Disaster risk management in agriculture: tragedies of the smallholders

Agriculture sector is exposed to a variety of risks and uncertainties which can lead to sizeable losses in crop yields and alter farm incomes. Risk management is, therefore, an essential element of the overall farm management process. Farmers have number of options in managing farm risks; however, smallholders, due to their small operations and limited financial capabilities, find it difficult to adopt sophisticated risk management strategies to overcome yield and income instabilities at farm level. This study is, therefore, designed to investigate the enabling environment for small farmers to manage climatic risks at farm level. A total of 330 sampled respondents from Khyber Pakhtunkhwa Province of Pakistan are randomly selected for the study using multistage sampling technique. Analysis of variance technique is employed to compare the risk management adoption decision of small, medium and large farmers. A post hoc analysis is also performed to highlight the difference in means and the magnitude of differences. The results indicate that smallholders have significantly lower access to credit (both formal and informal), formal information sources along with significantly higher perceptions of pest and diseases. Smallholders are also at the tail end in the adoption of precautionary savings and agricultural credit to manage climatic risk at farm level. The study urges for risk management policies particularly in favor of the small farmers and intervention in the existing information and credit provision programs to facilitate smallholders in managing farm risks.