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Colombia: Rains/Weather Insurance

Colombia’s 2018 Secondary Crop At Stake On Rains, Coffee Federation Studies Weather Insurance

COFFEENETWORK (Manizales) –Some of Colombia’s coffee provinces are experiencing dark clouds as torrential rains in the past months have threatened the 2018 secondary crops where higher-than-average downpours have prevented flowering to take place, the general manager of the coffee growers’ federation Roberto Velez said.

Key regions in the world's biggest producer of high-quality Arabica beans are not experiencing the critical flowering period because Colombia’s second rainy season, which began in October, have “compromised”, the secondary harvest, also known as mitaca, Velez told reporters on the sidelines of the 85 coffee congress held in the coffee city of Manizales.
“We are seeing that departments did not experience enough flowerings to have proper production during the mitaca, “ Velez said. “We are waiting to see how weather behaves in the next months to see if we have a good harvest in the second half of the year,” he added.

Colombia is experiencing the country’s second rainy season since October with rains expected to last until 15 December, the government’s weather institute Ideam, said.

Too much rain during the flowering stage -- a key process for predicting the secondary harvest in 2018 -- could knock down the flowers and landslides could wipe out trees and wash away roads, the main way coffee is transported in the nation.
Colombia harvests its secondary crop from April to July in the traditional provinces of Antioquia, Caldas, Risaralda, part of Huila among others.
And the southern provinces of Narino, Cauca, Tolima and some areas of Huila collect their main harvest from April to July, which need sun eight months before the harvest. Those states account for about 44% of total national output.
When asked if coffee production in the calendar year 2018 may drop below 14 million 60-kg bags, Velez said risks are high if rains continue through February.

Colombia harvest its main harvest in traditional provinces like Antioquia, Caldas, and Risaralda in the September through December, and coffee plantations need strong sunlight eight months before to allow the key flowering period.

Jorge Enrique Montenegro, the executive director of the coffee committee for the Huila department to the growers federation, that rains will impact the harvest of the first half of next year.

Huila, the country’s largest coffee producing department, has slightly more than 130,000 hectares producing coffee, contributing with 17% of the country’s total output .

Montenegro told CoffeeNetwork that because of rains, Huila’s coffee production in 2018 will remain unchanged from this year’s output of around 2.4 million 60-kg bags.

Insurance for coffee farmers

The coffee growers’ federation along with the World Bank and the Andes University are studying an insurance to protect growers from climate change and hedge against price volatility, the federation's chief said.

Colombia is studying a hedging mechanism implemented in Mexico to protect maize crops from price volatility. Mexico started an innovative program two decades ago where the government provides a subsidy of between 50 and 100% to hedge against price volatility.
But Velez acknowledged that they “haven’t had the scientific basis to tell insurance companies what could be the cost of the insurance’ premium,” he noted.

Writing by Diana Delgado

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