Up to $50,000 available for Risk Management Education
The Request for Applications (RFA) for the 2013 Western Center for Risk Management Education Program was issued November 1, 2012.
Pre-proposal are due December 12, 2012.
The purpose of the program is to fund projects that help farm and ranch families succeed through targeted risk management strategies. Effective risk management means selecting tools and approaches that reduce the adverse financial effects of the uncertainties of weather, yields, prices, credit, government policies, global markets and other factors, including human resources and legal issues – all of which can cause wide swings in farm income or threaten the economic viability of the farm or ranch.
Effective risk management education should help producers make a comparative risk assessment of alternative production or management practices.
Grant awards typically range from $5,000 to $50,000, although there is no absolute upper or lower limit. Awards will be for 12 month programs beginning July 1, 2013 and ending June 30, 2014.
This program has a two-step process. Applicants first submit a pre-proposal application; The Western Center will then invite selected applicants to submit full proposals based on their review of the concept proposals. The Western Center will notify applicants by February 1, 2013 if they have been selected to submit full proposals. Full proposals will be due by February 28, 2013. Awardees will be notified by May 1, 2013.
For the full RFA, visit: http://westrme.wsu.edu/grants-program/
RISK TOPIC AREAS
The Western Center is interested in projects that cover the spectrum of risk management needs for agricultural producers. The following risk topic areas will be given extra consideration (detailed below):
- Managing risks associated with the increased volatility of input costs and market prices
- Managing risks associated with pests, diseases and natural disasters such as drought, floods, and fire that affect the economic viability of farms and ranches
- Managing counterparty risk of default
- Managing business risk and building capacity for beginning and transitioning farmers and ranchers
(1) Increased volatility of input costs and market prices
Projects that build the capacity of farmers and ranchers to manage market volatility through one or more of the following: improved marketing, forward contracting, strategic outlook, enterprise diversification, the economics of production management and financial planning are regional risk management priorities. Due to increased volatility, farm and ranch gross revenue, costs, and profit variability have greatly increased agricultural producers’ financial risk.
(2) Pests, diseases and natural disasters
Pest infestations, diseases and natural disasters are unexpected events that can greatly increase agricultural producers’ production, market and financial risks. Projects that address these types of risks through improved understanding and use of: insurance products, risk mitigating production strategies and strategic planning are regional risk management priorities.
For example: in the case of fire or drought livestock producers ability to graze expected forage sources may be eliminated. Proposals that help producers evaluate and implement alternative feeds and forage sources such as emergency CRP grazing are encouraged.
(3) Counterparty risk of default
Contracts are increasingly being used for marketing and asset management. As agricultural market volatility increases, the risk of contractual default increases. Losses from this risk often come without warning, and can be significant. Counterparty risk is the risk that the party on the other end of your contract will not perform as agreed and may default on that contract.
This can be broken down further into the risks involved with:
- Payment and/or delivery default
- Contracts that have no value
- Deferred payments may not be received
An example of counterparty risk is a hay farmer delivering hay where the buyer defaults on payment which forces the hay farmer to undertake collective action. Agriculture producers need to increase their ability to manage the increasing complexity of counterparty risk through risk management education and programs.
(4) Beginning and transitioning farmers and ranchers
Beginning and transitioning farmers as well as farmers seeking to pursue new markets are identified as a special emphasis audience. Proposals are encouraged that develop risk management programs for this audience. Projects that use the Building Farmers in the West comprehensive program management guide may qualify for train the trainer instruction and support provided by the Building Farmer in the West program. Programs using other beginning and transitioning farmer curriculums will be equally considered and are encouraged to apply.
- Private and public groups
- Institutions including land grant colleges and universities
- Cooperative extension
- Other colleges and universities
- Qualified public and private entities in the region with a demonstrated capacity to develop and deliver educational programs for agricultural producers and their families:
- Farm organizations
- Commodity groups
- Risk management service providers (such as crop insurance agents and other non-governmental and community based organizations)
The Western Center serves Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, Wyoming and the U.S. affiliated Pacific Islands.
No match required.
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