Study On Production And Operation Entity Risk Management Of Vegetable Industry

At present, China’s vegetables output is more than grain output, become China’s firstmajor agricultural products. Vegetable industry has important strategic significance inpromoting the farmers’ income and improving the people’s quality of life. With theimprovement of living standards of urban and rural residents and the development ofmodern agriculture, and the pattern of vegetables small-scale-family plant is difficult toadapt to the needs of economic development. At the same time, the new agriculturaloperators in vegetable industry is developing rapidly, which include vegetablesprofessional cooperatives, vegetable enterprises, planting large and family farm, and thenew operators have become the main direction of vegetables operators. But compared withfood crops, there is a higher natural and market risk in vegetable industry because of theparticularity of vegetable products. Following with the improvement of the consumerattention on vegetable safety, quality and diversity, it is more and more prominent aboutvegetable production technology and quality risk; vegetable price volatility and unsalablerisk increases gradually with the rising of production costs and competition in the market;and the vegetable environmental risk caused by the the excessive use of fertilizers andpesticides in vegetable production; fresh vegetable logistics risk in the process oftransportation and contract risk in the operation process of vegetables; which all makevegetable operators cannot achieve the profit maximization. So, it is has importanttheoretical value and practical significance on protect income continues increasing ofvegetable production and operation entity and to promote the sustainable development ofvegetable industry by systematic analysis the problems existing in the process of riskmanagement of different types of vegetable, and scientific design risk managementmechanism for vegetables production and operation entity.Through in-depth analysis of the risk management and use the agricultural productionand operation risk management theory and practice at home and abroad for reference, thearticle system analysis of the main problems and influencing factors on vegetableproduction and operation in risk cognition, risk identification, risk assessment and riskmanagement strategy choice by using various measurement method and mathematicalstatistical model. The article also build vegetable production management risk earlywarning mechanism and risk management framework based on the comprehensive analysis, and put forward the guarantee mechanism of risk management for vegetable productionand operation entity. Research results mainly includes the following aspects:(1) First use the economics manufacturers defining the concept of vegetableproduction entity, and points out that the operation goal of vegetable operation entiry isprofit maximization. But under the condition of incomplete and asymmetric information, itis difficult for the vegetable production and operation entity to achieve the profitmaximization goal because of the existence of all kinds of risk factors. Through the latestresearch results of risk assessment and decision-making behavior theory, theory of riskcontrol and risk management theory to research the theoretical framework of vegetableproduction and operation entity risk management problem.(2) On the basis of field investigation, Vegetable production and operation entity isdivided into small-scale vegaetable family farmers, vegetables professional cooperatives,vegetable enterprises, planting large and other types. At first, the article analyzed thevegetable production and operation entity’s the risk recognition and cognitive ability andthe influence factors about different types, different areas and economic development level,different size, different vegetable varieties. Secondly, the article built the Binary ChoiceProbit Model to empirical analysis the influence factors of perception of the vegetablequality risk, and the model analysis results show that the education level, the planting scaleand the region economic development level of vegetable production and operation entity,the government propaganda about risk management has obvious effects on riskmanagement cognitive ability of vegetable production and operation entity.(3) Vegetable production and operators risk is divided into production risk andoperation risk, which all finally show the income risk of vegetable production andoperation entity. Using the statistical data about agricultural production, the market priceand income level come from The National Agricultural Product Cost and Benefit DataCollection (1998-2012), the article calculate the production risk, market risk and profit risklevel about vegetable products using the three year lag mobile variation coefficient.Through comparing the risk level between the vegetable and other crops and14kinds ofcommon vegetables, we can get the coclusion that vegetable market price risk level ishigher than other crops, but the vegetable profit risk is at a below-average level comparedwith other agricultural products; and the facilities vegetables risk level significantly lowerthan the open field vegetables. It provide a scientific basis for variety selection ofvegetables for vegetable production and operation entity that the risk level measure ofvegetable products.(4) On the basis of risk measure for vegetable production and operation entity, thearticle research the risk evaluation on different types of vegetable production and operationentity about vegetables overall risk in the process of production and operation and the riskbear ability of vegetable production and operation entity. With vegetables family farmers, planting large, specialized cooperative as the research object, the article estimated thevegetable production and operation risk level such as natural risk, quality risk, marketingrisk, management risk, and social risk by using AHP-FCE method build the secondarythree layers fuzzy comprehensive evaluation model. Model estimation results show that therisk level of vegetable planting large is highest, and the risk level of vegetable professionalcooperatives is lowest.(5) Through investigation and analysis on the present situation and effectivenessevaluation of the application of risk management strategy that the small-scale vegaetablefamily farmers, vegetables professional cooperatives, vegetable enterprises, planting largeand other entirys used to risk management, which will provide the reality basis for thegovernment to support the vegetables production and business operation risk managementsystem construction. Research indicates that vegetable production and operation entity lackof risk management ability, and the risk avoidance and risk containment strategy is themost commonly used risk management methods for operation entity. Due to the lagging ofthe rural financial development, it is difficult for operators to transfer their production andoperation risk by vegetables insurance and agricultural futures market.(6) Based on the present study on the vegetable production and operation riskmanagement system, the article built the vegetable production management risk earlywarning system which included vegetable comprehensive information monitoring system,risk forecast and early warning system, early warning information release system andinformation emergency response system. Use the potato market price prediction as anexample to build BP artificial neural network risk warning model to forecast market riskfor vegetable production and operation entity.(7) At last, the article design risk management mechanism for vegetable productionand operation entity. The risk management mechanism is divided into formal mechanismand informal mechanism, and the risk management of decision-making can be divided intomicro, meso and macro three levels. The article also analysis of the mechanism of action ofdifferent types of risk management of decision-making. In order to achive the effective riskmanagement goals, the new vegetable risk management system was built that give priorityto vegetables insurance, and other risk management measure as complementary such asvegetables production technology popularization, ecological conservation, vegetablefutures and agricultural relief.In this paper, the innovations include: at first, subject innovation. The paper selectvegetable production and operation entity risk management as research object, andresearch on different types of vegetables operation entity as the policymakers forproduction plan and market behavior, how to carry on the risk management decision underthe condition of incomplete information, which will enrich the theory of agricultural riskmanagement. Secondly, application methods innovation. The BP artificial neural network model which used in international academic circles in recent years was used to constructthe vegetables production and business operation risk early warning system, and throughthe subjective measure method, the weighted moving average coefficient method onmeasurement the extent and frequency of the damage of agricultural production andoperation risk. At last, the research content innovation. It introduces the concept ofvegetables quality risks, which come into being by the excessive improper use of thechemical pesticide, chemical fertilizer and production technical error in the process of thevegetable production, and empirical analysis the cognition and risk management of thequality risk.