An organisation working to eradicate poverty and hunger, Heifer International has announced its decision to collaborate with Leadway, Olam and PULA to provide insurance for rice farmers against climate change.
According to the country director, Heifer Nigeria Rufus Idris, the project is intended to mitigate climate change-induced losses and restore investors’ confidence in rice farming.
He explained that constant exposure to unreliable weather conditions, new pests and diseases, are part of the challenges that cripple farmers’ businesses as well as discourage agribusiness financiers and investors.
“Most smallholder farmers in Nigeria see insurance as a burden without any benefits,” he said. “When farmers are interested, the cost can be prohibitive, as they must pay for it at the beginning of the farming season when their limited funds are needed for inputs and preparing the land”.
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He maintained that insurance remains an innovative financial solution that can increase the resilience of smallholder farmers in Nigeria while introducing Area Yield Index Insurance (AYII) as the solution to protect farmers from bad yields.
He explained that the scheme which is designed by PULA, an agricultural insurance and technology company, will make farmers aware of the benefits of insurance and increase coverage, attracting more financiers to the sector to improve financial resilience for millions of farmers.
“AYII aims to see that farmers do not suffer loss, ensuring the sustainability of their agribusinesses and incomes,” he said. “AYII has helped smallholder farmers in countries facing climate change risks to increase their resilience to shocks, increase investment by 16 per cent, improve yields by 56 per cent and increase household savings by up to 170 per cent”.
On his part, Olam’s vice president for farming initiatives, Reji George said that the company is committed to supporting the growth of smallholder farmers and part of innovative solutions that improve financial resiliency among Nigerian smallholder rice farmers.
Story was adapted from Thecable.
