Like many proud Brits I’ve spent the week watching Wimbledon and enjoying my strawberries and cream. But in a few years’ time, seasonal British strawberries could become a thing of the past. I’m an urban-dwelling insurance expert and I’ve an urgent message about our food supply, the financial security of our rural economies and our farmers’ wellbeing. The average age of a British farmer is nearly 60. Unless we share these risks more fairly between producers and consumers, we could run out of farmers before we run out of food.
How can I be so sure? I recently co-authored a report published by the European Commission and European Investment Bank with insurance group Howden. Titled rather unglamorously Insurance and Risk Management Tools for Agriculture in the EU, this was the first EU-wide financial evaluation of the impact of climate risks to current and future crop yields. The reality we documented is shocking.
As we enjoy Wimbledon, I’ve an urgent message about our food supply and the financial security of rural economies
EU annual average losses to crops and livestock from climate events are already 6% of yields and, by 2050, will rise to nearly 10%, or €40bn. These averages obscure the impact of extreme years such as 2022. By 2050, a worst-case loss scenario for EU farmers could approach €100bn – around 20% of yields. Yet these figures mask much larger impacts at national and regional levels.
Much of that story is about water: too much and too little. Drought will drive over 50% of the losses, from Spain to Sweden (and 35% in Ireland), while extreme rainfall will increase flood losses. Surprisingly hail will increase sharply too. Counterintuitively, frost losses will increase by 40% in the next 25 years because global heating causes earlier budding, increasing vulnerability to spring frosts.
Our research showed that, unlike in the US, China or India, EU farmers bear these growing risks largely alone. On average only 20-30% of crops are insured through any sort of public, private or mutual system and, in many countries, including Denmark and Ireland, there is no prearranged climate protection for farmers.
What about the UK? Even after Brexit, doesn’t it, too, depend on EU agriculture supply chains? Yes. Although excluded from our analysis, the climate risks and vulnerabilities of UK farmers are similar, and we have no crop insurance system to protect them. Weather risks and uncertainties facing UK farmers are about to go from bad to worse very quickly. Adding to the risk, about 25% of food and drink industry inputs come from roughly 500 million smallholder farmers in the global south. They face even greater climate risks and have even less protection.
But we are neither helpless nor without hope. We need governments, the agricultural sector and insurers to get together. We must also carefully consider local investment to improve defences against extreme events. There’s incredible data available that we must use to enhance our understanding of risk. Above all, we need to guarantee our farmers, both here and abroad, have access to the collective safety net of affordable public and private insurance.
Without farmers it won’t only be strawberries and Champagne we’ll have to get used to doing without but also that pint of milk or beer, and much of the rest of the produce we take for granted. Let’s ensure farmers have the protection they need.
Rowan Douglas CBE is CEO of Climate Risk and Resilience at Howden and served on the Prime Minister’s Council for Science and Technology from 2011 to 2016
Photograph by Frédéric Scheiber / AFP, Getty