Agrometeorological Risk Management Russian Experience Prof Alexander Kleschenko

Agrometeorological Risk Management: Russian Experience Prof. Alexander Kleschenko National Institute on Agricultural Meteorology Obninsk, Russia 1 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

«From year to year droughts, frosts, lack of show, hot winds, hailstorms and other atmosphere adversities spoil our fields and provoke tremendous losses in our economy … droughts and frosts go on with their baneful activity, as usual take away hundred millions rubles from the state budget, destroy hopes of owners, and shake faith in science» Prof. P. I. Brounov From the report on the First Meteorological Congress at the Imperator Academy of Science. Saint-Petersburg, January 25, Total yield of cereals in Russia, mln. t 2008 108. 2 2010 61. 0 1900 Shortage of yield due weather 47, 2 mln. ton 43, 6% 2 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

ФГБУ «ВНИИСХМ» 3 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Topics • Information about our Institute • Losses from Weather Phenomena & Benefits from Hydro-meteorological Information • The procedures of Risks Management • The Attitude to Risks Management • Techniques for Agro-meteorological Risks Evaluation • Trends, Expectations, Further Developments 4 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

About us • The Institute was established in 1977 • 92 employees, including 7 professors and 15 researches with Ph. D. • Aim: to investigate and to understand weather and climate influence on crop growth, development and productivity 5 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

About us • The types of activity – Development of new techniques and procedures – Preparation of forecasts, reviews and reports • The areas of activity – Forecasting, modeling, monitoring, climate change, agrometeorological observations, agroclimatology, remote sensing 6 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Losses from Weather Phenomena Industry Hazard Events (1986 -1991 ) Losses, Billions of Ruble Agriculture 494 82, 1 Fuel & Energy 505 13, 7 Municipal economy 304 12, 2 Auto & railway transport 606 15, 5 Construction 77 9, 4 Forestry 113 4, 3 7 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Events of Weather Phenomena 8 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Benefits from Hydro-meteorological Information in 1993 (million US$) 1 – Agriculture 2 – Fuel & Energy 3 – Auto 4 – Aviation 5 – River shipping 6 – Housing services 7 – Shipping 8 – Строительство 9 – Others Meeting on Risk Transfer , Geneva, December 13 – 14, 2011 9

Benefits from Hydro-meteorological Information in 2005 No Industries Profit Estimate, Millions of Ruble % 1 Industry Agriculture Forestry Fishing Transport & communication 4 273, 7 30, 8 1 274, 5 9, 2 274, 3 2, 0 174, 5 1, 2 5 618, 9 40, 5 2 3 4 5 5. 1 railway 462, 5 3, 3 5. 2 auto 556, 6 4, 0 5. 3 pipe 50, 1 0, 4 5. 4 sea 783, 9 5, 6 5. 5 river 769, 3 5, 5 5. 6 air 2 575, 9 18, 5 5. 7 -5. 9 others 289, 7 2, 1 5. 10 Communication 130, 7 0, 9 438, 6 3, 2 45, 0 0, 3 1 209, 1 8, 7 437, 0 3, 1 140, 9 1, 0 13 886, 50 100, 0 6 7 -14 15 16 17 -24 Total Construction Others Housing services Water industry Health protection, etc. Meeting on Risk Transfer , Geneva, December 13 – 14, 2011 10

Utilization of Hydrometeorological information losses prevented 1 – Agriculture 2 – Shipping possibility to prevent losses Unavoidable losses 3 – Construction 4 – Aviation Meeting on Risk Transfer , Geneva, December 13 – 14, 2011 11

Winter cereals crop death 12 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011 8

13 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

14 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

15 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

The results of 2010 drought Crop death from drought on the area of 13 200 000 hectares That figure is equal to: • 29% from planted area affected by drought • 17% from Russia planted area • 30% from planted area occupied by cereals 16 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Risk management - Theory • • Definition of Risk Process of Risk Management Tools for Risk Assessment Risk-based Decision-making 17 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Risk Combination of the probability of an event with the impact that event would have Seriousness DANGER Seriousness Probability 18 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Risk management To develop and maintain the procedures Hazards identification Risks evaluation Risks control 19 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Some hazards • Weather hazards – Frosts – Droughts – Floods – Sand storms • Pests, diseases • Equipment failures • Problems with market, etc. 20 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Risk management To develop and maintain the procedures Hazards identification Risks evaluation Risks control 21 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Some tools • Pareto Analysis • Change Analysis • What – if Analysis • Failure Modes and Effects Analysis • Hazard and Operability Analysis • Fault Tree Analysis • Event Tree Analysis • Etc. 22 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Risk management To develop and maintain the procedures Hazards identification Risks evaluation Risks control 23 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Risks Control There are some techniques for risks control • Terminate – To avoid equipment failures do not use any machinery • Treat – To replace with alternative technology • Tolerate – To accept • Transfer – To use subcontractors 24 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Situation in Russia. . . • The risk management systems are used seldom • In agriculture the decision making process is not based only on forecasts or reviews • Farmers usually suffer from more serious problems – credits, price gap, depreciated machinery, etc. 25 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Situation in Russia • Only a few agro-meteorologists hear something about risk management • The insurance market was very small in previous years but now there is some progress: – The insurance law was adopted this year – There is the state support for agriculture insurance in general and for farmers in particularities 26 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Draft of procedure • Name: agro-meteorological support of agricultural insurance in Russia • 1 – List dangerous phenomenon • 2 – Criteria for dangerous phenomenon • 3 – Expertise procedure • • Requirements for the request Structure of the expert opinion Information support Technology of preparation • 4 – Examples 27 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

The farmer demands • End-users are interested in different meteorological and agro-meteorological products: – Weather forecasts – Weather hazard warnings – Forecasts on snow melting – Forecasts on the date of field work beginning – Expected conditions on crops wintering 28 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011

Thanks for your attention 29 Meeting on Risk Transfer , Geneva, December 13 – 14, 2011