28.01.2016

Canada - Fire blight reimbursement for Nova Scotia's apple and pear growers

Last night, Tuesday 26 January, it was announced that up to $2.69 million will be made available to Nova Scotia fruit tree growers to help them financially recover from an outbreak of fire blight in trees that followed post-tropical storm Arthur in 2014. The money will be dispersed over 5 years, with the federal government covering 60 per cent of the cost and the Nova Scotia government covering the rest. Andrew Parker, president of the Nova Scotia Fruit Growers’ Association, said in a press release, “This will help the Nova Scotia apple industry reinvest money to continue to produce high-value fruit and capitalize on the strong export market the industry has developed.” He estimates fire blight will likely cost growers $20 million over seven years. Fire blight is a disease that affects apple and pear trees; an estimated 95 per cent of orchards in Nova Scotia were affected in some way by the fire blight after the 2014 storm. It's a disease that can result in the loss of branches and tree structure. In severe cases, when the bacteria progresses into the trunk or infects the rootstock, entire trees can be killed. Robert Piell says his orchard, Town Plot Orchards in Port Williams, lost 4,000 trees. "It was demoralizing. It was hard to get up in the morning in those days," said Piell. ​The best farmers could do was spray, treat with copper, and remove infected plants. ​The fire blight initiative will pay to replace trees, get the outbreak under control and minimize the potential for damage in the future. It's being delivered under the AgriRecovery Framework, which lets the government respond to unforeseen natural disasters that result in huge costs for producers. Sources - freshplaza.com

28.01.2016

USA - Driverless Tractors and Drones to Be among the Key Applications for Agricultural Robots, According to Tractica

The demand for agricultural robots is being driven by the global trends of population growth, increasing strain on the food supply, availability of farm labor, the cost of farm workers, shrinking farmlands, climate change, the growth of indoor farming, and the automation of the agriculture industry. According to a recent report from Tractica, the applications for agricultural robots will be diverse and will include driverless tractors, unmanned aerial vehicles (UAVs), materials management, field crops and forest management, soil management, dairy management, and animal management. The market intelligence firm forecasts that the worldwide market for agricultural robots will increase from $3.0 billion in 2015 to $73.9 billion in 2024. Among the types of robots used for agricultural purposes, driverless tractors will generate the lion’s share of revenue ($30.7 billion by 2024) while agricultural drones will be most prevalent in terms of unit shipments (411,000 by 2024). “The agricultural robotics market is in its early stage of development,” says research analyst Manoj Sahi. “For sustainable growth in revenues, industry participants will need to pursue truly innovative technology and clear value propositions. The agriculture market is looking for more efficient solutions in terms of time, labor, and energy, rather than perfect ones.” Sahi adds that large companies should focus on the key areas that need infrastructural changes in agriculture, instead of building products for niche agricultural issues. Tractica’s analysis indicates that medium-size companies and startups should look for opportunities to fit as complementary players with the large companies. Success in the market, says Sahi, will require the development of a highly collaborative and cooperative industry ecosystem. Tractica’s report, “Agricultural Robots,” examines global market trends for agricultural robots and provides 10-year market sizing and forecasts for agricultural robot shipments and revenue during the 2015 to 2024 timeframe. The report focuses on market drivers and market challenges, as well as assessing the key technology issues that will influence market development. In total, 42 key and emerging industry players are profiled. Market forecasts are segmented by world region and application type. An Executive Summary of the report is available for free download on the firm’s website. Source - businesswire.com

27.01.2016

USA - Cargill Joins Wells Fargo, Deere in Retreat From Crop Insurance

The U.S. crop insurance market has been abandoned by some of its largest companies as lower agricultural prices crimp revenue, and uncertainty about federal aid clouds the business’s future. Cargill Inc., the largest privately held company in the U.S., reached a deal last month to sell a crop insurer. Wells Fargo & Co., the largest bank by market value, also announced a retreat, as did seed provider Monsanto Co. and tractor maker Deere & Co. “It isn’t easy money,” said Mike Foley, chief executive officer of the North America commercial division for Zurich Insurance Group AG, which agreed in December to pay as much as $1.05 billion for Wells Fargo’s Rural Community Insurance Services, one of the largest U.S. crop insurers. “It may not be something you want to do if it isn’t part of your core business.” The industry had an underwriting loss of $1.3 billion in 2012 and gains of just $657 million in 2013, the most recent years for which figures are available, according to a study from the Congressional Research Service in August. That compares with annual profit of more than $1 billion in the five years through 2011. Volatile crop prices, pressure on government subsidies and the potential for extreme weather tied to climate change have added risk for insurers, said Keith Coble, an agricultural economist at Mississippi State University. Bumper harvests have sent corn, the biggest U.S. crop, to less than half its 2012 peak, ratcheting down the premiums farmers pay to insure against loss. Other crops have also seen steep price declines. Lean Times “It’s just not as lucrative a business as it used to be,” Coble said. “Companies don’t want to bother with it in the lean times if it’s not part of their core business.” Cargill’s departure from crop insurance will help the company concentrate on its main businesses like grain shipping and trading, spokesman Mark Klein said in an e-mail. Wells Fargo, the biggest U.S. agricultural lender, said that getting out of crop coverage helps the insurance operation focus on its role as a middleman between banking clients and underwriters. Cargill had been in the insurance business since 2007, and Monsanto added crop coverage with the 2013 purchase of Climate Corp. RCIS was part of Norwest Corp. before that bank’s 1998 merger with Wells Fargo. The sales aren’t a sign of long-term industry turmoil because food demand will inevitably rise, and Wells Fargo didn’t have to settle for a fire-sale price, according to Coble. But the divestitures may show that crop insurance, like agriculture itself, is best left to the specialists, he said. When results slump, “you see ownership revert to people with the patience and ability to see things through,” the professor said. Ace, Aspen The biggest players in the industry in recent years have been Wells Fargo’s RCIS and Evan Greenberg’s Ace Ltd., which took the Chubb name this month after buying its long-time rival and becoming the world’s largest publicly traded property-casualty insurer. Other companies that have been expanding in the crop market count insurance as their primary business -- even if they don’t all enjoy the decades-long relationships that companies like Deere have with farmers. AmTrust Financial Services Inc. agreed last year to add the Monsanto unit. Bermuda-based Aspen Insurance Holdings Ltd. announced a deal Jan. 20 to buy AgriLogic Insurance Services. Silveus Insurance Group, which has an agricultural focus, completed the purchase of the Cargill unit this month. Farmers Mutual Hail Insurance Co. of Iowa added the unit from Deere, which said in late 2014 that it was exiting after eight years in crop coverage. Crop insurance protects farmers against weather-related setbacks or lower-than-expected revenue. Policies bought from private insurers have become the main form of federal farm aid, as traditional government crop supports have been replaced by subsidies that cover 62 percent of premium costs on average. The U.S. Department of Agriculture also covers operations expenses for companies that serve farmers. The cost can be steep. Annual federal spending reached a record $14.1 billion after a drought in the U.S. Corn Belt in 2012 fueled losses. President Barack Obama and House Speaker Paul Ryan both have proposed limiting the risk for taxpayers. And Congress last year approved a $3 billion cut to the federal program, which was subsequently reversed after outrage from rural lawmakers. Still, "I don’t think companies can be comfortable that the kind of support they’ve received will remain the same," said Craig Cox, a senior vice president based in Ames, Iowa, for Environmental Working Group, which seeks to cut crop-insurance subsidies. Source - bloomberg.com

27.01.2016

Philippines - Dry spell losses in Negros Occidental climb to P239M

Prolonged dry weather associated with El Niño has depleted many water sources in Negros Occidental, including this small water impounding project in Barangay Man-uling, Cauayan town. (Contributed Photo) DAMAGE and production losses in crops and livestock in Negros Occidental caused by the persisting dry spell continue to increase, reaching P239.25 million as of Tuesday, January 26, Capitol reports showed. Sugarcane, the main crop of Negros Occidental, incurred a damage of P163.308 million, the Sugar Regulatory Administration (SRA) reported. The figure covers six milling districts in 15 local government units (LGUs), affecting 7,909 planters, with a total affected area of 7,544.09 hectares, or 15.4 percent of the 48,975.32 hectares standing crop area. These milling districts include the Southern Negros Development Corporation (Sonedco) and Dacongcogon, Ma-ao Sugar Central, Biscom Inc., Central Azucarera de La Carlota, Sagay Central Inc., and Lopez Sugar Corp. For rice, corn, and high-value commercial crops (HVCC), a progress report from the Office of the Provincial Agriculturist (OPA) showed P73.81 million in damage and production losses. Affected are 2,472.12 hectares owned by 2,591 farmers in 72 barangays of 12 LGUs. In the fourth district, 18 barangays in Pontevedra, La Carlota City, San Enrique and Bago City posted a damage of P20.08 million, affecting 302 rice farmers with an area of 393.27 hectares. Thirty-one barangays across Hinoba-an, Sipalay City, Cauayan, and Kabankalan in the sixth district listed P22.98 million in losses, hitting 1,447 palay farmers in an area of 1,308.27 hectares. The biggest crop damage and production losses of P30.75 million were recorded in the fifth district, covering 23 barangays in Hinigaran, Moises Padilla, Binalbagan and Isabela. The damage spread over 770.58 hectares, affecting 842 palay, corn, and HVCC farmers. Provincial Senior Agriculturist Dina Genzola said the rain brought by the northeast monsoon over the past two days has significantly penetrated and helped crops in northern Negros. Genzola said the volume of rain is enough for affected crops in the north to recover, but “the southern part still needs water.” Livestock The extreme heat intensified by El Niño has caused P2.13 million worth of damage to livestock and poultry animals in 22 LGUs, based on the latest report of the Provincial Veterinary Office (PVO). The figures cover P766,965 damage to swine; cattle, P30,800; carabao, P306,000; goat, P98,080; sheep, P46,500; broiler, P423,596; layer, P20,700; free-range chicken, P240,320; gamefowl, P125,000; Pekin duck, P14,850; duck, P33,600; and egg production, P16,200. Dr. Ryan Janoya, head of Animal Health and Meat Inspection Division, said Tuesday that most of these animals died due to extreme heat and lack of grasses to eat, such as the case of the 12 carabaos in Escalante City, La Castellana, Isabela, and Cauayan. Swine, which was the most affected, mainly suffered abortions due to severe heat, Janoya said. The PVO is validating who among the affected animal raisers are enrolled in the livestock insurance program to avail themselves of claims from the Philippine Crop Insurance Corp. (PCIC), he added. Notices of loss A total of 765 farmers have so far filed notices of loss with the PCIC due to damage and production losses. Genzola said these farmers, covering 886.24 hectares of rice, corn and high-value commercial crops farms, are just part of the 2,591 dry-spell-affected farmers in the province. She added that farmers who filed notices of loss are enrolled in the Negros First Universal Crop Insurance Program (NFUCIP) of the Provincial Government, thus they may avail themselves of the P17,000 claims per hectare of farms damaged and affected by calamities like El Niño. Under the NFUCIP, the enrollment premium per cropping season is P840, of which only P340 is the counterpart of the farmer-enrollees, while the remaining P500 is shouldered by the Provincial Government as loan. Adjusters from the PCIC are conducting assessments to determine the amount of indemnities that can be claimed by affected farmers, Genzola said. OPA records showed that in 2015, about 14,000 premiums were already covered by NFUCIP with a total area of more than 13,000 hectares since the program started in 2011. Of the total farmers enrolled, about 7,500 have already received indemnity claims of not less than P32 million for about 8,000 hectares of damaged crops. Source - sunstar.com.ph

27.01.2016

Australia - Rob Katter pushes multi-peril crop insurance

QUEENSLAND MP Rob Katter is urging Federal Agriculture Minister Barnaby Joyce to advance a $30 million commitment on establishing a ground-breaking Multi-Peril Crop Insurance (MPCI) scheme. The Federal Coalition’s Agricultural and Competitiveness White Paper released last July promised $30m to help with implementing a MPCI. It comprised $2500 from the Commonwealth with potentially matching contributions from State governments to conduct audits of five-year production figures, to assess individual producers’ suitability, for a MPCI scheme. That move was welcomed by farm industry stakeholders, as a good first step to incentivise commercial insurers to enter a new product market. But with more than six months passing since the White Paper’s release, Mr Katter has now written to Mr Joyce pushing Queensland’s claims to receive $10m of that funding. He said it was up to the minister’s discretion to decide how the remaining funds were spent from the $30m allocation – but he wanted to see an announcement in the next couple of months on how it would be allocated to Queensland. The Katter's Australian Party MP and the son of party founder Bob Katter is Chair of the Queensland Rural Debt and Drought Taskforce that’s currently investigating financial difficulties confronting the State’s rural and farming communities. He’s requested a meeting with Mr Joyce to also raise concerns ventilated during the Taskforce process and prioritise ways of delivering a commercially viable MPCI scheme, starting with grain farmers and extending it over time to other commodities. “It can run on its own two legs once it’s up and running but the role for the government is to get involved in the early stage to establish it and get the critical mass from the industry that makes it viable for the insurers themselves. “And once you can establish it in the grains industry which is probably the low-hanging fruit, there’s no reason why we should not be trying to apply it to other agricultural pursuits.” Last week, National Farmers Federation President Brent Finlay said his lobby group also wanted government to adopt a whole of farm insurance program on production costs, not just a MPCI program. “It needs some support in the early days but that may be paid back in spades by acting early, getting a product in place, instead of hitting the wall in every drought and then the government has to find substantial drought assistance,” he said. Mr Katter believes the new insurance scheme would invoke a generational change by “smoothing out all of the snakes and ladders in agriculture; the market volatility and variable weather patterns”. “It’s a part of an elegant solution to try and fortify agriculture and has been done all around the world,” he said. “It solves a lot of issues, gives more security to the government and reinvigorates economies. “It has an element of economic prosperity for the towns; it has a security feature for the government and long term viability and security for agriculture in general.” Mr Katter said with $3 billion spent on drought support programs via the former Exceptional Circumstances policy, such government funding could now underpin a MPCI scheme, to manage risks of droughts, floods or “whatever failures in agriculture”. He said an ideal outcome was for the federal government to underwrite the insurance scheme’s establishment – but the $30m would assist with the initial data collection which was industry’s “big hurdle”. A spokesman for Minister Joyce said a meeting with Mr Katter had been agreed to and further details on delivery, this season, of the $29.9m farm insurance and risk advice grants announced in the White Paper, would be released soon. “The government has been consulting with key stakeholders on the implementation of this initiative and will be happy to brief the Queensland Government’s Rural Debt and Drought Taskforce once details are announced,” the spokesperson said. Mr Katter said the data collection process had already started in NSW and the “same love needs to be shown for Queensland” by providing the $10m he’s requesting. He said that funding could be allocated to the State government and program delivery then facilitated through the local Agriculture Department and QRAA disaster financial assistance delivery agency. At the release of the White Paper, Victorian Liberal MP Dan Tehan warned against the government underwriting any MPCI scheme saying Australian farmers were not over-reliant on government subsidies, like competing farmers in the US or Europe. Source - queenslandcountrylife.com.au

27.01.2016

Are Solar-Powered Drones the Future of Sustainability?

With technology leaping forward every day, many companies are seeking new ways to provide efficient, sustainable, and effective solutions. Their answer? Solar powered drones. As drone technology has improved, their accessibility has increased dramatically as well. Consumer models start as low as $50. However, drones are also becoming an incredibly useful production tool. Solar-powered drones in particular are being used increasingly in agriculture, for monitoring climate change and environmental effects, and in delivery services. Sustainable Farming According to MIT Technology Review, low-cost drones are increasingly used by farmers to monitor crops. In the past, farmers would often employ manned aircraft at a cost of up to $1,000 an hour to fly over crops and observe patterns in irrigation, erosion, and pest and fungal infections. Now, many farmers are turning to solar-powered drones, which can be bought outright for the same $1,000. These drones fly just meters above their crops, offering a close-up view and crop data that’s never been utilized before. Since the drones cost significantly less than a manned aircraft to use and maintain, farmers can fly over their crops daily, weekly, or monthly, essentially creating time-lapsed images. These images allow the farmers to accurately track crops and monitor any changes. With the rise in data-driven agriculture, this ability to gather information quickly and sustainably allows farmers to optimize growth and minimize labor. Oliver Wyman claims that precision agriculture will eventually make up 80 percent of the Unmanned Aerial Vehicle (UAV) industry by 2035 and could reduce fertilizer use by up to 40 percent. Environmental Preservation Increasingly, solar powered drones are being used in conservation and environmental preservation efforts. AeroVironment’s “Puma” drone is the first to be cleared by the Federal Aviation Administration (FAA) for use. The quiet, low-flying drone is currently used for oil pipeline monitoring and environmental monitoring in sensitive ecosystems. “Puma” is also monitoring ice floe activity and has been used to record and document the ecological impacts of oil spills. With a significantly lower carbon footprint, lower noise level, and low profile design, “Puma” is able to observe while creating less of an environmental disruption in the area. Insitu, a subsidiary of Boeing, is also creating drones specifically designed to monitor power lines, track environmental changes, and assist in fighting forest fires. Global Distribution In addition to their use in global sustainability efforts, solar powered drones are gaining traction in the delivery and service provider industries. Rwanda is set to receive the world’s first droneport, with ground being broken this year, 2016. The droneport will allow rural areas to receive key supplies like medicine and food, with some drones carrying payloads of up to 100 pounds. Companies like Amazon Prime are seeking to employ drones in their delivery services. In 2014, Amazon launched Prime Air, delivering packages via drones in 30 minutes or less. Amazon’s solar powered drones will reduce the company’s fuel consumption significantly. Services in Rural Areas Beyond sustainably delivering goods, businesses use solar powered drones to provide services, such as Internet, in rural areas. Modern Internet lines can cost up to $40,000 a mile. However, companies like Facebook are developing ways to provide Internet without costly lines and physical infrastructure. Facebook’s current project, the “Aquila” drone, would provide Internet to a large rural area without any physical lines. The drone is designed to run solely on solar power and can fly up to three months at a time. Facebook plans to create a network of such drones, creating a vast area of wireless service. The drone would operate up to 80,000 feet in the air, well above commercial airlines and the hazardous effects of weather. Other companies, such as Titan Aerospace, are on the heels of Facebook and have their own Internet-providing drones in the works. Much like satellites, solar powered drones offer a sustainable way to provide goods and services to remote areas quickly and effectively. Currently, satellites provide wireless Internet to huge areas of rural land. They survey and report on terrain changes and environmental conditions, as well as weather patterns. And because they have a low reliance on fossil fuels, both satellites and solar powered drones present an eco-friendly choice for a variety of services, at nearly the same cost as other, less eco-friendly options. Source - tech.co

27.01.2016

USA - Onion, cabbage insurance deadline Feb. 1

The Feb. 1 crop insurance deadline is fast approaching for onion and cabbage growers in the Pacific Northwest, the USDA Risk Management Agency says. Feb. 1 is the deadline for Northwest farmers who produce onions and cabbage to buy crop insurance. According to the USDA Risk Management Agency, growers must apply for coverage for spring-planted onions in Idaho, Oregon and Washington and cabbage in Oregon and Washington before the end of January. For the 2015 crop, roughly 93 percent of onions in Washington were insured, with comparable coverage in Idaho and Oregon, Jo Lynne Seufer of the RMA’s Spokane office said. No cabbage was insured. Seufer said the risk may not be significant for growers who raise cabbage in Eastern Washington and the Willamette Valley in Oregon. Policyholders who wish to make changes in their coverage also have until the sales closing date. In the meantime, the final date to apply for whole-farm revenue protection and insurance coverage on all other spring crops is March 15, except for wheat in counties with fall and spring-planted types. According to an agency press release, RMA changed the whole-farm revenue protection to include improvements for beginning farmers and ranchers, livestock producers and producers whose operations are expanding. More beginning farmers and ranchers can participate because the agency requires three historical years and farming records from the past year. Any beginning farmer and rancher may qualify by using a former farm operator’s federal farm tax records if they have assumed at least 90 percent of the farm operation. Producers can now insure up to $1 million worth of animals and animal products, according to RMA. The agency also increased the cap on historical revenue for expanding operations to 35 percent so growing farms can better cover growth in the insurance guarantee. Seufer said the agency is fielding inquiries from farmers curious about whole-farm revenue protection, wondering whether protection against down-side price risk is what they need. She encouraged farmers to speak with their crop insurance agent as soon as possible. “The more time they have to work with their agent, the better,” she said. Source - capitalpress.com

27.01.2016

Taiwan - Cold wave causes agricultural losses up to US$12.07 million (update)

Fourteen cities and counties have reported agricultural losses since Jan. 22 caused by the worst cold snap to hit Taiwan in decades, and the losses had reached NT$404.81 million (US$12.07 million) as of 5 p.m. Tuesday, according to the Council of Agriculture (COA). The biggest losses were in Tainan in southern Taiwan, which had so far reported losses of NT$232 million, or 57 percent of the total, COA Secretary-General Tai Yu-yen (戴玉燕) said. Yunlin and Miaoli counties also suffered substantial losses -- NT$78.81 million and NT$47.09 million respectively, Tai added. Chiayi County, which complained that the central government was "absent" during the crisis, reported NT$21.58 million in agricultural and fishery losses According to COA statistics, crop losses had accumulated to NT$77.39 million as of Tuesday. A total of 1,583 hectares of crops were damaged, with strawberries hit the hardest, followed by ginger, oranges, bell fruit and pear flower-budwood. The loss of strawberry alone, covering 154 hectares, was estimated at NT$22.99 million. Fishery losses had reached NT$327 million, mainly caused by die-offs of milk fish, groupers, common oriental clams and tilapia in aquacultural farms, the statistics show. Pig and poultry farmers suffered a loss of NT$330,000. In January, 2005 when a cold snap hit Taiwan with snow in some places, the total agricultural losses reached NT$650 million. Tai said that although the cold wave damaged some farming products, leading to a moderate rise in vegetable prices in domestic markets, she anticipated that the current price fluctuation is nothing but a short-term phenomenon. She urged consumers to refrain from panic shopping, even though the traditional Lunar New Year holiday is soon to come. With the temperatures climbing, green crops will grow fast, Tai said. Also, although some fruits were damaged during the cold spell over the past few days, there are other fruits like sugar apples and guava, whose outputs can meet demand, she said. Source - focustaiwan.tw

26.01.2016

USA - Crop Insurance Premiums: Not a Place to Cut Costs

In this article, Revenue Protection (RP) premiums are compared for 2015 and 2016. For the same projected price and volatility, premiums will be higher in 2016 as compared to 2015. Premium increases lead to questions as to whether farmers will lower coverage levels to lower premiums. Lowering coverage levels would go against the trend in recent years of increasing coverage levels. Lowering coverage levels also would expose farmers to higher revenue risks. In my opinion, these higher risks counter any cost savings from lowering coverage levels on most farms. As a result, farmers likely should continue to purchase crop insurance at high coverage levels. Revenue Protection Premiums for 2016 Table 1 shows a comparison of 2015 and projected 2016 premiums for Revenue Protection (RP) in three Illinois Counties: DeKalb, Champaign, and Saline Counties. DeKalb County is in northern Illinois, McLean County in central Illinois, and Washington County is in southern Illinois. These per acre premiums are for corn given that 100 acres are insured using an enterprise unit. The Actual Production History (APH) and Trend-adjusted APH yields are set near the average for each county and are shown in the header of Table 1. Click Image to Enlarge A $4.15 projected price and .21 volatility are the parameters for 2015. These parameters are used to generate both 2015 and 2016 premiums. Using the 2015 projected price and volatility to generate 2016 premiums allows examinations of how underlying rate changes made by the Risk Management Agency (RMA) impacts premiums. All 2016 projected premiums are above 2015 premiums, with many of the changes being more than 10%. At an 85% coverage level, the RP DeKalb County premium is 11% higher for 2016 ($16.51 per acre in 2015 compared to $18.31 per acre in 2016). Champaign County is 8% higher ($15.97 per acre compared to $17.23 in 2016). Saline County premium is 16% higher ($50.37 per acre in 2015 compared to $56.28 per acre in 2016). Premiums for 2016 will vary from those shown in Table 1 as the projected price and volatility will differ from 2015 levels. The 2016 Crop Insurance Decision Tool, a Microsoft Excel spreadsheet, can be used to generate alternative premium estimates (download available here). Both the projected price and volatility have impacts on premium: Lowering the projected price from $4.15 to $3.90 (the current level of December futures contract) would lower the 2016 RP 85% premium in DeKalb County from $18.31 per acre to $17.20 per acre. Lowering the volatility from .21 to .20 would lower the 2016 RP 85% premium in DeKalb County from $18.31 per acre to $17.38 per acre. This change holds the projected price at $4.15 Lower both the projected price to $3.90 and the volatility to .20 would lower the 2016 RP 85% premium in DeKalb County from $18.31 per acre to $16.33 per acre. Under this scenario, the 2016 premium would be below the 2015 premium ($16.51). Obviously, the final projected price and volatility factors will influence whether final 2016 premiums are above or below 2015 premiums. Crop Insurance Use in 2015 In 2015, RMA reported that 10.155 million acres of corn were insured in Illinois, with insurance being used on 87% of the planted acres in Illinois. By far, the most used product in 2015 was RP, with 76.3% of planted acres insured with RP (see Table 2). The next largest used product was Area Risk Plan (ARP) accounting 5.7% of use. Click Image to Enlarge Both RP and ARP are revenue insurances with guarantee increases, suggesting that farmers prefer these products over revenue insurances without guarantee increase or yield insurances. Moreover, these products are extensively used at high coverage levels. High coverage levels of these two revenue insurance products with guarantee increases accounted for insurance on 77.9% on planted acres: RP at 75% and higher coverage levels account for 72.4% of planted acres, and ARP at a 90% coverage level accounts for 5.5% of planted acres. A significant trend has been the increase in use of these two revenue products at high coverage levels. Revenue insurances were introduced in 1997. Use has climbed from near zero use in 1997 to around 68% in 2014 and 2015 (see Figure 1). Click Image to Enlarge Use in 2016 One question is: Will farmers continue to use high coverage level revenue insurance with guarantee increases or will farmers back off and lower coverage levels? Farmers may wish to lower premiums as a way to reduce non-land costs, a strategy that needs to be followed in order to achieve profitability. In my opinion, crop insurance is not the area to look at cost reductions. There is still considerable downside price risk and downside revenue risk. For example, a combination of near average yields and much lower prices would result in extremely low revenues. While crop insurance cannot guarantee revenues exceed costs this year, crop insurance can limit losses. If not already at high coverage levels, farmers may wish to consider increasing coverage level for 2016. Gary Schnitkey Source - agfax.com

26.01.2016

Africa - Poor awareness limits insurance coverage

The ideal situation is that growth in insurance coverage should not lag too far behind economic growth. Commissioner of Insurance and Chief Executive Officer of the Tanzania Insurance Regulatory Authority (TIRA), Mr Israel Kamuzora, said low level of penetration and awareness of insurance is attributed to both cultural and historical factors. Despite the fact that insurance industry has been growing at a healthy rate of over 20 per cent annually for over a decade, its penetration level is just 1 per cent of the country’s GDP against the world average of 2.3 per cent. In 2014, GDP registered seven per cent growth implying that incomes are rising therefore individuals and corporate will increasingly seek insurance to protect their expanding income base. The growth and penetration of the insurance sector should have subsequently mirrored the expansion of the GDP. The wide lag between our GDP growth and insurance reach subsequently means that there are vast opportunities for growth of exposures and income in the insurance sector in Tanzania. The majority of insurance products in the country are focused on traditional markets, serving the needs of large corporates and high income individuals, with limited product development at the lower income end of the population. While corporate are an important business segment in growing revenues, the rising population requiring life, health and other general insurance products provides additional opportunities for growth in the industry. “Most of our societies understand the need to transfer cost from an individual to the whole community but they accept to do this only after the catastrophic event has already occurred, not earlier and certainly not for a fee; it is entirely voluntary,” he said. Making contributions is the panacea for every tragedy, every socio-economic challenge. Medical bills are a classic example. People raise money for medical bills after the person dies in hospital, not before. The system is inherently expensive, very inefficient and leaves those involved traumatized. The notion that people can contribute before the tragic event happens is alien to most of the societies but the insurance industry needs to invest heavily to that form of civic education. Societies, on the other hand, are created from cultural framework because culture is man-made creation which informs the coming together of individuals in order to make a society. Many individuals in Tanzania and indeed in the African continent have suffered from damage to the environment or loss of resources caused by natural and man-made disasters. Catastrophes around the continent including drought, increases vulnerability of many countries and their population. Risk occurrence is a phenomenon that affects human lives. Risk avoidance helps individuals to cope with the tragedies of life. For example, farming in developing countries is exposed to a variety of income uncertainties ranging from fluctuation of prices and unpredictable weather patterns, thus holding back efforts to lift people out of poverty. It is well known that such uncertainties induce substantial income risks, and these can be detrimental to small or poor producers in developing countries. Such uncertainties have been blocking about 80 per cent of the population depending on farming from accessing lending houses. But agriculture sector will register notable progress when the proposed agriculture insurance that will provide solution to number of uncertainties becomes a reality. The absence of crop production credit is a bottleneck to access and adoption of improved farming technology, certified seeds, fertilizers and plant protection chemicals. Agriculture insurance has shown to be a way of increasing small farmers’ access to seasonal loans in many countries and may have similar role to play in the country. “Crop and agriculture insurance is fundamental to the national economies as adverse weather events like drought, floods and storms that cause heavy losses to farmers pose major threat to production and reduced farmers’ incomes,” he said. The insurance industry needs to take a long hard look at new technologies to see how they could help change cultural mindsets, raise the fear of risks, and facilitate transfer of risks, institute insurance contracts, premium payment and claims settlement. The protection component, the risk taking business, may be hard sell Tanzanians. However, beyond these innovations more needs to be done. The insurance industry has no excuse either for not securing significant funds from those who are keen on savings accounts. Source - dailynews.co.tz

26.01.2016

Colombia - Agriculture severely threatened by HLB

The HLB disease could cause the end of Colombia's citrus industry at any time, according to Roberto Jaramillo, president of the national federation of growers, who also said that they have been waiting two years for the Government to provide the necessary devices to monitor and prevent the spread of the vector that transmits the pest. The HLB was identified in two municipalities of La Guajira, hence the concern, because if it spreads, it could cause the loss of some 400,000 jobs in four years and put an end to the production of 18,000 Colombian farms, i.e., some 83,000 hectares of citrus fruits. Citrus growers in the region claim that the lack of rainfall has led to a drop in the production, and that prices have increased by up to 50%. The hope for this sector, as well as for fruit and vegetable growers in general, is for some rainfall to be registered over the next two months so that the impact on the upcoming harvest can be reduced. Source - freshplaza.com

26.01.2016

India - Farmers demand compensation for crop loss in Ramnad

Farmers from Thiruvadanai block thronged the Collectorate here on Monday carrying bunches of withered paddy crops and appealed to the Collector to help them to get compensation for the loss of crops. The farmers said more than 150 farmers, who had cultivated paddy on 1,500 acres in Vettukulam and surrounding villages in Sozhandur region, lost their crops for want of water at the terminal stage. They cultivated 110 days-old paddy varieties such as IR 36 and CO 47 but could not save them for want of water at the terminal stage. The northeast monsoon was fairly good in several other parts of the district but totally failed in the Thiruvadanai region, K. Ramadoss, a farmer, who had been in cultivation for nearly 20 years, said. Paddy cultivated on all the 1,500 acres withered, he said and urged the district administration to pay a compensation of Rs.25,000 per acre. Stating that most of the farmers had insured their crops, A. Sandhiyagu, another farmer from the village, said the district administration should also help them to secure the crop insurance, besides providing them drought relief. The farmers had spent about Rs.20,000 per acre and they would be able to take up cultivation in the next season only if they were adequately compensated, the farmers said. Source - thehindu.com

26.01.2016

Big Business Wins, Taxpayers Lose In Crop Insurance Industry

Huge multinational corporations are selling off their crop insurance businesses. The reason, according to the industry, is that business is just too bad, despite billions in federal subsidies. What they don’t point out is other multinationals are snapping up those same companies. Late last year, Wells Fargo sold its crop insurance business, Rural Community Insurance Services, to Zurich Insurance Group. Zurich, one of the largest insurance companies in the world, agreed to pay up to a staggering $1.05 billion for the insurance company. Who’s going to pay a billion bucks for a company that isn’t profitable? Just this week, Aspen Insurance Holdings – a holding company with more than $10 billion in assets – snapped up AgriLogic Insurance Services for an undisclosed price. Are we supposed to believe they’re shopping for a business that is losing money? The truth is, crop insurance companies are guaranteed a profit, through a special deal they get from the federal government. These companies had an average rate of return over 14 percent between 2004 and 2013, showing that profits are alive and well. Who’s footing the bill? You and me. American taxpayers’ dollars are flowing to some of the wealthiest companies in the world, many of which are headquartered outside the U.S., as EWG’s Crying Wolf analysis shows. These two new parent companies are more of the same – both rich, both overseas. Zurich Insurance Group, headquartered in Switzerland, is currently worth more than $32.5 billion and had a 2014 net income of $3.9 billion. Aspen Insurance, headquartered in Bermuda, has a net worth of over $2.7 billion and 2014 net income of $355.8 million. Chris O’Kane, the current CEO of Aspen, received over $7.7 million in compensation in 2014 alone. Wealthy corporations are not in business to buy companies that aren’t profitable. The federal crop insurance program guarantees that big business wins while taxpayers lose. Source - ewg.org

26.01.2016

Italia - Drones are Bringing the Internet to Rural Farmers in Sicily

Italian-based Catanese R&D startup Heli-Lab has launched a drone project that features the use of drones to bring the Internet to areas in Sicily where there is no connection. The remote-controlled drones are employed for a wide range of activities, namely for agricultural, industrial and insurance purposes. The tasks delegated to the drones are different and increase with the ability to equip the APR-specific technology. On the side, the drones are also transformed into real PCs and hot spots, thus collecting a large amount of data in flight and transferring them to the cloud, as well as serving as Internet Access Points. Joseph Shoulder Pad, co-founder of Heli-Lab said, “Since the drone is offline the network can also become a hot spot, or a router that allows those who come to earth to exploit the band. A useful way to not leave completely isolated areas affected by natural disasters and that can also be used by rescue workers of the first hour and by the Civil Defence.” As I’ve previously written, the use of drones for agriculture and humanitarian efforts, drones used in this capacity further enable better food and manufacturing processes to develop. From the data gathered from drones, farmers can now start to understand and leverage that information in order to produce food more efficiently. According to the company, in agriculture, the use of Helio drones offers many benefits in the assessment of the health status of crops, including: precision measurement of agriculture with cameras and infrared multispectral; study and monitoring of the state of force of biomass, forest and agricultural; analysis, forecasting, prevention and monitoring of the harvest; treatments with pesticides and fungicides shedding DRONI high payload The cumulative data gathered and provided by drones can then be built into softwares that visualize patterns and trends in the soil; which ultimately helps farmers understand what is happening beneath the ground so they can compensate for any deficiencies their crops have. Being able to store that data in the cloud allows them to model patterns past and present over a region or an entire area and make future predictions on crop cycles. The American Farm Bureau Federation estimates farmers’ return-on-investment alone could be $12 per acre for corn and $2 to $3 per acre for soybeans and wheat for the efficiencies that drones provide. The Helio-Lab drone helps Italian farmers achieve what the AFAB predicts stateside. The Internet installed on the Helio drone could allow farmers to connect with one another, assisting in the sharing of ag data and information. In the future, these devices could possibly even create agribusiness troubleshooting communities based on simple access points built within the vary machines they’re using. Wouldn’t it be great to share information and get knowledge from fellow farmers? What’s more, given its current funding model, this could also enable Helio-Lab to achieve a more cost-effective agridrone data solution than what’s currently on the U.S. market from Agribotix at $11,900 per year for use. While you may have crop efficiencies and increase your profit, a price tag like that may limit access to many farmers who rely on subsidies worldwide just keep the lights on. Source - psfk.com

25.01.2016

Ethiopia set to launch weather index based crop insurance

The government of Ethiopia is set to introduce weather index based crop insurance aiming to rescue smallholder farmers from unpredictable weather that damages their crops. Experts from various relevant government institutions, private sector and representatives from regional states met last week in Adama city of Oromia Region to discuss on how the country will have its first effective weather index based crop insurance. Speaking at the meeting Yewondwossen Eteffa, CEO of Ethiopian Insurance Corporation (EIC) stressed the need of strengthening and diversifying insurance services to strengthen the financial sector of Ethiopia. He also pointed out the works that have been done so far to come up with an improved and innovative insurance coverage that is suitable for the current Ethiopian context which includes working with Public Financial Enterprises Agency (PFEA) to identify the roles and responsibilities of the concerned parties. The meeting is a continuation of a series of its kind conducted in order to create awareness among the key players regarding the service and discussed on ways to take the crop insurance initiative one step further towards implementation. When implemented, this new insurance product will enable smallholder farmers to insure their loans and investments to purchase and use agricultural inputs. The insurance service is expected to reach over 200,000 farmers at the initial period and millions of small holder farmers in the coming strategic periods. Pilot Index-Based Livestock Insurance (IBLI) project in Kenya and Ethiopia demonstrates innovative approaches to insuring poor nomadic pastoralists in challenging circumstances, according to the 2015 global report, 'Scaling up index insurance for smallholder farmers: Recent evidence and insights', by the Consultative Group for International Agricultural Research (CGIAR). Last week's meeting was organized by the Public Financial Enterprise Agency (PFEA), Agricultural Transformation Agency (ATA), Ethiopian Insurance Corporation (EIC), National Meteorology Agency (NMA) and Kifiya Financial Technology PLC (KFT), which is known for introducing an information technology based bill collection in Addis Ababa through its channel, Lehulu, in a public private partnership with government institutions. “Kifiya is working in helping insurance companies develop client centered microinsurance product that can be implemented at scale at low cost by providing modern and innovative technology platform,” said Megerssa Miressa, Director of Microinsurance Program at KFT. As the county moves forward in introducing its first weather index based crop insurance, the state-owned EIC will be primarily engaged as the insurance underwriter. While PFEA and ATA will work jointly in creating an enabling atmosphere. Using the weather data that will be provided by the National Meteorology Agency, Kifiya, the technology company that has been engaged in micro-finance and tailored rural financial solutions, will be providing the micro-insurance platform. KFT’s consortia partner University of Tewnte, Netherland has been developing (piloting) the risk model and research along with digital finance service platform to enable digital enrollment and delivery of the product to the intended smallholder farmers. Micro Save is acting as a consulting partner to Kifiya. CGIAR's January 2015 report shows that in East Africa (Kenya, Rwanda and Tanzania), the Agriculture and Climate Risk Enterprise (ACRE) has recently scaled to reach nearly 200,000 farmers, bundling index insurance with agricultural credit and farm inputs, according . "In Ethiopia and Senegal, the R4 Rural Resilience Initiative has scaled unsubsidized index insurance to over 20,000 poor smallholder farmers who were previously considered uninsurable, using insurance as an integral part of a comprehensive risk management portfolio," said the report, which stated India's national index insurance programmes have reached over 30 million farmers so far. Source - newbusinessethiopia.com

25.01.2016

Extreme cold coming to China

Chinese citizens are embracing for, what is said to be, the coldest winter in 30 years. The temperature in some parts of Northern China has dropped to -48 degrees and the cold is expected to spread over the weekend. Some schools have shut down and public services are disrupted. The sea around Qingdao port in the Northeast has frozen. The temperature in Beijing will drop to -17 degrees during the weekend, whereas the temperature in Dalian, port city at the Northeast coast, will drop to -20 degrees. In the coming days the temperature is expected to drop an additional 10 degrees in many parts of the country. Xinhua reported that, if that happens, 90% of the country would be below freezing levels. There are concerns that the cold will damage fruit and vegetables. The Daily Mail published a comment of a farmer who is concerned that, if the cold stays below zero for several days, only 10% of his vegetable crop will survive. Source - freshplaza.com