Swiss-based food and beverage giant Nestlé has unveiled a pilot initiative designed to offer weather insurance to small-scale coffee farmers within its Nescafé supply chain. The move responds to the challenges posed by climate change, which has left these farmers vulnerable to unpredictable weather patterns impacting coffee crops.

This program, developed in collaboration with climate insurance specialist Blue Marble, employs satellite-based climate data to assess the impact of irregular rainfall on coffee production during crucial crop growth phases. Compensation is automatically disbursed to affected farmers based on the severity of the weather conditions.

The pilot is currently underway in Indonesia, benefitting over 800 smallholder coffee growers. Depending on its results, Nestlé intends to potentially expand this effort to other Nescafé sourcing regions.

Jaime de Piniés, CEO of Blue Marble, noted the vulnerability of Indonesian smallholder coffee farmers to climate risks and emphasized the need for insurance to protect against extreme weather events.

This initiative aligns with Nestlé’s Nescafé Plan 2030, a comprehensive strategy aimed at enhancing the sustainability of coffee farming and aiding farmers in transitioning to regenerative agricultural practices. The plan, covering key coffee-producing nations like Brazil, Vietnam, Mexico, Colombia, Côte d’Ivoire, Indonesia, and Honduras, involves investments exceeding 1 billion Swiss Francs (approximately USD$1 billion) by 2030.

In addition to the insurance program, Nestlé has contributed to a guidebook on regenerative agriculture, emphasizing knowledge-sharing and supporting coffee farmers in adopting sustainable practices, crucial for climate change adaptation and mitigation. The global head of sustainable agriculture development of Nestlé, stressed the importance of these practices and hoped the guidebook would facilitate their widespread adoption among farmers.

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