Small to medium-sized diversified farms have been reported to have limited profitability despite the fact that they have developed diverse systems of production to take advantage of new valuable local and regional specialty market growth. Larger commodity and specialty crop producers have very good federally subsidized insurance products that limit yield and price risks which help them maintain profitability. Farms with diverse products have very few options to assist them against similar product price and yield risks. These limitations may be the source for the limited profitability of small farms. Can diverse farms be provided with insurance that will assist them with the multiple risks of agriculture production that impact the yield and the prices of their varied products? In this presentation, the case of a whole farm insurance product designed to address the risks of diverse small farms called Adjusted Gross Revenue Lite is presented. This presentation is a based on a five year research and extension outreach project supported in part by the USDA Risk Management Agency. While the outcome of this work has demonstrated the value of this product in assisting diversified farms to limit some price and yield risk it has also led to a better understanding of changes needed to develop improved ways to assist diversified farms. Our findings suggest that if the coverage level is raised and better accounting of the risk reduction of enterprise diversity itself were more clearly recognized, then an improved means to lower diversified farm economic risks is possible.
|Conference||2013 Extension Risk Management Education National Conference|
|Presentation Type||60-Minute Concurrent|