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Wheat Variety Selection to Maximize Returns and Minimize Risk: An Application of Portfolio Theory

Published online by Cambridge University Press:  26 January 2015

Andrew Barkley ,
Hikaru Hawana Peterson  and
James Shroyer
Andrew Barkley
Affiliation:
Department of Agricultural Economics, Kansas State University, Manhattan, KS
Hikaru Hawana Peterson
Affiliation:
Department of Agricultural Economics, Kansas State University, Manhattan, KS
James Shroyer
Affiliation:
Department of Agronomy, Kansas State University, Manhattan, KS
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Abstract

This research shows that a portfolio of wheat varieties could enhance profitability and reduce risk over the selection of a single variety for Kansas wheat producers. Many Kansas wheat farmers select varieties solely based on published average yields. This study uses portfolio theory from business investment analysis to find the optimal, yield-maximizing and risk-minimizing combination of wheat varieties in Kansas.

Keywords

portfolio theorywheat variety selectionQ12Q16
Type
Research Article
Information
Journal of Agricultural and Applied Economics , Volume 42 , Issue 1 , February 2010 , pp. 39 - 55
Copyright
Copyright © Southern Agricultural Economics Association 2010

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