Farm Management

Risks to farm operations

Every activity carries risks, especially agricultural production. It is necessary to identify these risks and work to minimise them.

This includes both typical agronomic risks (e.g. weather, crop, technical, animal health, etc.), financial risks (dependence on a single customer or supplier, lack of sources of funding for the activity) and social risks (e.g. the reaction of the local community to the production activities of the farm). Sustainable agricultural production involves minimising the risks that have been identified to make the activity sustainable and profitable. Risks in livestock production are animal diseases and environmental changes, unstable markets and unpredictable regulations. Risks in crop production are mainly related to the soil, climate and environmental conditions of the farm or field. For example: a location next to a forest or on the edge of a city may carry risks due to damage caused by animals or people. Crop selection must take these risks into account to ensure the expected yield and financial effect. Even with an accurate plant and variety selection, variability in climatic conditions and pathogen outbreaks can lead to crop failure or worse-than-planned results. The business plan must be realistic, built on facts. Increases in unfavourable weather phenomena for agriculture as a result of climate change, such as, for example, frosts, droughts or increased pests, or trends in regulations, must be identified and taken into account in the business plan and production organisation. To this end, it is necessary to identify:

  • how often in recent years there have been significant production losses due to adverse weather patterns and the level of these losses, and which crops were affected,
  • on the basis of trends in the appearance of diseases and pests, evaluate the effectiveness of previous plant protection treatments,
  • through soil surveys, it should be determined whether soil degradation is occurring,
  • identify the risk of not being able to carry out agrotechnical treatments on time,
  • what regulations are announced by politicians,
  • what market developments are noticeable or announced.

More on agricultural risk in Area 3: Financial Stability.