Italian Review of Agricultural Economics (REA) publishes Online First Articles. This feature allows final revision articles to be hosted online prior to their inclusion in a final print and online journal issue.

Weather Risk Management in Agriculture Using Weather Derivatives

Martina Bobriková

Department of Finance, Faculty of Economics, Technical University of Košice - Slovak Republic

Accepted: 2022-05-30 | Published Online: 2022-08-05
DOI: 10.36253/rea-13416


The purpose of this paper is to examine weather risk management by application of weather derivatives in agriculture and evaluate the hedging efficiency. Agriculture is a sector highly sensitive to meteorological elements that affect the yield of many crops. The underlying weather indices depending on temperature, rainfall and wind speed are analysed. Pricing follows the index modelling method using the Burn analysis valuation for fair premium calculation. The proposal of hedging strategies against excess rainfall in the crop cycle using weather options for Kosice region in the east of Slovakia is investigated and discussed. Results show that the weather derivatives application in weather risk management reduced the yield volatility in agriculture.


The economic value of ecosystem services of irrigation: a choice experiment for the monetary evaluation of irrigation canals and fontanili in Lombardy

Myriam Ruberto
Department of Economic, Engineering, Society and Business Organization (DEIM) - Tuscia University, Italy
CREA - Research Centre for Agricultural Policies and Bioeconomy, Italy

 Giacomo Branca
Department of Economic, Engineering, Society and Business Organization (DEIM) - Tuscia University, Italy

Stefania Troiano
Department of Economics and Statistics - University of Udine, Italy

Raffaella Zucaro
CREA - Research Centre for Agricultural Policies and Bioeconomy, Italy

Accepted: 2022-05-30 | Published Online: 2022-08-05

DOI: 10.36253/rea-13404


The Water Framework Directive (WFD) has introduced economic principles for water resource management, including the environmental cost recovery on the basis of the polluter pays principle (PPP). Agriculture, as a potential driver of pressures on water bodies, can produce environmental costs. However, the use of water in agriculture can produce ecosystem services (ES), especially through the aquatic systems of the traditional irrigation agro-ecosystem. This work presents a case study of monetary estimation of some ES of aquatic ecosystems linked to irrigation, i.e. irrigation canals and fontanili in Lombardy (Italy). Through the choice experiment method, we obtained positive values of willingness to pay for the highest levels of ES analysed. This has an implication in the context of the economic analysis of water uses and the decision-making process within the interventions planning of irrigation efficiency improvement.


Households’ Rice Demand Response to Changes in Price, Income and Coping Strategies during Food Inflation in Nigeria: Evidence from Oyo State

Obayelu Abiodun Elijah, Wintola Adeola Oluwaseun
Department of Agricultural Economics and Farm Management, Federal University of Agriculture, Abeokuta, Ogun State, Nigeria

Oluwalana Elizabeth Olufunmilayo Ayokunnumi
Agricultural Media Resources & Extension Centre (AMREC) / Agricultural Economics & Farm Management

Accepted: 2022-07-06 | Published Online: 2022-08-05

DOI: 10.36253/rea-13602


Food price is a main driver of inflation that erodes the purchasing power of households. The study examined demand response to changes in price of rice during food price inflation in Nigeria using sampled households from Oyo State. A multi-stage sampling procedure was used to select 174 households for the study. Primary data were obtained on types of rice, frequency and quantity bought, reasons for demand, price variations and coping strategies. Descriptive statistics and Quadratic Almost Ideal Demand System (QUAIDS) that take into account the non-linear impact of income changes was used for data analysis. Over 70% of households’ demand was for imported long grain rice, local brown and wet grain rice and local brown and dry grain rice. The expenditure elasticities of both local short brown wet rice (LSBWR) and imported short grain rice (ISGR) was positive and <1 indicating that they were normal and necessary food items. Strategies mainly used to cope with rice price and households’ income changes include: substitution of rice with other food types, preparation of rice with other foods to reduce quantity of rice in meals and reduction of rice demand. Even though price intervention may not lead to a significant effect on rice demand, an improvement in technology will lead to reduction in the cost of rice production and eventually reduce the price of local rice, enhance high demand and encourage producers to increase production.