"Insurance+Futures":Strategies And Strategies Of Agricultural Risk Management

As the foundation of the national economy,agriculture,is concerned with the development of other industries.Economic development has continued to improve in recent years,but the risks in agricultural production and operation have become increasingly prominent,especially in today’s marketization and internationalization process.In particular,there have been large fluctuations in agricultural product prices and a decline in output.Although the relevant departments have adopted a price intervention policy characterized by "token purchases",they have had little effect,the possibility of price risk is extremely high,and the interests of farmers are still not guaranteed.An important part of promoting agricultural development is to prevent risks Whether the income of farmers is stable is also the goal to be considered in agricultural risk management.In order to improve the ability of agricultural risk protection,the CPC Central Committee and the State Council officially issued a document on September 26,2018.The document is titled "Village Revitalization Strategic Plan(2018-2022)." The document clearly proposes to promote the "insurance+futures" model and expand the pilot scope of the model.The "insurance+futures" model for raising agricultural risks has been included in the No.1 document of the Central Government for four consecutive years,which shows that this model meets the risk management needs of China’s agricultural economy.The document also stated that this model has important strategic significance for the realization of rural revitalization.This model formed a closed loop of risk transfer.At first,the risk of farmers was transferred to the insurance company’s compensation risk.The insurance company further transferred the risk to the futures company.The futures company can implement a hedging strategy To minimize the risk."insurance+futures" is a beneficial opportunity for the country’s ongoing rural revitalization strategy to improve the government’s agricultural support and protection system and protect the interests of agricultural economic subjects.At the same time,it will also play an active role in promoting futures and insurance operating institutions to better serve the real economy and increase business scale.As a useful exploration of agricultural risk management,the "insurance+futures" model not only guarantees the continuity and continuxity of relevant policies,but also stabilizes farmers’income.At the same time,the model integrates the pain points of the three parties,which is a process of benefiting the three parties.For insurance companies,the scale of insurance has expanded and the earnings of futures companies have also been improved to a certain extent.But we still have to see that due to the late start,the current exploration of this model in China is not mature enough and in-depth.There is a lack of understanding of insurance companies,futures companies and agricultural producers involved in this model,as well as deficiencies at the relevant international policy level.Only by further in-depth exploration will you find step by step problems in the operation of this model.The main purpose of writing this article is also around this.This article starts with a general approach to agricultural risk management,mainly futures options,insurance,etc.Then use a chapter to focus on the "insurance+futures" model,in order to deepen readers’ impression of this model,this article selects a representative case for in-depth analysis,and finally combines foreign experience in using agricultural insurance and futures markets to control agricultural risks To summarize the shortcomings of the"insurance+futures" pilot model under the current conditions in China,and try to put forward some of my own suggestions to make some useful references for the subsequent implementation.The methods used in this paper are mainly comparative analysis and case exploration.Among them,the case part uses a combination of theory and empirical analysis,and selects the futures price data of Zhenlai County corn futures from 2009 to 2017 for regression analysis.In the past,the analysis of agricultural product price market risk mostly started from a single insurance market or a single futures market,and there were few studies on the combined analysis of the two.This article is aware of this,in order to make the readers better understand the model,this article decided to conduct a systematic analysis of agricultural product price risk.It will be elaborated around four aspects:futures companies,insurance companies,farmers and the national level.Secondly,the article also reviews the hedging theory and option-related theories to help readers better understand the hedging effect of options as a financial instrument on risk.The research on this topic will help to enhance the public’s confidence.It can also play a very good role in publicity and promotion.Through the analysis,it is not difficult to find that China’s "insurance+futures"model still faces many problems,such as the imperfect futures and options market,and the high number of pilot participation,which results in high operating costs.This article puts forward some of my own views and provides references for insurance and futures companies that want to involve this model in the future.