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Decoupling and prices: determinant of dairy farmers’ choices? A model to analyze impacts of the 2003 CAP reform

Abstract : This paper presents an analysis of the effects of the 2003 CAP reform and the price changes of agricultural products on the productive strategies of dairy farms. To do this, a model based on mathematical programming is built respecting the principle of agent rationality (profit maximization) and integrating the risk aversion due to the price volatility. This model maximizes the utility of the income, taking into account a set of constraints (zootechnical, agronomical, environmental and structural). It is applied to four types of dairy farms (grazier, semi-intensive, milk and cereal + milk + young cattle) frequent in the west of France. The simulations show how the implementation of the single payment scheme encourage farmers to change their rotations with a growing share of grassland. Price changes have, however, a strong influence on the structure of the diet and consequently on the level of intensification of the forage area. The decoupling of premiums for bovine males led farmers to turn away, all things being equal, this activity to increase the cereal production. The sensitivity analysis indicates that these changes depend on the price balance between crops and animals.
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Baptiste Lelyon, Karine Daniel, Vincent Chatellier. Decoupling and prices: determinant of dairy farmers’ choices? A model to analyze impacts of the 2003 CAP reform. 12. EAAE Congress, European Association of Agricultural Economists (EAAE). INT., Aug 2008, Ghent, Belgium. 13 p. ⟨hal-02816433⟩

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