Work

Seasonal variability, land values and willingness–to–pay for a forward wheat contract with protein premiums and discounts

Year: 1997

Type: article

Abstract: This article investigates the impact of a protein premiums and discounts system on the income stream from growing wheat. Based on a biological relationship between protein and yield in uncertain seasonal conditions, it shows that such a system reduces the expected level and variability of wheat income. It is subsequently argued, using a numerical analysis, that protein payments affect both the attraction to wheat growers of forward contracts and the value of land used for wheat. The nature of both of these impacts is related to the level of seasonal variability affecting the land. Consequently, wheat growers in the more unreliable regions of the wheatbelt may have been particularly disadvantaged by the system.

Source: Australian Journal of Agricultural and Resource Economics

DOI: 10.1111/1467-8489.00007

Author: Rob Fraser

Institution: The University of Western Australia

Language: English

Topic: Agricultural economics and policies

Subfield: Safety Research

Field: Social Sciences

Domain: Social Sciences

SDG: Zero hunger

Open Access status: bronze

Funder: University of Manchester