The initial assessment of drought-related damages in dryland arable crops, including winter cereals, legumes, and rapeseed, has reached €300 million, as estimated by Agroseguro (Spanish Association of Insurance Entities of Combined Agricultural Insurance). This figure may further increase if the absence of rainfall persists in late producing areas.

This makes the current campaign's drought the largest claim in the history of agricultural insurance, surpassing the previous record of 210 million euros for the 2012 drought (the most severe to date), or the 220 million euros paid in 2022 for the frost damage experienced in early April.

Agroseguro estimates that the affected area will easily reach 1.5 million hectares, which accounts for two thirds of the total insured area. The evaluation process will be conducted simultaneously and in coordination with the harvesting operations: mid-May for the early producing areas and will conclude by the end of July in the late producing areas.

A severe period of lack of precipitation

The 2022-2023 arable crop campaign began with an exceptionally warm autumn and early winter, characterised by widespread thermal anomalies throughout the national territory and very little rainfall during October and November. Despite a wet December, rainfall has been scarce in the first four months of this year.

These conditions have resulted in accelerated development of early plantings (October-November) due to a mild winter and December rainfall. However, these plantings are in phenological stages of maximum water requirements, with depleted reserves and irreversible wilting observed in regions like Andalusia, Extremadura, Castilla-La Mancha, Catalonia, and Aragon. In Castilla y León, despite relatively higher winter rainfall, there is still a minimal soil water reserve in certain regions. However, signs of drought are already evident in a significant portion of the territory.

The risk of drought

Agroseguro emphasises that drought risk is covered by agricultural insurance, including rainfed crops such as winter cereals, legumes, rapeseed, sunflower, wine grapes, olive groves, rainfed beetroot, almonds, and hazelnuts.

It is important to note that the period of recurrence (repetition) of droughts has been reduced in recent years: while in previous decades it was between seven and ten years (1995, 2005, 2012), in the current period it is much shorter (2017, 2019, 2022, 2023). Previously, the 2012 and 2017 droughts held the record for the highest compensation payments to insured farmers through agricultural insurance, with amounts of 210 million euros and 190 million euros, respectively.

In 2022 there were fluctuations with periods of high temperatures, heatwaves, and limited rainfall. However, occasional rains in March and April mitigated the impact of the drought. Despite this, Agroseguro still paid 117 million to insured producers.

Source - https://agroseguro.es