Crop Damage Statistics by Cause of Loss

33. 
    An average of at least 2.4 percent of the cultivated paddy area is lost every year due to natural disasters. The analysis of BBS’s regional-level crop-cultivated area damage statistics for the period 1990–01 to 2005–06 shows that, in an average year, 2.4 percent (613,000 acres) of the total cultivated area of paddy crops is lost due to a combination of all the listed natural perils. However, in the worst loss year in this series, 1998–99, 2.0 million acres of paddy were totally destroyed, equivalent to 8.2 percent of the total cultivated (harvested) paddy area. In 1991, 1.9 million acres (7.4 percent of total area) were destroyed, and in 2004 a further 1.9 million acres (6.9 percent of total paddy area) were also 100 percent destroyed by natural perils (figure 3.3.). Nevertheless, it is important to stress that this analysis underestimates true crop-area losses as BBS reports only the crop areas 100 percent damaged, and their statistics do not include partial crop-damaged areas or yield loss caused by these natural perils. Furthermore, drought area losses are not available from the BBS records.
    
34. 
    Excess rainfall and flood is the main cause of loss, accounting for 63 percent of the total area losses during the 16 year period (figure 3.4), and the most severely affected Districts include Dhaka, Tangail, Jessore, Rajshashi, and Pabna. Hailstorm and tornado²⁹ is the second most important cause of loss, representing 15 percent of the total paddy area losses; the most affected Great Districts by hail and tornado were Sylhet, Chittagong, and Bogra. Flash floods accounted for 12 percent of total paddy losses on average during the reference period and cyclone and tidal bore for 10 percent of total area losses in paddy.³⁰
    

Source: Bangladesh Bureau of Statistics.

35. 
    This section describes the crop-yield risk assessment at the great-district or regional level in Bangladesh. The principle objectives of the regional crop-yield risk assessment are to assist decision makers in assessing the spatial distribution of crop production values and to quantify the risk of crop production and yield loss for major crops in each of the 34 great-districts/regions which the country can be divided into. A separate and detailed crop-risk assessment for area-yield crop insurance rating purposes has also been conducted for boro HYV and aman HYV crops grown in three selected Districts, Bogra, Dinajpur, and Pabna, and this District-level analysis is presented in chapter 4 and in annex 7.
    

1. 
   The Crop Risk Assessment Model at Regional level (CRAMR) described in this section is based on an analysis of variation in regional time-series annual average crop yields for the 7 varieties of aus, aman, and boro paddy rice and the single boro HYV wheat crop grown in Bangladesh. The reason that this model is performed at the regional or great-district level and not at a lower level of disaggregation is because the BBS publishes official crop production, area, and yield data only at the regional level.
   
2. 
   The key underlying crop production, yield, and valuation data and assumptions which the CRAMR model for Bangladesh is built on include the following:
   

• 
  Selected crops: the seven major paddy crops, aman HYV, aman LTV, aman LBV, boro HYV, boro LV, aus HYV, and aus LB, as well as boro wheat, for which regional-level³¹ crop area, production and yield data are available for the past 39 years, 1969–70 to 2007–08.
  
• 
  Cultivated area: In order to remove seasonal variation from the cultivated and harvested area in each District, the model takes the average harvested area for each crop for the past three seasons: 2005–06, 2006–07, and 2007–08. The model then assumes that the cultivated area has remained constant over the past three years. For the purposes of the risk analysis exercise, the minimum cropped area in any one great-district or region is set at 10,000 acres for all eight crops.
  
• 
  Crop yields: the crop yields are based on the BBS’s reported regional average yields (total production, in metric tons, divided by harvested area (acres). These yields have then been adjusted to represent average yields on a sown area basis by adding back in the 100 percent total area losses declared by BBS for the period 1990 to 2005. For the purposes of eliminating the effects of the increase in yield due to technology improvements (seed genetics, crop management practices, use of agrochemicals, etc), the 39-year historical yields have been de-trended and readjusted to an expected yield based on the most recent five-year average.
  
• 
  Crop output prices: the eight crops are valued at the published 2007–08 average farm-gate gross margin sales prices for Bangladesh, which are detailed in annex 6.
  

38. 
    Assessing yield Losses and value of losses for CRAMR: The risk assessment model assumes that the losses occur when the actual average Great District yield for a specified crop falls short of the regional expected yield, defined as the average yield for the most recent five crop years. In any year where the actual yield is below the regional average expected yield for each crop, the amount of yield loss is calculated as a percentage of the expected yield to derive the pure loss cost (loss/gross value of production x 100 percent). The average pure loss cost for each crop is then calculated as a simple average over the 39 years of yield data.
    
39. 
    In summary, the CRAMR uses a historical database of 39 years of harvested yield data, adjusted by (i) the100 percent area losses to represent more accurately the average yields sown area-basis and (ii) technological improvements in crop yields for all major crops grown in all 23 great districts of Bangladesh in order to establish the expected value of losses and to estimate probable maximum losses for the national portfolio. Full details of the assumptions used in the design of the CRAMR are contained in annex 6.
    

40. 
    The total values at risk (VAR) for the analyzed eight-crop cereal portfolio, assuming 100 percent normal average yields, amounts to Tk 400.3 Billion (US$5.9 Billion). The highest values at risk are for the Rabi crops (boro HYV paddy, boro LV paddy, and wheat) accounting for 58 percent of the portfolio’s VAR or Tk 232 million. In second place are the Kharif paddy crops (including aman HYV, aman LBV, and aman LTV) accounting for 38 percent of VAR or Tk 151 million. Finally the pre-Kharif crops—aus HYV and aus LV paddy—account for only 4 percent of the total portfolio VAR or Tk 17.3 billion. (See annex 6 for details).
    
41. 
    A proper portfolio peak risk analysis should be conducted in the planning of any public-private crop insurance program for Bangladesh. The temporal distribution of VAR is determined by the length of the crop cycles, the predominant cropping patterns, and the crop prices that will impact directly on the exposed values. In Bangladesh; the temporal distribution of VAR for major crops presents two main peaks. The major peak in exposed crop values of Tk 232 billion is reached during the Rabi season in the month of February when boro paddy and wheat crops are maturing in-field prior to commencement of harvest. (See figure 3.5. for monthly distribution of crop VARs). Major cyclone or hail events in this period will cause major crop losses. The second peak in VAR of Tk 151 billion applies to aman paddy grown in the Kharif season in the months of August and September prior to the commencement of harvest. The VAR for these major cereal crops is at its lowest in November following the harvest of the Kharif aman paddy crop and again in May following the harvest of Rabi season boro paddy and wheat.
    
42. 
    The spatial distribution of Kharif paddy crop VARs is directly related to the flood exposure and land-use type, and for Rabi crops on the availability of irrigation facilities. Pre-Kharif crops regional VARs are low and homogeneously distributed throughout Bangladesh. For Kharif monsoon paddy crops, VARs tend to be more concentrated in the western part of the country, and Rangpur Great District has the largest concentration of crop values at risk in the Kharif season. For Rabi paddy and wheat crops, VARs are concentrated in the central and northern regions of Bangladesh, including Rangpur, Jessore, Comilla, and Rajshashi Great Districts. The spatial or geographical distribution of paddy and wheat VARs is shown in map 3.5. for pre-Kharif or Aus paddy, Kharif or Aman paddy, and finally Rabi crops of Boro paddy and wheat.
    

Source: Authors

Source: Authors from BBS data.

Source: World Bank from BBS data.

1.