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On the evening of April 29, T Subaida from Adikattukulangara village in Kerala’s Alappuzha district discovered her only Jersey cow dead in its shed. Initially suspecting poisoning from grazing on nearby vacant land, a post-mortem revealed the cow had succumbed to heat stroke. The loss had a huge financial impact on Subaida, who relied on selling milk to sustain her household during non-farm seasons.
In contrast, livestock farmer Mali Ram Sharma from Ghinoi village in Jaipur, Rajasthan, feels more secure despite the unusually hot April and May. “For the first time, I have taken out insurance this year, which promises fixed compensation if the milk production of my livestock dips due to high tem-peratures,” says Sharma. Noticing a steady decline in milk yield during the peak summer months over the past five years, Sharma decided on insurance. “A cow in my village usually produces 20 litres of milk a day. In the current heat, the yield has dropped to just 16 litres,” he says, adding that his insurer, a private Patna-based agritech company called DeHaat, which started cattle insurance for the first time this April, will calculate the compensation amount in mid-July.
India is experiencing intense heat stress this year, with the India Meteorological Department (IMD) reporting heatwaves in 14 states and Union Territories in April, and in 24 in May. Unusual temperatures have become a recurring problem for the country, which has recorded 12 of its warmest years since 1901 in the past 15 years.
Heat stress has harmful consequences for animal health and productivity. Animals have a thermal comfort zone optimally suited to their physiological functions. When temperatures exceed this threshold, it leads to heat stress, metabolic disorders and immune suppression among livestock. Dairy cows are particularly susceptible. A March 2022 study in The Lancet notes that cattle can experience thermal stress at temperatures above 20°C. It estimates rising temperatures could reduce milk production in India’s arid and semi-arid regions by 25 per cent by 2085.
Given the crisis, private and government players are gradually introducing insurance schemes. The initiatives are in their early stages and limited to specific districts. The current schemes are all parametric, meaning insurance is based on the occurrence of a specific event, with compensation amounts tied to the event’s magnitude rather than the actual losses incurred.
India, the world’s leading milk producer, heavily relies on its dairy sector, employing over 8 million people, most of whom are small and marginal farmers. These farmers face substantial financial losses as milk production declines due to heat stress. In Kerala, the first state to roll out a livestock insurance scheme in 2023, the typical summer decline in milk production has worsened, with farmers reporting a drop of up to 45 per cent this year compared to the usual 15 per cent.
Officials from the Kerala Co- operative Milk Marketing Federation, known as Milma, tell Down To Earth (DTE) that the federation typically sells 1.7 million litres of milk daily. However, this April and May, it faced a shortfall of 0.65 million litres, which it supplemented by sourcing milk from cooperatives in Maharashtra and Karnataka. In collaboration with the Agriculture Insurance Company of India, Milma launched the Saral Krishi Bima in select districts last year. Under the scheme, farmers receive Rs 200 per cattle if the temperature in the taluka exceeds a set limit for six days, with higher payouts for longer durations (see ‘A safety net for livestock’). The threshold is fixed for each taluka, based on historical maximum temperature data from the past 45 years. “We take a weighted average, with higher weight given to the last five years’ data,” says Balachandran M K, head of growth for Asia at IBISA, an international non-profit that helped design the scheme.
The premium is Rs 110 per cattle, partially covered by Milma (Rs 53) and the remaining by local milk producer unions. This year, over 84,000 cattle were in-sured under the scheme.
K G Kannadas, a dairy farmer in Palakkad district enrolled under the scheme, says that despite measures to keep his cowsheds cool, such as installing fans, the stress on the cows has been unprecedented. “Without insurance and gov-ernmental support, no dairy farmer can survive,” says Kannadas.
The Kutch Milk Union in Gujarat has also rolled out a similar scheme for its members, offering a compensation of up to Rs 2,000 in case of extreme heat for a premium of Rs 100 per cattle. Private agritech company DeHaat has introduced cat-tle insurance schemes in select districts in Rajasthan, Madhya Pradesh, Uttar Pradesh, Bihar, Maharashtra and Jharkhand. The scheme offers free and paid versions, with compensation amounts based on tempera-ture thresholds.
Though much needed, the current insurance schemes are far from perfect. In Kerala, for instance, the scheme runs only for two months, from March 1 to April 30, despite the heatwave continuing well into May. K S Mani, chairperson of Milma, says that the expectation was for the heat situation to subside by early May, with intermittent heavy summer rains bringing relief. “The climatic situation has worsened this May. However, we have no funds to extend the insurance for one more month. The facility ended on April 30 and will resume on March 1 next year for another two-month term,” he says.
Meanwhile, DeHaat provides insurance only to farmers who purchase the company’s fodder. “We had to authenticate that only dairy farmers who sell milk can buy the insurance; otherwise, a farmer with one animal for personal use would also buy it. Our reach is limited to our network, but selling insurance is tough because we are not an insurance company,” says Digvijay Singh, head of dairy input at DeHaat. The current schemes also do not factor in humidity. “When we talk about heat-induced stress in dairy cattle, it is a combination of temperature and humidity. We lack good data sets to measure humidity. Once we have that, we can im-prove the product,” says Balachandran.
India must also learn from global experiences. Kenya was among the first countries to roll out a livestock insurance programme in 2015, when the country was reeling under a drought. The scheme had to be discontinued in 2021 because of the rising compensation demands that made it unfeasible. The country paid a cumulative compensation of 1.2 billion Kenyan shillings (US $8.8 million) between 2015 and 2021, before replacing the scheme with DRIVE, a financial savings programme for pastoralists. It has a minor insurance component.
Europe has also rolled out its Heat Stress Protect programme for dairy farmers, and it is much more holistic than the schemes currently in India. It covers economic losses, including milk production and quality, reproductive efficiency, cow health and labour losses.
While the importance of insurance programmes will grow, India also needs to look at other solutions to make cattle resilient to external heat. “Insurance is a disaster relief mechanism.
We need preventive solutions like improving infrastructure and practices so that farmers do not have to rely solely on insurance,” says Nirmita Chandrashekar, senior programme manager at SELCO Foundation, a non-profit that offers cooling solutions to livestock rearers. One of the solutions could be the introduction of hydroponics (the technique of growing plants using a water-based nutrient solution rather than soil) at dairy farms to improve feed quality and animal health, which enhances resilience to heat. An advisory issued on April 16 by Abhijit Mitra, Animal Husbandry Commissioner, Union Ministry of Fisheries, Animal Husbandry and Dairying, highlights the importance of high-quality nutritional feed for supporting immune systems and resilience against heat.
“We also need to look at infrastructure improvements. For instance, in north Karnataka, we can use thermal wraps un-der roofs for insulation. In areas with higher temperatures and humidity, we can introduce polyurethane foam panels, which drop temperatures by 4oC,” says Chandrashekar. These solutions need to be integrated into government schemes like Rashtriya Gokul Mission and National Programme for Dairy Development to help build the resilience of farmers to multiple shocks, she adds.
This was first published in the 1-15 July, 2024 print edition of Down To Earth