India is an example of an economy still developing rapidly but already accepting weather risk management techniques right down to the end-user level. The latest news we’ve come across involves the soft drinks (and other products) manufacturer Pepsico.
Their India branch has entered into a weather insurance deal with ICICI Lombard. They revealed that the deal will cover 50,000-60,000 acres involving around 40,000 farmers in ten states under a weather insurance deal for potato seeds. The aim is to secure a supply of high quality potatoes to meet the demand for their arm which produces snacks such as crisps. Pepsico requires 150,000 tonnes per year to produce enough snacks to go round. By putting this deal in place they are helping to protect their supply as well as protect the farmers.
It’s an interesting scheme and further evidence of their appetite for risk management.