As the UN’s World Food Day approaches on October 16, the executive head of Agriculture Crop at Santam, Daniel Stevens, spotlighted that food security is under threat as the agriculture sector is grappling with increasing challenges.
While access to food is a basic human right, a report by the World Bank cited food security as one of the critical challenges affecting the global population this year.
Therefore, food and nutrition security are enlisted among the eight global challenges that urgently need to be addressed at scale, which mobilised $45 billion in resources to tackle issues and protect livelihoods worldwide
Locally, Stats SA reported that 15% of the country’s population is bearing the brunt of hunger and malnutrition in 2023, while over one-quarter of South African households faced complex access to food.
Although the effects of Covid-19 left a dent on the food market, Stevens indicated food insecurity continues to spiral due to climate change, an increasing population and a harrowing poverty rate.
Following the severe weather spells in the past weeks in parts of the country, Stevens reiterated that the agriculture sector – farmers – are battling hectic climate changes, further putting food security under siege.
“Long-term temperature shifts and weather patterns continue to create an increasingly hostile agricultural environment characterised by natural disasters like heavy rain, hail, and drought which can cause tremendous damage to both crops and farm infrastructure,” said Stevens.
He stated the insurance industry is making provisions for farmers to build climate change resistance in order to protect their businesses and harvest, whilst preventing food decline.
“Insurance is an important risk management tool. Agricultural insurance can protect farmers in the agricultural sector by covering losses from adverse weather events. This can help farmers to maintain their income level and to continue farming even if a harvest is lost.
“Agricultural insurance can also assist farmers to access credit markets, which can provide financing for food production and act as a catalyst for economic growth. For example, by enabling farmers to buy new equipment, fertiliser and seed thus increasing their output,” said Stevens.
With frost being a high risk in the country, in some areas in South Africa, it is not insurable.
Hence, Stevens stressed that insuring one’s crops is imperative to mitigate risks that threaten farmers’ businesses when faced with inclement weather.
“As one of the most risk-prone industries in the world, the agriculture insurance industry realises the importance of addressing the effects of climate change, with solutions like crop insurance providing farmers with an edge against climate, environmental, and other risks.
“When heavy rains and hail cause damage to crops before they can be harvested and sold, crop insurance provides the resources that enable farmers to plant the following season. Settlements for weather damage allow farmers to protect their livelihoods,” he said.
Furthermore, the agriculture industry is currently in financial strain as farm debt sharply increased above R200 billion.
“This increase in debt in the agricultural sector has translated to an increase of 6% since 2019. While it is purported to be well balanced in relation to the value of agricultural assets, the immense financial pressure faced by farmers can not be underestimated,” said Stevens.
“Crop insurance curtails these pressures by offering farmers financial protection against yield losses. Without this much needed risk-based product, many farmers will not settle their loans and will be prone to liquidation and be forced out of farming altogether which will be a huge setback to their livelihoods.”
He urged farmers to receive as much support as possible not only to protect their businesses’ sustainability, but also to ensure a clinch on the country’s food security.
The Star
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