and grain retailers, collectors and wholesalers. Women dominate the marketing of processed products and fresh leaves. The marketing of boiled cowpeas offers retailers higher margin rates compared to fritters and pancakes. Grain sellers, who are mostly men, have lower margins but sell larger quantities. Processor-retailers bring more value to the cowpea value chain. Specialization of the seller in cowpea, regional location of the market and day of the market fair all influence gross margins.

Future work should explore consumer preferences for different types of cowpea products.

This study of the cowpea value chain in Mali has revealed the multidimensional character of the cowpea plant, which goes far beyond its grain and highlight the important roles played by women.

The nature of farm animals in the marginalized group of people is varying hurriedly. Livestock is used to add to cash earnings and increase food security, hence helping as a vital component in the household’s source of revenue strategies, particularly at marginal planter’s level. The present study was conducted to assess the numbers of livestock farmers in the study areas, their livelihood options, the value chain of the farmers in different marketing channels and recommendation for the sustainable value chain of the livestock production cycle.

The study precise the baseline condition of marginal livestock farmers for access to value chain activities in terms of inputs, outputs, support services, production, yield, income and enabling environment to enhance livestock farming in the study area. The study was conducted through stratified random sampling of the context using some research tools like in-depth interviews, household surveys, expert opinions and focus group discussions. Structured questionnaires were developed to address issues, such as current livestock farming practices, access to support services, capacity and income.

The study revealed that this particular context is lagging behind to establish goat value chain activities in the targeted areas. The farmers do not have basic knowledge of goat farming, and the value chain actors are not working properly. The support services are not appropriate to turn the goat farming production to a standard level. Value chain of livestock and livestock products and their goals are essential to develop an idea on learning, investment, market access, sales assurance and quality. Variation in institutional contexts of end markets is linked to different types of coordination and control of enabling environment throughout the chains.

Livestock is an integral component of the complex farming system in Bangladesh as it serves as not only a source of meat protein but also a major source of farm power services as well as employment. Strong private sector alliance along with public–private ventures can bring sustainable agriculture value chain development in these most vulnerable coastal communities in Bangladesh. Strengthening the weak financial structure, reducing power imbalances in the governance structures and low political intervention in community-level organizations, and resolving socio-cultural and environmental concerns are the major concerns on the development of value chains in Bangladesh.

Geographical position and climatic condition of Bangladesh have made her coastal areas one of the highly productive areas for livestock production in the world. The study was conducted through qualitative and quantitative analysis, and after finding the authors recommended for sustainable value chain approach for livestock production to a marketing channel for improving the financial condition and self-employment for the communities.