Abstract
While agriculture is unique with respect to the prevalence of producer owned cooperatives (coops) operating alongside and investor owned firms (IOFs), little is known about their relative reliance on futures markets to hedge commodity price risk. This study investigates factors influencing the hedging behavior of both business forms and finds that each are significantly impacted by the perspective of key influencers of their decision making units (e.g., employees, members, shareholders, board of directors, advisors, consultants, bankers). Notably, coops are found to be more likely to hedge using futures but do so more sparingly (i.e., lower hedging ratios), which may reflect an ability to conduct natural hedges internally and/or less speculative positions taken in futures markets. [Econ Lit classification: Q130].
Original language | English |
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Article number | 100219 |
Journal | Journal of Co-operative Organization and Management |
Volume | 11 |
Issue number | 2 |
DOIs | |
Publication status | Published - 1 Dec 2023 |
Keywords
- Agribusiness
- Cooperatives
- Futures Market
- Hedging
- Risk Attitude