Agricultural Risk is a situation where the outcome of an agricultural input is not certain but where the probabilities of the alternative outcome are known or can be estimated. Example: Late planting of Maize, Not following the vaccination schedule in poultry farm strictly.
Agricultural risks are prevalent and vary within the agricultural supply chain, they are functions of the following factors:
• Prevailing weather condition.
• The present season of production.
• Unpredictable biological processes.
• Geographical separation of production and end use.
• Epileptic nature of Government policies both home and foreign.
These are what naive farmers across the globe encounter in their day to day agricultural activities. The effects of these agricultural risks are not peculiar to the farmers alone but extend to the supply chain where the agricultural commodities surface before it finally reach the consumer.
Managing risks in Agriculture could be very tasky because most of these risks are highly correlated resulting in an epidemic situation where the whole community suffer the debacle. A good example is the “tomato ebloa” that almost slayed tomato production in Nigeria. Agricultural risks faced by farmers are copious, these risks constrain the farmer from improving his production also increasing his revenue. It is crucial to know the difference between risks and challenges, challenges are prerequisites to risks.
MAJOR AGRICULTURAL RISKS FACING THE FARMERS.
1. Weather risks
2. Biological risks
3. Labor risks
4. Price risks
Weather is the atmospheric conditions of a particular place. Weather risks are cogent factor to be considered in any agricultural pursuit. Weather risks entail the effect of rainfall, temperature and wind on Agricultural production.
Rainfall helps to waken the soil, it prepares the soil for farming activities also replenishes the soil nutrient through the fixation of Nitrogen as a result of lightning . Rainfall can be excessive, moderate or uneven, all these patterns of rainfall are risk-incurring.
The agricultural risk associated with excessive rainfall is flood, which leads to erosion and the effect of erosion is the loss of nutrients from the top soil or leaching of nutrients to the underground water. Either of these is not a good one as it leads to decrease in crop yield. In a situation where the rain is uneven, the crop gets inadequate water supply which makes it wilt and leads to loss of the plant. Also, during the rainy season, there is high occurrence of disease and pest invasion leading to high cost of production and decrease in yield.
However, moderate rainfall pattern is what most farmers sought out for. Since this pattern cannot be determined by anybody, it has made rainfall a potential risk to the farming communities. Following the current change in climate, it becomes very difficult to determine the pattern of rainfall.
Weather risks management.
Managing risks associated with weather is expensive because it requires a lot of financial commitments. Weather risks like rainfall can be managed through the use of a controlled system known as Green house or Screen house. It is a highly mechanized system where all the parameters needed for plant growth(water, sunlight and air) are controlled.
Using green house or screen house helps to mitigate all weather risks, though expensive but the best. In cases of drought, complete irrigation facility is the best to reduce the effects of the risk. Drip irrigation is the best irrigation system to use, though there are some other modified irrigation systems but considering all ramifications drip irrigation is the best.
These are Agricultural risks associated with pest and diseases invasion. Pests and Diseases are major threats in Agriculture, common in both crop and animal production. These risks reduce the yield of crops and leads to loss of animal in livestock production.
A good example is the tomato Ebola caused by Tuta absoluta, was the destabilizing factor in the tomato farming communities, also smut disease in maize, blast in rice , coccidiossis in poultry and brucellosis in cattle. These diseases are major threats as they are capable of causing gruesome economic damage in a farm. Scientists and breeders are really putting there shoulder to the wheel to ensure these risks effects are reduced to the lowest level.
Biological risks management
There are different approaches to manage Agricultural Biological Risks without much ado. The management approaches are fundamental, they start from the basis.
In crop production, there are prophylactic measures or practices which help to mollify the incidence of these risks and considerably serve as palliative measures to their effects. Proper land preparation is a primary management measure to curb the manifestation of the effects of Biological risks in crop production.
Conventional tillage practice is the most advisable considering its benefits. It gives no room for pest and diseases emergence as it will expose them to unfavorable conditions leading to their death.
Another means is the use of improved or resistant variety of seeds. These seeds are different from genetically modified seeds, these seeds are cross bred seeds from two parents with each desired characteristics to form a single seed bearing these characteristics. Though may seem expensive, but it is advisable to plant this type of seeds owing to the virtue of their hardiness and resistance to diseases.
As a prophylactic measure, use of proper herbicides and pesticides should be adopted. Pre-emergence herbicides and pesticides should be used on the farm before planting is done.
The vaccination schedule of poultry production should be strictly adhered to avoid the risk of disease conditions. Proper hygiene and cleanliness should be adopted to avoid any disease outbreak. The level of hygiene on a farm determines the chances of disease outbreak on the farm.
Agricultural risks associated with labour must be considered . Labour can be manual or mechanical, skilled or unskilled. Unskilled or manual labour is the cheapest though less efficient, it is basically powered by man or animal which makes it unstable and unpredictable. This is where the risk creeps in, animal or human might fall sick slowing down production processes.
Unlike mechanized labour, where farm machineries are used to carry out all activities on the farm. It is the most reliable and efficient source of labour. The skilled labour is the professional type of labour, where professional in a specific filed like animal health or nutrition is hired to work in a farm.
The agricultural risks associated with labour is the behavioral change of the labour source, this might be as a result of unfair treatment by the farmer such as financial distress. This will greatly reduce the efficiency of the labour leading to decrease in production and loss of income.
Labour risks management
Labour risks can be curbed through the development of cordial relationship between the owner of the farm and the labour source (workers). The latter are the pioneer of the business, they are the brain behind the success of the business. They should be treated in such a way that they would always be happy at what they are doing. Any psychological change towards the business by the workers could make the business dwindle.
Their salaries must be paid to time, also incentive should be given no matter how small it might be, it would be appreciated. Labour efficiency can be increased not only through increase in labour productivity and cost reduction but also through ensuring a high morale of the farm workers, this can be attained through the following ways:
• Favorable working conditions: Good working conditions are related to adequate salary and incentive plans. A manager or farmer should be certain that he is paying the labour source what it worth.
• Supervision: The manager or farmer must see that assigned work is performed according to instructions given.
• Cordial employee relationship: In addition to supervision and conducive working conditions, relationship between the manager and his workers can increase efficiency and production. To achieve this, the manager must develop mutual respect and trust. Also, the manager must be patient with the employees when they make mistakes.
A good employer praises a job well done !
This is another obvious risk in agriculture. The price of agricultural produce are not always determined by the farmer. There are certain factors that affect the price of agricultural produce. Consumer’s will is key so also the availability of the commodity, if it is scares or not.
The price of an agricultural commodity during the rainy season is greatly different during the dry season owing to the fact that agricultural commodities are always copious during the rainy season, this affects the price greatly.
Also, owing to the perishability nature of agricultural produce, farmers would be forced to sell at a cheaper price making little return from the sale. It is possible for a farmer to envisage a particular price for his produce at the beginning of production but selling at a cheaper price at the end of production. All these boil down to the season and availability of the agricultural produce in the society.
Price risks management
Agricultural price risks can be managed and the effects can be mitigated through the following approaches:
• Good storage facility: Owing to the fact that agricultural produce are perishable items, it is imperative for a farmer to have a good storage system if truly such farmer wants to mitigate price risks. Storage systems will increase the shelf life of the agricultural produce. This will enable farmer sell at a reasonable price making reasonable profit.
• Unification of farming communities: Farmers should have a general and fixed price for each agricultural produce irrespective of the season and locality. It would curb price risk since the price is the same. Also, it would make the farmers enjoy mutual benefits such Government support and consideration during policy making.