Agriculture is a critical sector in many countries. As shortages on the supply side have resulted in concerns over food security, demand for agricultural re/insurance products in the fast-growing emerging markets has increased.
Roman Hohl explains how re/insurance can contribute to the sector’s growth and stability in farm income.
Excessive droughts in Western Australia and Russia, unprecedented floods in Pakistan, as well as the current drought outlook for parts of Argentina and Brazil, not only captured the media headlines in 2010, but also tightened the supply of key agricultural commodities. As a result, prices for food items in many developing countries are increasing, although not (yet) to the extent of the 2007/2008 food crisis.
The increasing wealth of a growing population in the Asian emerging markets is leading to more demand for higher protein foods such as beef and dairy products. Additionally, the biofuel industry is competing with the food sector for the same agricultural commodities.
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Agricultural insurance, Brazil, Swiss Re, China, Russia, India, Emerging markets