Fertiliser Suppliers Association of Nigeria (FEPSAN) has commenced the insurance of farmers, targeting over 3 million farmers across Nigeria under the programme geared towards a sustainable agribusiness venture.
The potential partnership, which would package insurance bundle with up to 14 million bags of fertiliser, could see as many as 3.9 million farmers benefitting from climate insurance in 2020 and up to 19 million by 2025, the organisers say.
The insurance products have been deployed to over 1 million smallholder farmers in 2019 alone.
The insurance programme has become important considering huge risks farmers across Nigeria currently face, including climate-induced drought, excessive rainfall, pests and disease, among other challenges that undermine their ability to acquire good yield and incomes.
Thomas Etuh, chairman, FEPSAN, speaking at the fertiliser stakeholders workshop held in Abuja on Tuesday, said the yield index insurance could be a lever for helping farmers cope with weather and other peculiar risks, while scaling adoption of fertilisers among smallholder farmers in Nigeria.
The workshop was supported by leading development agencies and foundations including AGRA, the Gates and Rockefeller Foundations, UKAid, and USAID and convened by Pula.
Etuh said the proposed yield insurance would ensure compensation for farmers in the event of climate or any catastrophe, adding that it was an important intervention that would shield the farmers from risks and build a sustainable farming enterprise that could withstand shocks.
“This insurance also provides financial security that gives farmers confidence to invest in additional inputs like fertilisers knowing that their investment will be protected by insurance in the event of crop failure,” Etuh said.
“The partnership which would bundle insurance with up to 14 million bags of fertilizer could see as many as 3.9 million farmers benefitting from the climate insurance in 2020 and up to 19 million 2025,” he said.
The workshop seeks to promote ways of adequately insuring not just the farm but also the inputs such as fertilisers, seeds as well as agro chemicals to ensure they are adequately used to produce the desired output, he said.
“The pioneer programme is based on fertilizer insurance, to ensure they get the required yield, and are compensated in case of shortage in output. And address the case of adulterated fertilizers,” he said.
Rose Goslinga, CEO, PULA, said the efforts of PULA were aimed at empowering smallholder farmers in emerging markets by providing agricultural insurance that protects them against climate risks, weather shocks and losses caused by widespread outbreaks of pest or diseases.
“We partner with input producing companies, governments and loan providers to bundle insurance with the inputs farmers want, like seed, fertilizers and credit. Our insurance products are suited for every Nigerian farmer. Embedding agriculture insurance to fertilizer will enable these companies to understand farmers better while providing them with real protection,” she said.
She stressed that the insurance programme was expected to avail several benefits to other stakeholders as it also aids easy generation of data which will allow for digital tracking of fertiliser to eliminate illegal use and adulteration.
“This will also provide for visibility that will eliminate the illegal use of urea in the making of explosives which has become a growing national security threat in Nigeria,” she said.
Anibe Achimugu, president, National Cotton Association of Nigeria, said Nigeria had remained multi risk-vulnerable country in regards to commercial agricultural, adding that the initiative was a welcome development as the sector was in dire need of various supports.
“With this type of insurance, a farmer is compensated if his realised yield is less than the insured average yield; I think this has become absolutely necessary given the uncertainty that now assails farmers from every direction,” Achimugu said.
“Beyond palliatives, I am strongly persuaded that the most crucial intervention that could match identified multiple risk factors and actually stand the test of time will be to figure out the most fitting insurance policies for our local condition,” he said.
HARRISON EDEH & CYNTHIA EGBOBOH, Abuja
