IMPROVING RISK MANAGEMENT TO ENHANCE THE COMPETITIVENESS OF FLORIDA AGRICULTURAL PRODUCERS AND AGRIBUSINESSES

• Sponsoring Institution: National Institute of Food and Agriculture
• Project Status: COMPLETE
• Funding Source: HATCH
• Reporting Frequency: Annual
• Accession No.: 0220957
• Project Start Date: Oct 1, 2009
• Project End Date: Sep 30, 2014
• Program Code: [(N/A)]- (N/A)

Recipient Organization
UNIVERSITY OF FLORIDA
G022 MCCARTY HALL
GAINESVILLE,FL 32611

Performing Department
Food and Resource Economics

Non Technical Summary
Florida is a leading agricultural state in the nation. Florida's agriculture is predominately specialty crops (70%) and livestock (20%). In addition, for many commodities, such as citrus, an extensive industry exists for the processing and marketing of the product. If Florida agriculture and agribusiness is to remain competitive in the face of increased risk from international competition and increased competition for land and water resources from urban growth there is a need to better understand the risk characteristics or risk structure of Florida agriculture. Information needs to be developed and analyzed that examines the demand for existing and potential risk management strategies that could be utilized by Florida agricultural producers and agribusiness to better manage risk to improve or stabilize profitability, and ensure long-term firm survival.

Animal Health Component

(N/A)

Research Effort Categories

Basic

(N/A)

Applied

(N/A)

Developmental

(N/A)

Classification

Knowledge Area (KA)	Subject of Investigation (SOI)	Field of Science (FOS)	Percent
601	3910	3010	10%
601	3910	3100	10%
602	2410	3010	10%
602	2410	3100	20%
602	3910	3010	10%
602	3910	3100	10%
601	2410	3010	10%
601	2410	3100	20%

Knowledge Area
601 - Economics of Agricultural Production and Farm Management; 602 - Business Management, Finance, and Taxation;

Subject Of Investigation
3910 - Cross-commodity research--multiple animal species; 2410 - Cross-commodity research--multiple crops;

Field Of Science
3010 - Economics; 3100 - Management;

Keywords

risk characteristics

risk structure

risk management

stochastic business models

simulation models

Goals / Objectives
Objective 1 - Develop representative farm and agribusiness databases for Florida. Objective 2 - Develop econometric and stochastic business models. Objective 3 - Use these models to examine alternative risk management strategies and alternative agricultural policy for their potential for enhancing the competitive position of Florida producers and agribusinesses. Objective 4 - Transmit this information to interested parties, including IFAS research and extension personnel, agribusiness professionals and actual producers.

Project Methods
The main purpose of this research is to develop a comprehensive risk management model that will fully assess the multi-year nature of crop and livestock production and allow for the examination and development of appropriate risk management strategies. This model will combine the physical/biological risk and market risk, with the financial situation of the operation, to examine multi-year risk management strategies. This model will also be developed to examine the risk associated agribusiness firms.

Progress 10/01/13 to 09/30/14

Outputs
Target Audience: Nothing Reported Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided? Attended the AAEA meetings to meet with fellow researchers How have the results been disseminated to communities of interest? Have networked with students and other faculty What do you plan to do during the next reporting period to accomplish the goals? THis is the last year for this project. Plan to seek approval on anoeher project to allow continued work in this area.

Impacts
What was accomplished under these goals? Continued to build budgets and provide them as requested to indusrty and IFAS researchers

Publications

• Type: Journal Articles Status: Awaiting Publication Year Published: 2015 Citation: Earnings Management through Specific Accruals and Discretionary Expenses: Evidence from U.S. Agribusiness Firms Carlos J.O. Trejo-Pech, Richard N. Weldon and Michael A. Gunderson, Canadian Journal of Agricultural Economics
• Type: Journal Articles Status: Under Review Year Published: 2015 Citation: II. Corn (Zea Mays) Nixtamalization Process: A Review, Bhaskar Anil Janve, Wade Yang, Rick N Weldon, Ren�e G Schneider, Journal of Food Engineering Reviews

Progress 10/01/09 to 09/30/14

Outputs
Target Audience: Fellow reseachers and policy makers Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided? Attended numerous workshops and conferences to continue to develop risk management models. How have the results been disseminated to communities of interest? Through papers and presentatoins. What do you plan to do during the next reporting period to accomplish the goals? Nothing Reported

Impacts
What was accomplished under these goals? All or significant parts of all four objectives haev been accomplished.

Publications

• Type: Journal Articles Status: Published Year Published: 2010 Citation: Clark, J.C., R. N. Weldon, C.M. Adams, F.F. Wirth. Risk Assessment of a Shrimp Aquaculture Investment. Aquaculture Economics and Management, 14-4 (2010), 332-357.
• Type: Conference Papers and Presentations Status: Accepted Year Published: 2011 Citation: Trejo-Pech, Carlos O*., Magdy Noguera, �ngel Samaniego-Alc�ntar and Richard N. Critical Economic Factors for Success of a Biomass Conversion Plant for Agricultural Residue, Yard Residue and Wood Waste in Florida, Ivan R. Granja, John J. VanSickle, Lonnie Ingram and Richard N. Weldon, Selected paper, 2010 Annual Meeting, February 6-9, 2010, Orlando, Florida from Southern Agricultural Economics Association, (2011)
• Type: Journal Articles Status: Published Year Published: 2013 Citation: Zhao, Youshan*, Carlos O. Trejo-Pech*, and Richard N. Weldon. The Profitability of the U.S. Food Supply Chain: Financial Indicators, Cross-Section and Time-Series Effects. The Journal of Applied Business Research  January/February 2013 Volume 29, Number 1
• Type: Journal Articles Status: Accepted Year Published: 2015 Citation: Earnings Management through Specific Accruals and Discretionary Expenses: Evidence from U.S. Agribusiness Firms Carlos J.O. Trejo-Pech, Richard N. Weldon and Michael A. Gunderson, Canadian Journal of Agricultural Economics

Progress 10/01/12 to 09/30/13

Outputs
Target Audience: Nothing Reported Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided? Nothing Reported How have the results been disseminated to communities of interest? Nothing Reported What do you plan to do during the next reporting period to accomplish the goals? Nothing Reported

Impacts
What was accomplished under these goals? Continuing to develop databases

Publications

Progress 10/01/11 to 09/30/12

Outputs
OUTPUTS: This project has developed a risk management tool to assist Florida citrus producers in dealing with the impact of citrus canker and Tristeza diseases. The project was conducted in the Department of Food and Resource Economics (FRED), Institute of Food and Agricultural Science (IFAS), University of Florida partnering with the International Agricultural Trade and Policy Center. This project provides producers and extension agents with a tool that allows them to describe the multi-year risks associated with their operation and to evaluate the impact of using various risk management strategies for managing the risk associated with citrus diseases. PARTICIPANTS: Nothing significant to report during this reporting period. TARGET AUDIENCES: Nothing significant to report during this reporting period. PROJECT MODIFICATIONS: Nothing significant to report during this reporting period.

Impacts
Transmitted findings to interested parties.

Publications

• No publications reported this period

Progress 10/01/10 to 09/30/11

Outputs
OUTPUTS: This project has developed a risk management tool to assist Florida citrus producers in dealing with the impact of citrus canker and Tristeza diseases. The project was conducted in the Department of Food and Resource Economics (FRED), Institute of Food and Agricultural Science (IFAS), University of Florida partnering with the International Agricultural Trade and Policy Center. This project provides producers and extension agents with a tool that allows them to describe the multi-year risks associated with their operation and to evaluate the impact of using various risk management strategies for managing the risk associated with citrus diseases. PARTICIPANTS: Nothing significant to report during this reporting period. TARGET AUDIENCES: Nothing significant to report during this reporting period. PROJECT MODIFICATIONS: Nothing significant to report during this reporting period.

Impacts
Nothing significant to report during this period

Publications

• Critical Economic Factors for Success of a Biomass Conversion Plant for Agricultural Residue, Yard Residue and Wood Waste in Florida, Ivan R. Granja, John J. VanSickle, Lonnie Ingram and Richard N. Weldon, Selected paper, 2010 Annual Meeting, February 6-9, 2010, Orlando, Florida from Southern Agricultural Economics Association, (2011)

Progress 10/01/09 to 09/30/10

Outputs
OUTPUTS: This project has developed a risk management tool to assist Florida citrus producers in dealing with the impact of citrus canker and Tristeza diseases. The project was conducted in the Department of Food and Resource Economics (FRED), Institute of Food and Agricultural Science (IFAS), University of Florida partnering with the International Agricultural Trade and Policy Center. This project provides producers and extension agents with a tool that allows them to describe the multi-year risks associated with their operation and to evaluate the impact of using various risk management strategies for managing the risk associated with citrus diseases. PARTICIPANTS: Nothing significant to report during this period. TARGET AUDIENCES: Nothing significant to report during this period. PROJECT MODIFICATIONS: Nothing significant to report during this period.

Impacts
Transmitted the research and extension findings to interested parties, including IFAS research and extension personnel, agribusiness professionals and actual producers. Output includes one journal article published and two manuscripts in development.

Publications

• Risk Assessment of a Shrimp Aquaculture Investment (2010) Clark, J.C., Weldon, R.N., Adams, C.M., Wirth, F.F., Aquaculture Economics and Management, 14(4) 332-357.