ABSTRACT
This chapter considers the role that price volatility may play in on-farm decisions from a producer’s perspective. Upside risk is beneficial to producers and may reduce on-farm food loss by incentivizing greater harvest intensity. Crop marketing methods can affect producer sensitivity to changes in market prices. One approach to measuring on-farm food loss is to calculate the harvest success rate, i.e., the fraction of a crop’s planted area that ultimately was harvested. The larger the fraction, the higher the harvest success and the smaller the measured loss. The negative correlation for price variability is consistent with the idea that more variable prices are correlated to lower harvest success and potentially greater on-farm food loss. Clean identification of the relationship between on-farm food loss and prices requires a better-specified approach and access to more data. Food loss at the farm level is the result of economic decisions made by private agents.
