Sources and management of risk in extensive livestock farming in the North-Western Transvaal Bushveld

Abstract

A survey involving 93 farmers in the North-Western Transvaal Bushveld reveals sources of and responses to risk in farm production, marketing and financing. Main sources of risk were considered to be variations in livestock production, rainfall and livestock prices, the threat of land reform, and changes in input costs. The most important production responses to risk include low-cost production, choice of production system and changing livestock numbers. Acceptance of the floor price scheme was regarded as the most important marketing response to risk, while financial record keeping, debt management and maintaining credit reserves were considered the major financial responses to risk. The results could assist policy makers, lenders, extension officers and consultants in designing appropriate risk management programmes and strategies for farmers in the study area.