All such instruments focus on reducing price volatility
and, in turn, decrease downside risk at the farm level.
However, these instruments also limit entrepreneurial
freedom to a smaller or a larger extent. The AW concepts
currently present in the Netherlands already use
particular forms of vertical coordination. For example,
one of the concepts guarantees a feed profit for farmers;
in other words, if the feed price increases producer
price increases accordingly, and vice versa, sets requirements
on flock size among others, and integrates the
process from transportation through slaughter to selling
products to the retail channel (KemperKip, 2013).
Such risk management instruments could increase the
willingness of farmers to convert to AW improving production
systems. However, in addition to farmers possibly
expressing of some degree of risk aversion, Dutch
farmers consider themselves entrepreneurs and want to
keep their freedom of choice (Van Horne, 2007). The
extent to which farmers perceive these instruments as a
motivation to join a concept and from what point these
instruments become a limiting factor for farmers could
differ at an individual level and needs to be further
studied.