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Analysis of risk management tools applicable in managing farm risks: A literature review

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  • Leppälä, Jarkko
  • Rautiainen, Risto
  • Kauranen, Ilkka

Abstract

The objective of this study was to list and analyse risk management tools applicable in managing farm risks. A literature search of several large literature databases was conducted. By using risk management-related keywords, a total of 13,559 articles discussing risk management were identified. Of these, 157 articles were selected for closer analysis applicable to dairy, cattle, pig or crop production. Both journal articles and book chapters in English were included. The articles were categorized based on the applied risk focus and type of risk management tools presented. In accordance with this, potential farm risk management tools were searched from the research studies associated with production, assets, economics and finance, human health and safety, and the environmental risks on farms. An important outcome of the study was a tool case for farm risk management stages, in which either the potential farm risk tools can each be used to address a single risk or the tools can be holistically applied. Farmers face multi-risk management demands, but comprehensive literature studies on multi-risk management tools on farms have been rare. Farm risk management tools and information provided to farmers are not at a sufficient level if we compare them to the current risks and social demands that farmers are facing. The possible farm risks should be clarified to farmers that they can identify them on farms. Furthermore, in order to integrate farm risk management tools, the links between the risks should be made visible among farm operations and farm production processes. Complexity and usability are future challenges in the further development of tools for managing farm risks. Applying the new farm risk tools in a sustainable manner requires farm managers to adopt new knowledge management techniques. Education programmes are needed to address the new skills that are required, and communication and co-operation between different research disciplines is also necessary.

Suggested Citation

  • Leppälä, Jarkko & Rautiainen, Risto & Kauranen, Ilkka, 2015. "Analysis of risk management tools applicable in managing farm risks: A literature review," International Journal of Agricultural Management, Institute of Agricultural Management, vol. 4(3), April.
    • Handle: RePEc:ags:ijameu:262368
    DOI: 10.22004/ag.econ.262368
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    References listed on IDEAS

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    1. Pardeshi, Shefali & Loughrey, Jason & O’Connor, Declan, 2024. "Farm Investment and Adoption of Fixed Milk Price Contracts on Irish Dairy Farms," IAAE 2024 Conference, August 2-7, 2024, New Delhi, India 344291, International Association of Agricultural Economists (IAAE).

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    Keywords

    Farm Management; Risk and Uncertainty;

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