South African Farmers Face Greater Risks

Farmer debt has risen 10.4% Commercial farmer numbers has also dropped.

Mutual & Federal executive, Andries Wiese outlined the problems faced by South Africa's farmers.

According to the group manager of agriculture and crop with the insurance group, the number of commercial farmers in South Africa has dropped from 45,000 to 32,000,

Many smaller farmers leave to financial pressures, resulting from drought and insecurity.

Farming debt has increased by over 10%

"The impact of the weather cannot be negated, with hail, lack or, or excessive rain and inconsistent temperatures each playing their part in making agriculture very difficult for farmers," said Wiese.

"Given the external pressures, farmers could easily succumb to strain and stress," he said. "One has to appreciate that clients who under duress need a specific blend of understanding and solutions to the problems and needs."

According to the manager, conditions in the agri-insurance sector are "tough" and competition becomes more and more difficult with each passing year.

"With an increasing number of agri-insurance players and smaller number of potential clients, the stakes have become very high," he said.

"Those farmers who are successful in making increased use of technology to provide the necessary increase in productivity, and the use of technology within the sector has escalated dramatically," he explained.

"This brings challenges to insurers, as not all are geared to provide appropriate cover for the advanced technologies farmers now use."