Commercial cattle farming in semi‐arid regions is subject to high rainfall risk. At the same time it is prone to rangeland degradation, and theoretical works suggests that this may be due to inadequate management of the rainfall risk. In this paper, we provide a comprehensive empirical characterization of Namibian commercial cattle farming with respect to rainfall risk, risk management, and sustainability. Our data comes from an extensive survey among 2,119 farmers.
With this data, we examine the critical link between risk, management and sustainability by exploring structural farm patterns with a cluster analysis. Our
results show that the most distinct of the three identified clusters is characterized by high grazing capacity (indicating high sustainability)
and low financial risk management, but not by high or low income. These results conform to the hypothesis that (financial) risk management may achieve income
risk reduction at the cost of a decrease in the system’s sustainability.