African Swine Fever: A Wake-Up Call To Sustainable Farming.

The year 2020 was an exceptionally difficult one for farmers in Nigeria. The agricultural sectors faced severe disruptions as the world struggled with the COVID-19 pandemic and lockdowns. Amid the pandemic’s disruption of supply chains and access to markets, an outbreak of African Swine Fever (ASF) struck, killing over 300,000 pigs. The challenges were very devastating for the pig farmers

For many farmers, the impact of ASF went beyond financial ruin. Many of them were retirees who had invested their life savings or retirement benefits into pig farming but lost everything to the outbreak. Sadly, the burden of servicing loans on their lost investments, combined with the emotional and financial strain, resulted in multiple fatalities due to high blood pressure. The consequences were not just economic losses but loss of lives and livelihoods.

“My father couldn’t cope with the loss. He passed away because the pressure was too much.” was one of the remarks from this disaster.

As devastating as the 2020 outbreak was, ASF has since become a yearly occurrence in Nigeria, particularly at the Lagos State’s Oke Aro Pig Farm Estate which happens to be the largest pig farming hub in West Africa. Despite these occurrences, there has been no significant recovery system in place for the farmers. The government’s occasional relief efforts offer only fleeting respite leaving farmers in a perpetual cycle of losses. This recurring crisis underscores the need for a more permanent solution to support the farmers and the industry at large. This was not just a local issue as the pig farm estate is responsible for a significant portion of Nigeria’s pig supply, so the ripple effect affected both food security and the economy.

“I lost everything,” said one farmer. “Years of hard work, gone in days. There was no compensation, no backup plan.”

What is African Swine Fever (ASF)?

ASF is a highly contagious viral disease affecting domestic and wild pigs. It spreads rapidly, causing severe illness with high mortality rates, often wiping out entire pig populations. While ASF does not pose a threat to human health, it has devastating economic consequences for farmers and the pork industry. The virus is resilient and can survive for long periods in animal feed, and contaminated environments, making it challenging to control. Currently, there’s no vaccine or cure, so preventive measures like biosecurity and early detection are crucial.

The Ripple Effect on Food Security and the Economy

The effects of ASF went beyond the farmers at Oke Aro. The pig farming industry is an important part of Nigeria’s agricultural sector, contributing to local food security. The loss of so many pigs led to scarcity which meant higher pork prices and reduced availability of a major protein source for Nigerian consumers. The economic blow extended to supply chains, impacting feed suppliers, transport workers, and meat sellers, who depend on the farm’s operations. With the massive loss of pigs, both the local and national economies suffered a great deal due to reduced economic activity surrounding the industry. Indeed the effect of ASF was severe, but what if farmers had livestock insurance?

What Insurance Could Have Done

Livestock insurance specifically protects against disease outbreaks like ASF, which could have helped farmers recover from their losses. With insurance, they could have received compensation for the pigs lost to the disease, allowing them to reinvest and restart their farms more quickly. Additionally, policies that cover business interruption could have provided support during the time it took to rebuild operations, protecting farmers from long-term financial ruin.

Countries like Spain and China, where ASF has struck before, were better prepared with insurance schemes that cushioned the economic impact, allowing farmers to bounce back faster and limiting the wider effects on the food supply chain.

Government Intervention:

The Nigerian government’s response to the ASF outbreak in 2020 was insufficient. Although there were efforts to provide some relief to affected farmers, it fell far short of what was needed to compensate for the magnitude of losses. More importantly, the government’s support lacked long-term strategies that could prevent such devastation in the future.

What Could the Government Do?

1. Mandate Livestock Insurance: The government could work with insurance companies to mandate affordable livestock insurance for large farms like Oke Aro. This would ensure that farmers are better protected in the event of another outbreak.
2. Subsidies for Farmers: To make insurance more affordable, the government could offer subsidies, helping small and large-scale farmers alike to afford comprehensive livestock insurance.
3. Disease Control Programs: The government should invest more in biosecurity measures and disease control programs, ensuring that the spread of diseases like ASF can be contained before they wreak havoc.
4. Compensation Fund: Establish a national compensation fund that kicks in during times of agricultural crises like ASF. This could help ensure that even uninsured farmers receive some level of financial aid.
5. Agricultural Education: Increase education and awareness about livestock diseases and the importance of insurance in risk management. Farmers need to understand the value of protecting their investments.

The Reluctance of Insurers to Cover Oke Aro Risks

Despite the clear need for insurance to protect against future outbreaks, most insurance companies are reluctant to underwrite risks for pig farmers, especially at Oke Aro. The imminent exposure of the farm to epidemics like ASF is a major deterrent, but the reluctance also stems from several critical challenges on the ground:

• Contaminated Environment: Insurers have raised concerns about the cleanliness of the environment. Without proper sanitation and biosecurity measures, the risk of disease outbreaks remains high, making the area less insurable.
• Lack of Structured Guidelines: There are no clear sanitation protocols, no established guidelines for the use of shared attendants and veterinary doctors, and limited enforcement of biosecurity standards.
• Poor Record-Keeping: Farmers at Oke Aro often do not maintain accurate records of their stock or document their financial operations, making it difficult for insurers to assess and quantify potential losses.
• Perceived High Risk: Given the lack of structure and the history of recurrent outbreaks, insurers perceive Oke Aro as a high-risk area, leading to higher premiums, which the farmers see as unaffordable.

A Middle Ground Solutions to Make Insurance More Appealing

For insurance to be a viable solution for both parties, steps need to be taken to address these challenges. Here are potential solutions to make insurance more appealing and feasible for both the farmers and insurers:

1. Improved Sanitation and Biosecurity Measures: Farmers must adopt stricter sanitation guidelines and biosecurity protocols. This includes regular disinfection of pig pens, clearer layout plans for the estate to prevent the spread of disease, and dedicated sanitation officers. By creating a cleaner environment, the risk of outbreaks can be reduced, making the area more insurable.
2. Implementation of Record-Keeping Systems: A lack of clear records poses a significant challenge for insurance companies in assessing risk. Farmers should maintain proper documentation of their pig stocks, financial records, and veterinary treatments by introducing a simple digital platform where farmers can record and track stock, production levels, and expenses.
3. Shared Risk Solutions: One of the key concerns raised by farmers is the high cost of premiums. Given the high-risk nature of pig farming at Oke Aro, insurers price premiums accordingly. However, shared risk solutions could help reduce individual costs. The establishment of a collective insurance pool where farmers contribute to a shared fund could help distribute the risk. Government or NGO subsidies could further lower premium costs, making insurance more affordable.
4. Government-backed Compensation Funds: Since outbreaks like ASF are a recurring threat, the government should set up a compensation fund to assist farmers when an epidemic occurs. This fund could act as a backup to insurance, ensuring that in the event of a loss, there is always a source of recovery.
5. Education on the Importance of Insurance: Many farmers view insurance premiums as an unnecessary expense rather than a critical investment in the sustainability of their business. There needs to be a shift in perception. Educational programs and awareness campaigns can demonstrate the long-term value of insurance. These programs could include success stories from other agricultural sectors where insurance helped farmers recover from losses, emphasizing the peace of mind and financial protection that insurance offers.

Livestock Insurance Products

Here are some common livestock insurance products available to cover various risks associated with livestock farming:

1. Livestock Mortality Insurance

• Cover: Provides financial compensation in the event of the death of insured animals due to natural causes, diseases, accidents, or other specified perils.
• General Exclusions: Death from pre-existing conditions or natural disasters not covered in the policy.

2. Comprehensive Livestock Insurance

• Cover: This is a broader policy that covers the loss of livestock due to accidental death, illness, disease, theft, fire, flood, and other unforeseen events.
• General Exclusions: Specific epidemic outbreaks or cases where biosecurity measures were not followed.

3. Epidemic Disease Insurance

• Cover: Provides coverage for the death or necessary disposal of livestock due to outbreaks of epidemic diseases, such as African Swine Fever (ASF) or Foot and Mouth Disease (FMD).
• General Exclusions: Often, pre-existing or endemic diseases may not be covered unless otherwise specified.

4. Poultry Insurance

• Cover: Protects against the loss of poultry due to diseases, natural disasters, theft, or accidents. Some policies also cover loss of production due to disease.
• General Exclusions: Poor farm hygiene or non-compliance with veterinary practices.

5. Aquaculture Insurance

• Cover: Provides protection for fish farmers against losses caused by disease outbreaks, theft, pollution, or extreme weather that affects fish stock.
• General Exclusions: Negligence or poor farming practices.

The Way Forward

While the challenges of insuring Oke Aro pig farmers are substantial, they are not insurmountable. By improving farm management, sanitation, and transparency, and by working with insurers to create more accessible products, both parties can find a middle ground. Insurance is not a luxury but a necessity in a high-risk environment like Oke Aro. With the right steps, it can become an affordable and valuable tool to help farmers weather the storms that have, for too long, threatened their livelihoods.

A Call to Action

The ASF outbreak of 2020 taught us an important lesson in livestock farming because it is laden with risks, and when disaster strikes, the consequences can be shattering. Insurance provides a lifeline, allowing farmers to recover and rebuild. The Nigerian government must take proactive measures to support the pig farming industry, ensuring that such devastation does not occur again. Farmers on the other hand must begin to view insurance as an essential part of their business strategy. Otherwise, they will continue to be at the mercy of unpredictable events like ASF thereby jeopardizing their investment.