5. Building agriculture resilience to climate risks in Chile
This chapter describes Chile’s approach to building agricultural resilience to natural hazard-induced disasters, and to climate risks in particular. It outlines two areas of strength: Chile’s national agroclimatic risk information system, which consists of a series of interconnected platforms, various agroclimatic information bulletins, tools and initiatives to monitor, identify, assess and communicate the risks; as well as the country’s capacity development events and training, which support decision-making by agricultural stakeholders on how to avoid and reduce the adverse impacts of natural hazard-induced disasters. Furthermore, the case study outlines a variety of financial instruments that are available to fund emergency response and recovery activities in the agricultural sector and to transfer risk through the provision of state subsidies for agricultural insurance.
Chile’s agriculture sector is significantly impacted by natural hazard-induced disasters, including climate related events. Due to the expected increase in the frequency and severity of these hazards and their adverse impacts on agriculture, appropriate and effective disaster risk reduction measures should be undertaken to help reduce the underlying vulnerabilities and risks to the sector.
The country’s national agroclimatic risk information system includes a series of interconnected platforms, various agroclimatic information bulletins, tools and initiatives to monitor, identify, assess and communicate the risks. In addition, capacity development events and trainings are organised to enhance awareness raising among key stakeholders on the availability, access to, and usage of, these agroclimatic information products. This informs decision-making of agricultural stakeholders to avoid and reduce the adverse impacts of natural hazard-induced disasters.
A variety of financial instruments are available to fund emergency response and recovery activities in the agriculture sector and to transfer risk through the provision of state subsidies for agricultural insurance. Through the systematic collection, sharing and analysis of data among various agencies, a better understanding can be obtained about the farmers that are regularly affected, the types of events and the kind of assistance they are receiving. This will help to produce information that can inform as well as enhance decision-making about the implementation of disaster risk management strategies and agricultural programmes and policies.
Natural hazard-induced disasters
Given Chile’s location along the Pacific ring of fire, it is one of the most earthquake-prone countries in the world. It is also severely impacted by flooding, followed by wildfires, earthquakes, extreme temperatures, storms, volcanic eruptions, landslides and drought (Figure 5.1).
Earthquakes followed by floods affected more Chileans and inflicted the greatest economic loss between 1985 and 2020 than any other disaster type. During this period, a total of 29 major disasters were recorded in Chile: nine floods, seven forest fires, three polar cold spells, three volcanic events, three earthquakes, two tsunamis, one storm and one landslide. Combined, these affected more than 4 million people and resulted in 853 deaths (EM-DAT, 2019[1]).
Source: EM-DAT (2019[1]).
Impact of natural hazard-induced disasters on agriculture
The 2010 earthquake – the sixth most powerful quake ever recorded – and the tsunami it caused, constitute the most recent rapid-onset disaster to strike Chile and resulted in an estimated economic loss of USD 30 billion, equal to 18% of its national GDP (Economic commission for Latin America and the Caribbean (ECLAC), 2010[2]). The two disasters resulted in the loss of 75% to 90% of Chile’s fishery capacity and damaged nearly 300 000 hectares of agricultural land in the Bio Bio and Maule regions (EM-DAT, 2019[1]). Nearly 70% of irrigation capacity was destroyed in the earthquake-damaged region (Burgoine, 2010[3]). It was estimated that the total damage to Chile’s crop, livestock and forestry subsectors amounted to 2% or USD 601 million of the country’s total damage (FAO, CAS, IICA, 2017[4]).
Drought has also substantially affected the agriculture sector, particularly the ‘mega drought’ of 2010-2015, which is the longest and most extensive drought in Chile’s history. A significant proportion of the country (from the Coquimbo to Araucanía regions) experienced a precipitation deficit of 30% during the 2010-2015 period. While its total magnitude is still unknown due to insufficient data on damage and losses, this disaster significantly affected crop, livestock and forestry production. Climate change scenarios indicate that the 2010-2015 situation could become the norm in the near future, resulting in an imbalance between fresh water supply and demand in Chile’s southern regions. This would mean that the cultivation of certain crops might need to be shifted to the south, which would in turn lead to less land being sown with grains, such as wheat. This is an important matter for Chile, which has already seen its wheat area decline by half, from 400 000 to 200 000 hectares, over the last 20 years (Center for Climate and Resilience Research (CR)2, 2015[5]).
During 2008-2019, drought has been the most recurrent event, as evidenced by the number of exempt resolutions for which emergencies have been declared by Chile’s Ministry of Agriculture (MINAGRI), followed by earthquakes, frosts, fires and heavy rains/flooding (Ministry of Agriculture, 2018[6]). However, due to the slow-onset nature of the event, the same drought can lead to multiple emergency declarations. Existing databases do not provide sufficient information to group emergency declarations covering a prolonged drought. This is a current challenge as there can be several back-to-back declarations, both from the Ministry of Agriculture (MINAGRI) and the Agricultural Development Institute (INDAP)1 for a single event (for more information, see Section 5.3).
In addition, analysing public spending on emergency response helps to better understand the economic impact of disasters on Chile’s agriculture sector.2 During the 2008-2017 period, it is estimated that Chile’s total agricultural emergency response expenditures amounted to USD 160 million. During this period, the costliest public emergency responses were for drought, followed by earthquakes, forest fires, volcanic eruptions, snowstorms, heavy rains and frosts (Figure 5.2).
Source: Based on information from MINAGRI (2018).
Chile’s National Civil Protection System (SNPC) consists of various technical and sectoral agencies and ministries, regional authorities, technical and academic institutions, as well as organised civil society at the national and territorial levels. SNPC’s actions are coordinated by the Ministry of the Interior and Public Security’s National Emergency Management Agency’s (ONEMI), which is mandated to plan, coordinate and carry out prevention, mitigation, alert, response and rehabilitation activities to safeguard individuals, their property and the environment (Ministry of Interior, 1974[7]). To ensure that the SNPC is operating efficiently and effectively nationwide, ONEMI also created civil protection and emergency operations committees at national, regional, provincial and municipal levels. Representatives from the Ministry of Agriculture (MINAGRI) and other public and private agencies whose mandates contribute to civil protection participate in these committees (Table 5.1).
MINAGRI is responsible for promoting and coordinating the country’s crop, livestock and forestry activities within the context of sustainable natural resources management. It has an administrative department titled Agricultural Emergency and Risk Management Section (SEGRA), which has disaster risk management responsibilities, e.g. monitoring and issuing agricultural emergency and risk warnings, conducting studies, generating technical information, providing training opportunities, and designing and implementing emergency response actions. Moreover, it coordinates and provides technical assistance to implement regional agricultural emergency and agroclimatic risk management plans, which have been developed for each region.
SEGRA leads the National Agroclimatic Risk Management System, which was established under Chile’s 2009 National Climate Change Action Plan (Ministry of Agriculture, 2018[8]). The Ministry of Agriculture is also a member of several of the National Disaster Risk Reduction (DRR) Platform’s working groups. For instance, those that focus on: i) institutional strengthening; ii) improving the early warning and monitoring system; iii) enhancing a culture of prevention; iv) promoting insurance; and v) strengthening disaster preparedness for effective response.
Chile has several relevant disaster risk management (DRM) policy frameworks, including for example its 2002 National Civil Protection Plan (Ministry of Interior and Public Security, 2002[9]). This plan is non-binding for the various national, regional, provincial and local agencies involved in the SNPC, but nevertheless provides guidance for their disaster risk management actions and encourages adjustment of their regulatory and institutional frameworks. It has been instrumental for ensuring that civil protection actions are in line with sectoral, institutional and territorial needs. It has incentivised several ministries, including MINAGRI, and public and private institutions to better define their specific DRM roles, responsibilities and actions in line with their overall mandates and expertise.
In 2016, the Government adopted a new National Disaster Risk Management Policy (Ministry of Interior and Public Security, 2018[10]). This cross-sectoral policy serves as a reference framework for public, scientific, academic and civil society organisations and includes DRM goals and strategic priorities that are in alignment with international frameworks, such as Sendai and the 2030 Agenda for Sustainable Development. It provides guidelines for setting up ongoing disaster risk reduction and emergency response processes in Chile, and includes climate change a strategic priority. Agriculture, however, is not considered a priority in the policy, and there are no specific measures included for the sector.
As an instrument to operationalize the National Disaster Risk Management Policy, Chile also adopted in 2016 the National Disaster Risk Management Strategic Plan 2015-2018, which outlines specific actors, programmes, actions, and timeframes involved in it (Ministry of Interior and Public Security, 2018[11]). This plan facilitates the adoption of a disaster risk management approach. It prioritizes actions and promotes the involvement of various sectors at the national and territorial levels in designing and implementing effective disaster-risk reduction initiatives. As a member of the SNPC, MINAGRI was actively engaged in defining the Plan’s strategic objectives and activities under four of the five priority pillars: institutional strengthening (pillar 1); strengthening early warning and monitoring systems (pillar 2); promoting a culture of prevention and insurance (pillar 3); and reducing underlying risk factors (pillar 4).
Chile´s approach to agricultural disasters has evolved over time and it now includes more robust mechanisms and instruments to enhance planning, prevention, mitigation and preparedness for response actions involving the various agriculture agencies and other relevant stakeholders. The following areas of strengths to build agricultural resilience to climate risks are included.
Risk identification, assessment and awareness
National agroclimatic risk information system
Chile’s national agroclimatic risk information system includes a series of interconnected platforms, various agroclimatic information bulletins, tools and initiatives to monitor, identify, assess and communicate the risks that are provided by MINAGRI in collaboration with the Agricultural Research Institute (INIA) and other members of the National Agroclimatic Network (RAN). INIA is the main sectoral research institute and conducts monthly agroclimatic risk analyses at national and regional levels. It is also a member of RAN. Farmers and other agriculture stakeholders have free access to real-time information from RAN for their area, which is available on MINAGRI’s main information web portal Agromet. In addition to the real-time data, the network provides five-day forecasts related to hazardous events that may threaten the main fruit trees, crops (e.g. rice, wheat, grassland) and livestock (sheep, bovines) in different Chilean regions. As the web portal provides the most relevant information in reliable form and quality, it is an essential resource for farmers to inform their decision-making, particularly for the country’s crop and livestock subsectors.
Specifically for drought, there is the online Agroclimatic Risk Observatory Platform,3 which provides an early warning and monitoring system for drought. It also identifies the areas most affected by drought and helps the users prioritize their response actions. The Platform provides access to free online information,4 including a data library and maps with information on: i) El Niño-Southern Oscillation situation;5 ii) drought monitoring; iii) historical data from each automatic weather station where available; iv) drought vulnerability maps; and, v) drought warnings.
In addition, various monthly agroclimatic e-bulletins Coyuntura agroclimática and the Monitor Agroclimático are published by SEGRA/MINAGRI. These bulletins document meteorological changes and their impact on the crops, livestock and forestry subsectors. They also provide information on drought monitoring, El Niño monitoring and forecasts, hydrological updates on the flow rates of most major rivers and reservoirs, and updated forest fire information. National and regional agroclimatic risk analysis bulletins for key fruit species, crops and livestock Boletínes Nacional y Regionales de Análisis de Riesgos Agroclimáticos para las Principales Especies Frutales y Cultivos y la Ganadería are also published by INIA on a biweekly and monthly basis. These also outline national and regional meteorological data and specific agricultural practices that can help prevent and mitigate the adverse impacts of natural hazard-induced disasters on the main crop, fruit and livestock production activities in each of Chile’s diverse regions.
Among the constraints regarding these information services and products is the access by farmers. The data platforms seem to be primarily accessed by users located in the Santiago area, as most of these information services and data platforms require access to internet, registration to an institutional e-mail distribution list and some IT skills to understand, analyse and use the services it offers. Moreover, it is not clear to what extent these agroclimatic information platforms and information products are accessed and used by small-scale family farmers, who are not necessarily regular internet users, but could benefit greatly from the provided information and advice to reduce the adverse impacts of climate-related hazards on agriculture.
Moreover, MINAGRI is organising capacity development events and trainings to enhance the awareness raising among key stakeholders, including meteorologists, agricultural experts and farmers, on the availability, access to, and usage of, these agroclimatic information products. For instance, this includes the provision of advice on the best use of new or adjusted farming practices in view of actual weather forecasts and seasonal outlooks. This informs the decision-making of agricultural stakeholders to reduce the adverse impacts of natural hazard-induced disasters. One of the challenges is that extension officers are not direct recipients of the trainings, which limits their ability to transfer risk reduction knowledge and information to farmers.
Risk prevention and mitigation
Agricultural insurance
Agro-insurance is a key pillar of Chile’s agriculture DRM strategy. Government subsidies are currently provided by the Chilean Economic Development Agency’s Agricultural Insurance Committee – Agroseguros,6 which was established in 2000 to increase awareness of agricultural insurance and establish market conditions (e.g. subsidies) to make it more viable for different types of agricultural products. The total subsidy cannot exceed 80 UF7 (USD 2 880) per policy and 120 UF (USD 4 320) per type of crop and livestock for the beneficiary farmer. Every type of producers in the crop, livestock and forestry subsectors (large-, medium-, small-sized companies, microenterprises and small producers) is eligible for this agricultural insurance state subsidy. Most of the insurance products purchased are for garden vegetables and grains, followed by industrial crops, and then fruits and livestock, although insurance coverage of the latter two has increased substantially over the last few years.
In addition, INDAP’s Agricultural Insurance Support Programme (PACSA) is available to assist smallholder and subsistence farmers in purchasing an agriculture insurance policy. PACSA will complement the Agroseguros subsidy up to 95% of the net premium cost unsubsidized by Agroseguros. The maximum net co-payment farmers may receive is 5% for annual crops, 10% for fruit trees, 5% for bovines, 5% for sheep and 5% for apiculture.
Combined, MINAGRI and INDAP allocated a total of roughly USD 10.2 million to subsidize agricultural insurance in 2019. Individual beneficiaries included microenterprises (56%), small businesses (31%), medium-sized enterprises (8%) and large companies (5%) (Vega, 2020[12]). While all types of agricultural producers may participate in the programme, smaller and less-resilient farmers benefit the most. However, the exact number of beneficiaries is currently unknown because only the total number of policies that are subsidized are documented and one single beneficiary can receive subsidies under several policies.
Disaster response, recovery, rehabilitation and reconstruction
MINAGRI and INDAP’s special emergency line of funding for agriculture
Different financial instruments are available to support agricultural producers in Chile. Among others, MINAGRI’s Undersecretariat maintains a special budget line for ‘agricultural emergencies’ through the symbolic allocation of USD 20 until an emergency is actually declared by ministerial decree. Once an agricultural emergency has been declared, MINAGRI’s Undersecretariat can increase this budget line by transferring resources from its other budget lines. However, this resource re-allocation may affect other actions and development programmes, given that they may no longer have access to the full amount of originally allocated funds. Moreover, this approach allows for a flexible allocation of funding, but it is reactive and not based on risk analysis that would be part of proactive disaster risk management planning.
For many years, INDAP conducted the same emergency funding approach as MINAGRI, i.e. allocating a symbolic amount to agricultural emergencies and increasing it as needed. However, since 2016, this initial emergency allocation was significantly increased and between 2016-2019 reached on average USD 2.1 million per year. However, due to the lack of a specific budget allocation strategy that is based on risk analysis or past emergency expenditures, INDAP has been faced with a continuous transfer of financial resources from its development programmes to annually increase its initial emergency fund allocation. Contrary to MINAGRI’s emergency funding, INDAP’s assistance specifically targets smallholders. One of the main challenges is related to adequately determining the annual emergency resources by both agencies, as damage and loss information is currently not shared across institutions. Although both of the agencies’ financial instruments are responsive in nature, they do provide important safety nets and support to farmers’ recovery activities after a disaster has occurred.
While extensive progress has been achieved over the years regarding disaster risk management in Chile’s agriculture sector, a number of recommendations can be proposed to help ensure that disaster risk management in agriculture is included as a cross-sectoral approach across MINAGRI’s programmes, among others:
Enhance the involvement of agro services in disaster risk management: Agro services of the public and public-private institutions, including for example Agroseguros, INDAP and INIA, could play a larger role in advising MINAGRI on how best interventions can be applied to prevent and mitigate the impact of natural hazard-induced disasters. In this regard, disaster risk management roles and responsibilities should be better defined and further enhanced with the aim of achieving greater coordination among the services. To successfully carry out its responsibilities as technical secretary of the Ministerial Technical Advisory Committee for Agricultural Emergencies and Risk Management, SEGRA/MINAGRI must be assigned the human, technical and financial resources it needs to continue strengthening the capacities of Chile’s various agro services and provide the technical support they need to apply explicit DRR criteria in their analysis, planning and programme implementation. The role of SEGRA/MINAGRI remains fundamental to ensure multi-sectoral and multi-stakeholder coordination and collaboration at all levels to build the sector’s resilience to natural hazard-induced disasters.
Increase the dissemination and use of agroclimatic information platforms and products: Chile could increase the number and type of users of existing agroclimatic platforms and products, especially by ensuring that information is provided in simple and accessible formats to small-scale farmers. Options to enhance the outreach of existing products include: i) automatic subscriptions to information products on RAN member websites (INIA has already implemented this for its agroclimatic bulletins); ii) establish mutual links on the websites and products of the RAN members; iii) turn Agromet’s web portal into a gateway to access the agroclimatic information products available within the RAN framework; iv) increase awareness of these agroclimatic platforms and capacity to use them among potential users; v) build user feedback mechanisms into the platforms so that they can be continually upgraded; vi) develop and distribute simple complementary offline products; vii) use WhatsApp and SMS to expand outreach in areas with less connectivity and internet usage; vi) advocate for increased digital infrastructure in rural agricultural areas to improve access to internet and online services; and vii) track and integrate new information products and tools developed by other stakeholders such as the Ministry of Environment that could support agriculture disaster and climate risk management.
Train extensionists on agriculture disaster risk management: Chile could effectively promote resilient agriculture practices through its well-established extension services. This could be achieved by providing regular disaster risk management training for agriculture extensionists. Currently, training sessions target mostly government staff, whilst extensionists are external consultants. It is highly important that the capacities of extensionists related to DRM are strengthened, as it is them who raise awareness of good practices and technologies and transfer the knowledge to farmers to implement them to reduce the adverse impacts of natural hazard-induced disasters on agriculture.
Improve access to, and analysis of, existing data to inform disaster risk management strategies: Available data could be used to generate more detailed analyses if information would be better shared and integrated across institutions, which would help to better understand, among others, the farmers that are regularly affected, the type of events, and the type of assistance they are receiving (including subsidized insurance). This would significantly enhance decision-making about agriculture programmes and policies, as well as inform a financial strategy for disaster risk management in agriculture. As the sectoral lead on DRM, SEGRA/MINAGRI is well positioned to manage the integration of databases and improve the level of analysis. In addition, the role of academia and the private sector is highly important with regard to data collection, analysis and sharing, and MINAGRI could foster increased collaboration with these actors.
Develop a financial strategy for disaster risk management in the agriculture sector: Various financial instruments are available to support agriculture emergency response and recovery, and to transfer farmers’ risks via insurance. These include e.g. allocating funds for emergency support and subsidizing agricultural insurance. Given that it is not clear to what extent there is complementarity between the different budget resources provided by MINAGRI, INDAP and Agroseguros, a financial disaster risk management strategy for the crop, livestock and forestry subsectors could help to determine the allocation of funds and take into account the complementarity and advantages of the various financial instruments. Therefore, it is advisable that Chile assess the extent to which emergency allocations and agricultural insurance subsidy programmes cover disaster-related risks, especially for vulnerable farmers, and the extent they contribute to building their resilience, in order to ensure the sustainability of the financial strategy. This would also help to define, prioritise and allocate financial resources to support disaster prevention, mitigation and preparedness for response actions, including for example risk and vulnerability assessments, which aim to reduce the adverse impacts of disasters on the agriculture sector.
References
[3] Burgoine, L. (2010), Quake impact leaves Chilean farmers short of storage, cooling and irrigation, https://en.mercopress.com/2010/03/30/quake-impact-leaves-chilean-farmers-short-of-storage-cooling-and-irrigation.
[5] Center for Climate and Resilience Research (CR)2 (2015), Informe a la Nación La megasequía 2010-2015: Una lección para el future, http://www.cr2.cl/informe-a-la-nacion-la-megasequia-2010-2015-una-leccion-para-el-futuro/.
[2] Economic commission for Latin America and the Caribbean (ECLAC) (2010), The Chilean earthquake of 27 February 2010: an overview, https://www.cepal.org/en/publications/3161-chilean-earthquake-27-february-2010-overview.
[4] FAO, CAS, IICA (2017), Gestión Integral del Riesgo de Desastres en el Sector Agrícola and la Seguridad Alimentaria en los Países del CAS - Análisis de Capacidades Técnicas e Institucionales – Chile, FAO, http://www.fao.org/3/i8158s/i8158s.pdf.
[13] Food and Agriculture Organization of the United Nations (2014), Understanding the drought impact of El Niño on the global agricultural areas: An assessment using FAO’s Agricultural Stress Index (ASI), http://www.fao.org/3/a-i4251e.pdf.
[8] Ministry of Agriculture (2018), Exempt Resolution N° 247, 31 May 2018.
[6] Ministry of Agriculture (2018), Memoria 2014-2018. Sub Departamento de Información, Monitoreo and Prevención (Ex UNEA) Sistema Nacional de Gestión de Riesgos Agroclimáticos.
[7] Ministry of Interior (1974), Crea la Oficina Nacional de Emergencia. Executive Decree 369.
[10] Ministry of Interior and Public Security (2018), Mediante el cual se aprobó el Plan Estratégico Nacional para la Gestión de Riesgo de Desastres. Exempt Decree N° 3453, 4 December 2016.
[11] Ministry of Interior and Public Security (2018), Mediante el cual se aprobó la modificacion el Plan Estratégico Nacional para la Gestión de Riesgo de Desastres. Exempt Decree 290, 29 January.
[9] Ministry of Interior and Public Security (2002), Aprueba Plan Nacional de Protección Civil. Decree N° 156, 12 March, https://www.resdal.org/caeef-resdal/assets/chile---decreto-n%c2%b0156-onemi-plan-nacional-de-grd.pdf.
[1] Université catholique de Louvain (UCL), B. (ed.) (2019), The OFDA/CRED International Disasters Database, http://www.emdat.be (accessed on 5 January 2020).
[12] Vega, J. (2020), Agroseguros, Internal FAO presentation in Chile.
Notes
← 1. INDAP focuses on family farming and related organisations, among others, it co-finances technical assistance and services to this type of farm. It also contributes to follow up actions after agricultural emergencies by providing trainings on agroclimatic risk management to farmers and agricultural extensionists and by developing disaster risk reduction programmes.
← 2. MINAGRI has made progress in setting up a system to assess damages and losses caused by disasters in different sectors, in order to comply with the 2015-2030 Sendai Framework for Risk Reduction and the Sustainable Development Goals.
← 3. The Agroclimatic Risk Observatory Platform is accessible via http://www.climatedatalibrary.cl/IMP-DGIR/maproom/.
← 4. The data library and maps can be accessed via http://www.climatedatalibrary.cl/.
← 5. During El Niño-Southern Oscillation episodes, the normal patterns of tropical precipitation and atmospheric circulation are disrupted, hence triggering extreme climate events around the globe: droughts, floods and affecting the intensity and frequency of hurricanes. Agriculture is one of the main sectors that can be severely affected by the El Niño phenomenon (Food and Agriculture Organization of the United Nations, 2014[13]).
← 6. See for more information on Agroseguros, see https://www.agroseguros.gob.cl/.
← 7. The unidad de fomento or UF is a Chilean currency unit indexed to inflation. For reference, the value of the UF on 10 February 2020 was USD 28 352.33 (approximately USD 36).