Climate Variability and Agricultural Production in Argentina: The Role of Risk-Transfer Mechanisms

Serie Documentos de Trabajo - Nro. 583

97 Pages Posted: 9 Mar 2016

See all articles by Marcos Gallacher

Marcos Gallacher

University of CEMA

Daniel Lema

Universidad del CEMA

Alejandro Galetto

Universidad Austral

Laura Gastaldi

National Institute of Agricultural Technology (INTA) - Estación Experimental Agropecuaria (EEA), Rafaela

Date Written: December 2015

Abstract

Research related to climate variability is particularly important in the current conditions faced by Argentine agriculture. These include (a) increased specialization in soybeans, with resulting reduced possibilities of risk-reduction though “portfolio” effects, (b) increased importance of agriculture in “non-traditional” areas, generally characterized by lower yields, higher yield variability and higher production and transport costs, (c) macroeconomic instability resulting in severe contraction and increased interest rates of credit and (d) upward trend in input use and per-acre production costs with consequent increase in break-even crop yields. This paper summarize recent research related to production variability in Argentine agriculture, as well as the consequences of this variability on efficiency and resource allocation and present an overview of strategies for coping with climate variability. We estimate possible benefits to agricultural producers of improved risk-transfer mechanisms. In particular, we obtain estimates of Willingness-to-Pay (WTP) of selected index-type insurance mechanisms for soybean and milk production and outline the requirements for the development of a risk-transfer market for agricultural producers.

Suggested Citation

Gallacher, Marcos and Lema, Daniel and Galetto, Alejandro and Gastaldi, Laura, Climate Variability and Agricultural Production in Argentina: The Role of Risk-Transfer Mechanisms (December 2015). Serie Documentos de Trabajo - Nro. 583 , Available at SSRN: https://ssrn.com/abstract=2745287 or http://dx.doi.org/10.2139/ssrn.2745287

Marcos Gallacher (Contact Author)

University of CEMA ( email )

1054 Buenos Aires
Argentina

Daniel Lema

Universidad del CEMA ( email )

1054 Buenos Aires
Argentina

Alejandro Galetto

Universidad Austral ( email )

Juan de Garay 125
Buenos Aires, 1065
Argentina

Laura Gastaldi

National Institute of Agricultural Technology (INTA) - Estación Experimental Agropecuaria (EEA), Rafaela ( email )

Ruta 34 Km 227
Rafaela, Santa Fe
Argentina

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