Dodging risks on the field

Human beings are constantly putting their senses in tune with the environment where they live to minimize risks, which are everywhere. Therefore, during evolution, we accumulated multiple senses, such as hearing, vision, touch, smell and taste, which function in a similar way to a sophisticated system that is constantly on alert and keeps us alive in a world full of dangers. 

Risk is, in fact, the effect of uncertainty on everything around us – businesses, companies, governments – including our own survival. As uncertainty is a constant in our lives, our instincts have evolved to manage and avoid risks. If we burn our finger by lighting a matchstick for the first time, we will be extra careful when doing it a second time.

Risk management in the field is a strategic topic for Brazil, since a large part of our agricultural activities are carried out in the open, exposed to all types of uncertainties. Although the causes of risk in the field are more associated with climatic and biological factors, farmers are also subject to unpredictable variations in several other instances, such as regulatory, market, credit, societal perceptions and expectations, among others. 

Such pressures have multiplier effects that spread far beyond crops and livestock, due to impacts on income, supply, job losses and tax collection. Therefore, failures in risk management in the field can lead to severe losses in the production of goods that affect many other components of the economy — commerce, industry and services —, in addition to worsening situations of poverty and exclusion in the poorest regions.

There is much evidence of expanding pressures and risks on agricultural production. Climate change is already producing intensification of thermal, water and nutritional stresses, with increasing risks to natural resources and production. Therefore, we need technological innovations capable of identifying trends and patterns, expanding the human capacity to analyze and interpret highly complex uncertainties and enabling effective ways of managing risks in the field.

Fortunately, Brazil is taking solid steps in this direction. Two decades ago, the lack of risk management in farming led to severe losses and farmers queuing up at banks, renegotiating debts. To overcome this difficulty, Embrapa mobilized a large network of partners and integrated massive volumes of climate, soil and crop data in order to define times and places with the lowest risk of losses in the production of our crops.

Hence the Agricultural Climate Risk Zoning (ZARC), an agricultural policy and risk management instrument that covers 44 types of crops throughout Brazil. The result is easy to use by financial agents, technicians and producers and brought savings of around R$ 16,8 billion to Brazilian agribusiness in 2018 alone. These are losses that the country no longer suffered due to crop losses and the security indemnities they would cause.

It is certain that the future will be full of risks and uncertainties, but the good news is that we live in a world marked by the dizzying production of knowledge and technological advances. Therefore, ZARC's success attests to Brazil's ability to innovate to build a less risky future for our farmers and consumers.