The Cashew nut Association of Cambodia (CAC) is advocating for greater understanding and adoption of agricultural insurance, particularly in light of the challenges posed by climate change.
CAC president Uon Silot said on August 27 that currently, only the Forte Insurance (Cambodia) Plc offers agricultural insurance for paddy rice and cashews.
Notably, only owners of expansive cashew plantations are opting for this insurance, leaving smaller plantations potentially vulnerable.
“Our association actively champions the importance of these insurance products. Climate change impacts yields. Having insurance can safeguard farmers from these fluctuations,” said Silot.
“It’s heartening to know that when local farmers face challenges, insurance can cover risks beyond just climate change. The coverage can even address shortfalls in yield,” he added.
A recent collaboration has seen the CAC and Forte Insurance come together with an agreement to promote agricultural insurance countrywide.
“Farmers are sometimes forced to sell their plantations in order to cover losses, but with insurance, they can get support covering half of their losses.” Silot explained.
Despite Cambodia boasting about 40 insurance companies, Silot wishes for more robust insurance offerings to better support at-risk farmers, especially considering the looming threats posed by climate change.
Youk Chamroeunrith, CEO of Forte Insurance Cambodia, highlighted on August 27 how crucial these insurance services have become.
“Farmers can still manage to break even or earn some income to fund the next season, even if adverse weather conditions affect their yields,” he said.
“We have been a pillar of support for countless farmers. Farming has its good and bad years, but our aim is to ensure farmers remain stable. Our goal is for them to at least break even without sinking further into debt,” he added.
According to the CAC, there has been a noticeable shift in cashew production. From January to July of this year, Cambodia produced 620,000 tonnes of raw cashew products.
Out of this total, a significant 591,000 tonnes were exported to Vietnam, bringing in $805 million. This marks a decline of 15.9 per cent compared to the same timeframe in 2022. The current going rate for dried cashew nuts stands at $1,658 per tonne or 6,700 riel ($1.66) per kilogramme.