Futures Hedging Under Price, Basis, and Production Risk

1994 ◽  
Vol 76 (3) ◽  
pp. 465-477 ◽  
Author(s):  
Harvey Lapan ◽  
Giancarlo Moschini
Keyword(s):  
Production Risk ◽  
Futures Hedging

Der Wald-Wild-Konflikt – was kann die Forstökonomie zur Lösung beitragen? (Essay)

2017 ◽  
Vol 168 (4) ◽  
pp. 181-185
Author(s):  
Marc Hanewinkel
Keyword(s):  
Forest Economics ◽  
Production Risk ◽  
Damage Compensation ◽  
Land Expectation Value ◽  
Compensation Methods ◽  
The Future ◽  
Single Tree Selection ◽  
Simplifying Assumptions ◽  
Forest Enterprises

The forest-game conflict – how can forest economics contribute to solve it? (Essay) Core parameters of forest economics such as land expectation value or highest revenue show that damage caused by wild ungulates can critically influence the economic success of forest enterprises. When assessing and evaluating the damage in order to calculate damage compensation, methods are applied in Germany that look either into the past (“cost value methods”) or into the future (“expected value methods”). The manifold uncertainties related to this evaluation over long-term production periods are taken into account within a framework of conventions through strongly simplifying assumptions. Only lately, the increased production risk due to game-induced loss of species diversity is also considered. Additional aspects that should be taken into account in the future are the loss of climate-adapted species, the change of the insurance values of forest ecosystems and the impossibility of specific management systems such as single-tree selection forestry due to the influence of game. Because of high transaction costs when assessing the damage, financial compensation should only be the “ultimate measure” and a meditation between stakeholder groups with the goal to find a cooperative solution before the damage occurs should be preferred.

scholarly journals Farmers’ Climate Change Adaptation Strategies for Reducing the Risk of Rice Production: Evidence from Rajshahi District in Bangladesh

Agronomy ◽  
2021 ◽  
Vol 11 (3) ◽  
pp. 600
Author(s):  
Shahjahan Ali ◽  
Bikash Chandra Ghosh ◽  
Ataul Gani Osmani ◽  
Elias Hossain ◽  
Csaba Fogarassy
Keyword(s):  
Climate Change ◽  
Climate Change Adaptation ◽  
Rice Production ◽  
Adaptation Strategies ◽  
Production Risk ◽  
Substantial Impact ◽  
Rice Farmers ◽  
Agronomic Practices ◽  
Rice Yields ◽  
Climate Change Adaptation Strategies

A lack of adaptive capacities for climate change prevents poor farmers from diversifying agricultural production in Bangladesh’s drought-resilient areas. Climate change adaptation strategies can reduce the production risk relating to unforeseen climatic shocks and increase farmers’ food, income, and livelihood security. This paper investigates rice farmers’ adaptive capacities to adapt climate change strategies to reduce the rice production risk. The study collected 400 farm-level micro-data of rice farmers with the direct cooperation of Rajshahi District. The survey was conducted during periods between June and July of 2020. Rice farmers’ adaptive capacities were estimated quantitatively by categorizing the farmers as high, moderate, and low level adapters to climate change adaptation strategies. In this study, a Cobb–Douglas production function was used to measure the effects of farmers’ adaptive capacities on rice production. The obtained results show that farmers are moderately adaptive in terms of adaptation strategies on climate change and the degree of adaptation capacities. Agronomic practices such as the quantity of fertilizer used, the amount of labor, the farm’s size, and extension contacts have a substantial impact on rice production. This study recommends that a farmer more significantly adjusts to adaptation strategies on climate change to reduce rice production. These strategies will help farmers to reduce the risk and produce higher quality rice. Consequently, rice farmers should facilitate better extension services and change the present agronomic practice to attain a higher adaptation status. It can be very clearly seen that low adaptability results in lower rice yields.

scholarly journals Production risk, technical efficiency, and input use nexus: Lessons from Bangladesh aquaculture

2021 ◽  
Vol 52 (1) ◽  
pp. 57-72
Author(s):  
Md. Akhtaruzzaman Khan ◽  
Ratna Begum ◽  
Rasmus Nielsen ◽  
Ayoe Hoff
Keyword(s):  
Technical Efficiency ◽  
Production Risk ◽  
Input Use

scholarly journals Quantitative study on natural gas production risk of Carboniferous gas reservoir in eastern Sichuan

2021 ◽  
Author(s):  
Guo Yu ◽  
Haitao Li ◽  
Yanru Chen ◽  
Linqing Liu ◽  
Chenyu Wang ◽  
...  
Keyword(s):  
Risk Factors ◽  
Risk Factor ◽  
Natural Gas ◽  
Gas Production ◽  
Probability Method ◽  
Gas Reservoir ◽  
Production Risk ◽  
Probability Interval ◽  
Natural Gas Production ◽  
Stable Production

AbstractQuantifying natural gas production risk can help guide natural gas exploration and development in Carboniferous gas reservoirs. In this study, the Monte Carlo probability method is used to obtain the probability distribution and growth curve of each production risk factor and production in a Carboniferous gas reservoir in eastern Sichuan. In addition, the fuzzy comprehensive evaluation method is used to conduct the sensitivity analysis of the risk factors, and the natural gas production and realization probability under different risk factors are obtained. The research results show that: (1) the risk factor–production growth curve and probability distribution are calculated by the Monte Carlo probability method. The average annual production under the stable production stage under different realization probabilities is obtained. The maximum probability range of annual production is $$\left( {43.43 - 126.35} \right) \times 10^{8} {\text{m}}^{3} /{\text{year}}$$ 43.43 - 126.35 × 10 8 m 3 / year , and the probability range is 14.59–92.88%. (2) The risk factor sensitivity analysis is significantly affected by the probability interval. In the entire probability interval, the more sensitive risk factors are the average production of the kilometer-deep well (D) and the production rate in the stable production stage (A). During the exploration and development of natural gas, these two risk factors can be adjusted to increase production.

Futures hedging effectiveness under the segmentation of bear/bull energy markets

2010 ◽  
Vol 32 (2) ◽  
pp. 442-449 ◽  
Author(s):  
Chiao-Yi Chang ◽  
Jing-Yi Lai ◽  
I-Yuan Chuang
Keyword(s):  
Energy Markets ◽  
Hedging Effectiveness ◽  
Futures Hedging

Seasonal patterns of futures hedging and the resolution of output uncertainty

1991 ◽  
Vol 53 (2) ◽  
pp. 304-327 ◽  
Author(s):  
David Hirshleifer
Keyword(s):  
Seasonal Patterns ◽  
Futures Hedging ◽  
Output Uncertainty

ANALYSIS OF PRODUCTION RISK FROM CRUSHES OF ROCKS AT EXCAVATION SITES, TAKING INTO ACCOUNT WAYS OF PROTECTION

2021 ◽  
pp. 124-134
Author(s):  
Iaroslav Liashok ◽  
◽  
Serhii Podkopaiev ◽  
Yuliia Simonova ◽  
Hennadii Boichenko ◽  
...  
Keyword(s):  
Practical Significance ◽  
Production Risk ◽  
Venn Diagrams ◽  
Deep Coal Mine ◽  
Geological Conditions ◽  
Rock Collapse ◽  
Available Information ◽  
Decision Making Model ◽  
Excavation Site ◽  
Industrial Risk

Purpose. To assess the production risk of rock collapse in a deep coal mine to identify hazards in the workplaces of the excavation site, taking into account different methods of protection of workings. Methods. A comprehensive approach was used, which included: analysis and generalization of known research; expert evaluation; use of the basic provisions of probability theory and set algebra (Venn diagrams), the method of estimating the production risk of Fine-Kinney; processing, analysis and interpretation of the obtained results. Results. Problems and sources of industrial risk from rock collapses during maintenance of workings, risk-forming factors that contribute to the threat of dangerous events at the excavation site are analyzed. The decision-making model is considered, which is based on the description of situations when the production risk of the dangerous factor “landslides and collapses” in the maintenance of preparatory workings depends on the result of choosing an alternative method of protection of the retractable lane. For excavation sites under the same mining and geological conditions for all workplaces, the probability of receiving consequences from dangerous events due to uncertain conditions of their implementation has been established. It is fixed that the realization of this production risk is influenced by low reliability and inefficiency of the practiced methods of protection of excavations. Risk analysis is defined as the systematic use of available information to identify hazards in the maintenance of long workings. Novelty. A model for monitoring the production risk of rock collapses in excavations of deep coal mines is proposed, which allows assessing the dynamics of the threat at the stage of technical decisions related to the choice and justification of the method of protection of workings taking into account the interaction of risk factors. Practical significance. When formulating measures to reduce the risk of dangerous events at the excavation site, it is necessary to take into account that the production risk of rock collapse while maintaining the workings depends largely on the method of protection and effectiveness of technological measures.

scholarly journals Production choices with water markets and risk aversion: the role of initial allocations and forward trading

2018 ◽  
Vol 46 (4) ◽  
pp. 579-608 ◽  
Author(s):  
Philippe Bontems ◽  
Céline Nauges
Keyword(s):  
Irrigation Water ◽  
Weather Conditions ◽  
Water Markets ◽  
Initial Water ◽  
Production Risk ◽  
Net Returns ◽  
Murray Darling Basin ◽  
Forward Trading ◽  
Allocation Decisions

Abstract We develop a theoretical model that describes risk-averse farmers’ decisions when facing production risk due to uncertain weather conditions and when irrigation water can be traded on a market. We focus on the role of initial water allocations granted to irrigated farms at the start of the season. The presence of water markets makes the future water price uncertain and hence the value of initial water allocations uncertain. We analyse the properties of this background risk and study how initial water allocations impact farmers’ land allocation decisions between an irrigated crop and a non-irrigated crop, both characterised by random expected net returns. We then extend the model by permitting irrigation water to be traded ex-ante at a known price (forward market). Finally, we illustrate our main theoretical findings using simulations. We calibrate distributions of the random variables based on observed data from the Murray–Darling Basin in Australia where a water market has been in place for several decades.

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