Food security: our greatest emerging risk?

The Monte Carlo Rendez-Vous de Septembre is such a fascinating beast. Amidst the azure glories of the Mediterranean, the fin de siècle wonders of Casino Square, and the bombastic posturing of the many supercars parked around the place, it’s a wonder that any real business gets done at all. 

The reality though, at least these days, is different. I suspect that once one strips away the baroque splendours and grotesques of the place, the (re)insurance market does get down to some fairly gritty details around renewals, or at least sets the tone. And there is certainly some really interesting intellectual capital to feast on these days to go alongside the cost of capital discussions.

One of the highlights this year was the keynote speech by Scor’s recently installed CEO Thierry Léger (pic)  at the PwC breakfast briefing, and event which has grown in stature in recent years.

Léger dwelt on several thought-provoking topics around the world of risk, but one which stood out for me was the issue of future food security, a subject which has been sorely overlooked to date but one which I can’t help feeling will become a major talking point in coming years.

In summary, he suggested that increased temperatures will accelerate crop development, with the result that the growth period shortens and yield decreases. Eratic precipitation will also be an issue, with the scientific literature suggesting that for a country such as India, for example there are more dry days and more days with intense precipitation to come, which will have a negative impact on crop yield. Finally, the impact of rising carbon dioxide concentrations is a massive source of uncertainty with regard to future crop yields.

It’s clear to see that all of this will an enormous emerging risk in years to come, and one whose repercussions in terms of scarcity of supply and social & political unrest could be enormous. How does the market respond to this? Over to you…

Marcus Alcock,

Editor, Emerging Risks