Weather Derivatives as A Risk Management Tool for Beverages Manufacturers and Breweries in The UK

Ray, Chiranjib (2005) Weather Derivatives as A Risk Management Tool for Beverages Manufacturers and Breweries in The UK. [Dissertation (University of Nottingham only)] (Unpublished)

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Abstract

The weather has an enormous impact on the cash flow of a company. Weather risk has serious implications for a plethora of industries ranging from energy producers, agro industries, beverages producers to ski resorts and golf courses. According to US Department of Commerce, $1 trillion of their economy is sensitive to weather. An estimated 70 per cent of all businesses are affected by weather that extends across geographic and market borders.

A literature review revealed that the end-users of weather derivatives are mostly energy and utilities companies. Not much has been written about the use of weather derivatives by the beverages industry. This dissertation tries to explore the level of understanding of the management in the beverages sector about the potential merits and de-merits of weather derivatives as a risk management tool. Interviews and a questionnaire are used to analyse the level of awareness about this risk mitigating tool within the industry.

A lot of interesting issues emerged during this research that explained the apparent lack of enthusiasm among the breweries and beverages companies to embrace weather derivatives more wholeheartedly as witnessed in the energy sector.

Item Type: Dissertation (University of Nottingham only)
Keywords: WEATHER DERIVATIVES
Depositing User: EP, Services
Date Deposited: 05 Dec 2005
Last Modified: 28 Sep 2016 21:23
URI: http://eprints.nottingham.ac.uk/id/eprint/20010

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