Dossier

Making value chains climate-smart

Climate-smart agricultural (CSA) practices are increasingly adopted as a means to both adapt to a changing climate, and to mitigate agriculture’s negative environmental impacts. Increasing emphasis is placed on a systems approach to CSA, where climate-smart interventions seek to address the entire value chain.

Rapidly increasing numbers of pastoralists are taking up insurance policies in Ethiopia and Kenya © ILRI/IBLI
Rapidly increasing numbers of pastoralists are taking up insurance policies in Ethiopia and Kenya © ILRI/IBLI

Wednesday, 03 October 2018

Drought is a common occurrence in the Horn of Africa. However, with climate change, droughts are becoming more frequent and severe. As more livestock die and pastures dwindle, pastoralist communities are increasingly vulnerable. To build resilience among pastoral communities in northern Kenya and southern Ethiopia, a new initiative is seeking to stimulate market-based solutions to climatic impacts in the livestock value chain. This incorporates market-based, blended agri-weather information services, increased livestock-based insurance uptake, improved market access and empowering vulnerable women and youth to run businesses that minimise shocks to their livelihood base.

Known as Climate, Livestock and Markets (CLIMARK), the 2-year project was launched by CTA in 2017 and seeks to build on existing projects in the region, including the International Livestock Research Institute (ILRI)-led Index-Based Livestock Insurance (IBLI) scheme. “We are promoting solutions that address preparedness, mitigation and the sustenance of local economies in a sustainable way,” says Sabdiyo Dido Bashuna, CTA’s Senior Technical Advisor on Value Chains and Agribusiness. The project brings together CTA, ILRI, Takaful Insurance of Africa, Oromia Insurance Company, the International Institute of Rural Reconstruction (IIRR), aWhere and Amfratech Limited and aims to reach 100,000 people in dryland areas.

To build pastoralists’ resilience to climate shocks through timely information, data and technology companies aWhere and Amfratech have been running a pilot agri-weather information service since March 2018, and are currently working with 30 pastoralists in Isiolo, Kenya. aWhere produces daily meteorological information that is tailored to the needs of various livestock value chain actors, while Amfratech translate that into actionable information sent directly to mobile phones. The information provided alerts pastoralists to impending droughts, giving them time to prepare mitigation actions and links to markets, in advance. Following the pilot studies, the CLIMARK project aims to scale-up the agri-weather information service, for use by pastoralists across Kenya and Ethiopia.

Reducing risk

Partnering with ILRI, along with Takaful Insurance of Africa in Kenya and Oromia Insurance Company in Ethiopia, CLIMARK has also sought to reduce drought-related livestock deaths by promoting agri-weather-based insurance, at a time when drought poses a growing threat to pastoralists. In 2017, for example, many cattle herders in northern Kenya lost over 70% of their livestock to unprecedented drought.

Through ILRI’s IBLI scheme, pastoralists are now able to receive payouts when fodder diminishes below certain thresholds. “Index-Based Livestock Insurance is a vital component of the CLIMARK project because livestock remains the main asset for pastoral communities. Since we first rolled out the scheme in 2010, we have been constantly innovating and experimenting to ensure it responds to the needs of these communities, while also addressing their concerns. It explains why the IBLI uptake is now at commendable levels,” says Rupsha Banerjee, an ILRI social scientist.

In Ethiopia, Oromia Insurance sold their cover in the 2017 August-September period to nearly 3,000 households, compared to only 700 households during a similar period in 2016. In the 2018 January-February period, over 2,000 households purchased insurance, with the total insured sum valued at €424,000. The rise in uptake is attributed to CTA’s support in helping Oromia to provide customised mobile learning packages in Oromo dialects, and in regulating the dissemination of IBLI information to ensure consistency and avoid distortion by sales agents. In Kenya, Takaful Insurance saw purchase of policies rise from 859 households in the 2016 August-September period, to over 5,000 households during the same period in 2017. In the 2018 January-February period, more than 3,000 households bought the premiums, with 54% of them being women.

Boosting livestock trade

At the market end of the value chain, CLIMARK has been working with IIRR in 10 livestock markets across Ethiopia and Kenya to help boost livestock trade by facilitating buyer-seller matchmaking meetings. These have helped producers gain better insights into existing business opportunities, market specifications and the meat grading process. Exchange visits for livestock-marketing associations (LMAs) to thriving markets has also provided visiting LMAs with useful lessons in the management of livestock markets.

“During severe drought you’ll find that pastoralists sell their animals at a very low price. One of the things we are aiming to do is reduce brokers’ influence so that pastoralists get a better price,” says Chrispin Mwatate, an IIRR programme director. In Isiolo market, up to 300 cattle and 350 sheep are sold daily and record-keeping is key to managing stock and ultimately growing revenues. CLIMARK has also trained the LMA members while taking them on exchange visits to Baringo Market, renowned as the best run livestock market in Kenya. “We are now much more effective as an organisation in terms of the way we collect revenues and run the market. We keep better records and we are attracting new buyers,” says Abdi Halake, vice-chairperson of Isiolo’s LMA.

IIRR’s training also involves fodder management to maximise available pasture. Traditionally, when pasture dwindled, pastoralists in the Sololo area near the Ethiopian border would travel 500 km to Nanyuki to buy hay, which was usually expensive and of poor quality. As a result of the training, the pastoralists now produce their own hay locally for half the price. “Because of this, people around here will be in a much better position to survive drought in future,” says Tumme Shan, a member of Tulu Pasture Women’s Group, which manages a plot of grassland in Sololo. It now produces 300 bales of hay each season, which can be sold for around €3 each.

The way forward

In order for agricultural stakeholders to mitigate and adapt to the impacts of climate change, climate-smart interventions must take the entire value chain into account. Effective climate-smart solutions assess the vulnerabilities of – and action points for – processors, transporters and marketing associations, as well as the farmers themselves. With CLIMARK’s integrated approach, CTA and its collaborating partners believe that the pastoralist livestock value chain is set for ground-breaking transformation in achieving climate resilience.

Bob Koigi

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Facts and Figures

Rapidly increasing numbers of pastoralists are taking up insurance policies in Ethiopia and Kenya © ILRI/IBLI

SOURCE: Based on International Institute for Sustainable Development

The Technical Centre for Agricultural and Rural Cooperation (CTA) is a joint international institution of the African, Caribbean and Pacific (ACP) Group of States and the European Union (EU). CTA operates under the framework of the Cotonou Agreement and is funded by the EU.