THE NEED FOR RISK ASSESSMENT BY FIELD CROP FARMERS

The risks confronted by field crop farmers are of great interest to me, this is because, each year, they experience new risks and challenges as field crop farming is really volatile .

Risk assessment is highly pertinent to assist farmers make informed decisions before/during an entire planting cycle. Far from conventional beliefs, its need does not only arise in risky situations, but serves as a leverage and protection in decision making.

Risk management commences with identifying the crucial risks faced,understanding the potential impacts of contingencies; and taking possible steps to prevent or lessen the impacts. Some common risks have been identified based on a one-on-one interview with 78 field crop farmers in Iwo town, Osun state, South West Nigeria; and strategies to mitigate them have also been provided below:

1. Crop Production Risks

This entails the probability that your output levels will be lesser than expected. The factors may arise from pathetic weather conditions, damage due to animal invasion, insects and diseases, etc. Examples are the complex challenges of climate change, like we witnessed last year which ranged from excessive flooding in Kebbi State to cessation of rainfall in Osun State.

A 5-ACRE RICE FARM FLOODED BY EXCESSIVE RAINFALL IN IWO,OSUN STATE,NIGERIA.

Preventing these risks include:

· Employ recommended best practices. Use improved seeds, follow best land preparation and planting guidelines.

· Decide on what to plant. Don’t sow because other farmers are keen on a particular crop. Plant crops based on PBP, ROI, government policies and weather adaptation.

· Insure your farm.

· Irrigate your farm.

· Advisable you reduce acreage if irrigation facilities are not available than lose much due to climate change effect.

· History of site selection is important. Ask questions, conduct soil analysis and do not assume.

2. Marketing Risks

This is associated with fluctuations in sales or prices of your products. Lower sales and prices may arise due to increased competitors, loss of market access, change in preferred product or packaging standards.

A FARMER’S WATERMELON HARVEST READY TO BE CONVEYED TO THE OPEN MARKET IN IWO,OSUN STATE, NIGERIA.

Preventing these risks include:

· Get an off-taker agreement. This is advisable for large acreage cultivation of perishable crops.

· If you have an off-taker agreement, be prepared to review stipulated prices when factors like scarcity, inflation and government policies make it inevitably necessary. It must be a win-win situation.

· Be realistic with your sales forecast and prices before cultivation.

· Develop a marketing plan.

· If your target market is the open market, please join a cooperative so as to have a formidable price tag.

· Limit middlemen engagement.

· Do not rely on a single market.

· Consider storage when the prices of harvested crops are not favourable.

3. Financial Risks

Apart from farmers interview, this is also a personal experience. A field crop farmer’s financial risks may arise from fluctuations in interest rates from investors, inability to repay borrowed capital, generating lower than expected profits, excessive borrowing, family needs, losing equity or net worth and cash flow difficulties.

Preventing these risks include:

· Keep your farm off family expenditure.

· Never use your personal account for financial deals, your farm is a separate entity.

· Cost minimization is pertinent.

· Utilize existing structures as possible alternatives.

· Set aside contingency funds. If you are on an out-grower scheme, set aside provision funds to repay stock deficits in cash.

· Understand business agreements and never assume.

· If you have an off-taker agreement, be prepared to renegotiate stipulated prices if inevitably necessary. It must be a win-win situation.

· Rent or lease machinery, land and other equipment instead of purchases. Acquisition of such asset may be more appropriate during expansion.

· Remember, Cash remains king.

4. Human Resource Risks

Human resources management in field crop farming is a big deal. Experiences span sickness of farm hands, decampment, stealing, shortchanging diesel, selling off herbicides to neighboring farmers, and in fact death. The effect of any of these happenings can be so disastrous to a farm and the farmer.

Preventing these risks include:

· Employ technology and reduce human work-load to the minimum.

· Outsource farm activities or employ daily/ part-time labourers.

· Train your workers or get experienced workers.

· Good health practices. In case of sickness, do not practice self- medication.

· Ban the use of drugs such as tramadol and cannabis, though these drugs are believed to aid performance, nonetheless they have health and legal consequences.