Zimbabwe: Tobacco Farmers Must Insure Crop

Source from:  All Africa 11/04/2010

WE are now in that part of the season when some farmers, especially tobacco growers, risk losing their crops due to hailstorms and other rainfall related disasters. Already, a farmer in Beatrice has lost his crop which had potential to earn him thousands of dollars after a hailstorm hit his crop. The farmer suffered a loss of between 60 percent and 70 percent of his 12-hectare tobacco crop which was at 10-leaf stage and usually it grows to 18 leaves. In monetary terms, Mr Mutami Zishiri lost nearly US$48 000. Despite the loss suffered by Mr Zishiri, we commend him for his foresight as he had insured his entire crop. After the assessment by the insurers and he is compensated, his losses will be minimal. This should be a good lesson to other tobacco farmers who have not yet insured their crop. Hailstorms have been one of the many seasonal hazards encountered by tobacco growers. Last year, scores of tobacco farmers lost millions of dollars to hailstorms and most of then had not insured the crop. The problem of hail is not new. It first became evident in the 1930s and by 1938 tobacco growers met and decided to introduce a co-operative form of insurance which would offer some return to the grower in compensation for the severe and crippling losses he could incur. This was a self-help scheme which progressed well for a number of years. Most tobacco growers voluntarily supported this scheme until big insurance schemes came in. It is with this in mind that we feel tobacco farmers should think seriously about insuring their crop. The 2010/11 season will see an upsurge in the number of tobacco growers. Most farmers have taken to tobacco growing because of the benefits realised by other growers last season. Some farmers may not be aware that the Tobacco Industry and Marketing Board early this year reached an agreement with several insurance companies allowing tobacco farmers to do a once-off payment of premiums towards insurance for their crop instead of the previous percentage deductions from every sale. Some of the insurance companies deducted as much as 10 percent from every sale while others took as little as 4 percent. The deductions were done through a stop order facility. The mode of payment was seen as prejudicing farmers. We therefore urge farmers to take up this once-off payment of premiums. In some cases, farmers may also have problems of crop failure and if they take up insurance policies against such unfortunate developments they would be adequately covered against possible losses. There are some farmers that have acquired loans from financial institutions and others are in the process of doing that, it is therefore important that these farmers take up insurance policies to cushion themselves against any eventualities. In the past, many farmers have had problems in paying back loans to banks because some of their returns would not be enough to enable them to do so. It is therefore important that when a farmer, be it a maize or tobacco grower, fails to harvest enough he or she can still manage to pay back the loan because the insurance policy will take care of that. All serious farmers should know that insurance policies for crops and livestock are a necessity for farming otherwise they would be wasting their time. Enditem