Alternative Strategies to Manage Weather Risk in Perennial Fruit Crop Production

• Published in: Agricultural and resource economics review Vol. 47; no. 3; pp. 452 - 476
• Main Authors: Ho, Shuay-Tsyr, Ifft, Jennifer E., Rickard, Bradley J., Turvey, Calum G.
• Format: Journal Article
• Language: English
• Published: New York, USA Cambridge University Press 01.12.2018
• Subjects: Agricultural economics; Agricultural production; Agriculture; Blueberries; Cost analysis; Crop insurance; Crop production; Crops; Economic theory; Economics; Farms; Food; Fruits; Harvest; Impact analysis; Insurance; Meteorological data; Precipitation; Profitability; Rain; Revenue; Risk management; Strawberries; Tunnels; Vegetables; Weather; United States > US; Great Lakes area; Michigan; weather insurance; crop insurance; risk management; specialty crops; high tunnels
• ISSN: 1068-2805; 2372-2614
• DOI: 10.1017/age.2017.29

Fruit producers in the Eastern United States face a wide range of weather-related risks that have the capacity to largely impact yields and profitability. This research examines the economic implications associated with responding to these risks for sweet cherry production in three different systems: high tunnels, revenue insurance, and weather insurance. The analysis considers a distribution of revenue flows and costs using detailed price, yield, and weather data between 1984 and 2013. Our results show that the high tunnel system generates the largest net return if significant price premiums exist for earlier and larger fruit.