Increasing farmers’ resilience to climate change

The management of climate-related risks continues to be high on the agenda of the issues that farmers are grappling with all over the world. This was highlighted during the General Assembly (GA) of the World Farmers’ Organisation (WFO) which was held in Moscow, Russia from 28 to 31 May 2018, at which SACAU was represented by the CEO. To underscore the importance of this issue, a large part of the GA was dedicated to the management of climate risk.

Several take-away lessons emerged during deliberations in several working group meetings, workshops and plenary discussions, and the following are worth highlighting: the starting point or foundation of addressing climate risk should be the application of good agricultural practices – do the basic things first before introducing high tech and more complicated solutions; use of high tech seeds without good agricultural practices only adds to costs; farmers should not shoulder the risk alone, thus there is need for risk sharing along the entire value chain, and the importance of multi-stakeholder partnerships and collaborations in order to effectively address the matter.

It also emerged during the GA that increasing attention is being given to weather-based insurance as one of the tools for managing climate change. Similarly, it is noted that insurance alone is not enough it needs to be accompanied by good agricultural practices.

Other important points were the generally low penetration of crop insurance amongst farmers across the world; the need for farmers to consider the opportunity cost of not insuring and, relatedly, the importance of viewing insurance as some form of investment rather than a cost; the need for a value-chain based approach to the financing of insurance; low levels of insurance literacy amongst the smallholder farmers in particular, as well as the use of insurance as a de-risking mechanism which can also crowd-in finance- insurance makes farmers more bankable and financing more feasible.

Finally, everyone in the ecosystem tends to benefit if farmers are insured against climate change. Finally, SACAU underscored the need to diversify risk across many geographic areas and regions, and commodities/value chains, as a way of addressing the generally high cost of living.