d="p0005">We develop a bioeconomic model to assess drought risk in extensive livestock systems.
dd><dt class="label">•dt><dd>d="p0010">Our findings help to understand how climate risk translates into economic losses.
dd><dt class="label">•dt><dd>d="p0015">We propose the use of Value-at-Risk to assess the severity of drought.
dd><dt class="label">•dt><dd>d="p0020">We find the farm confronts potential economic losses above 23% with 5% probability.
dd><dt class="label">•dt><dd>d="p0025">Scenario analysis shows that stoking rate significantly affects risk exposure.
dd>dl>