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Incorporating Uncertainty in the Analysis of Optimal Beef-Forage Production Systems

Published online by Cambridge University Press:  08 February 2017

Richard B. Rawlins  and
Daniel J. Bernardo
Richard B. Rawlins
Affiliation:
Department of Agricultural Economics, Oklahoma State University, Stillwater, Oklahoma
Daniel J. Bernardo
Affiliation:
Department of Agricultural Economics, Oklahoma State University, Stillwater, Oklahoma
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Abstract

A risk programming model was developed to evaluate the tradeoffs between risk and expected returns in beef-forage production systems. The specification represents nutrient and intake considerations when allocating forage among cattle enterprises; it also incorporates the various sources of risk facing livestock producers. Efficient ranch organizations were derived for a representative eastern Oklahoma ranch using MOTAD and Target-MOTAD formulations. Diversification of forage enterprises, introduction of cow-calf enterprises, and retained ownership of weaned calves were identified as important responses to reductions in acceptable levels of risk. Results also indicated efficient ranch plans to be sensitive to the risk criteria and producer's willingness to accept risk.

Type
Articles
Information
Journal of Agricultural and Applied Economics , Volume 23 , Issue 1 , July 1991 , pp. 213 - 225
Copyright
Copyright © Southern Agricultural Economics Association 1991

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