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Risk Management Plans and Tools for Farm Businesses

Steve Richards

Summary

In 2004, our risk management education strategy revolved around having NY FarmNet consultants help farms implement risk management plans. This education effort had three parts: risk management planning, guides and workbooks, and a referral network.

Risk Management Planning
A checklist was developed for consultants to use in identifying risks to particular farm operations. The consultant then works with the family to implement a plan to reduce these risks.

Guides and Workbooks
To assist in making the family feel more comfortable adopting new risk management strategies, they are given free choice of the FarmNet/FarmLink library--a collection of business planning and risk management resources. Two new resources were developed in 2004 to address production and marketing risks: Do I Need Crop Insurance: Self Evaluating Crop Insurance as a Risk Management Tool and Using Crop Insurance: Profiles of 13 Farmers Who Use Crop Insurance as a Risk Management Tool.

Referral Network
Once risk mitigation strategies have been identified, families often need outside professional service providers: attorneys, insurance providers, etc. NY FarmNet\FarmLink has created a referral database to help these producers implement their plan effectively. In this manner, no gap is created from strategy to implementation.

This educational effort has been very effective. In 2004, over 50 Risk Management Plans were completed, close to 500 guides and workbooks were distributed, and 540 referrals to agricultural professionals were made. By helping the producer from planning all the way to implementation, we could guarantee positive risk management change on all of these 50 farm businesses.

Details

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