Price volatility jeopardizes investments in dairy farming – options to control risk need to be explored

We analyze the robustness of investment profitability in terms of different variables. We step further from Net Present Value calculation methods to a method where volatility of these variables is taken into account. Finally, the influence of different price stabilizing instruments is evaluated.

The main outputs of the study are a description of the existing risk management tools in the dairy sector and a calculation model that takes into account the impact of price risks on the profitability of investments.