During the first 3 years of the project, the G4AW subsidy is used to set-up the G4INDO service. The work consists for a large part of the integration of the geo-data, meteorological and crop growth modelling components into the insurance scheme. This requires a substantial amount of knowledge transfer and training on the topics of satellite data processing, weather forecasting and crop growth modelling. At the same time, revenues from the insurance premium will start to come in after the first year of operations during the project execution. The revenue flow is however much too low (due to the relative low number of clients) to be able to cover the cost and hence the operation is not profitable during these three years. After three years, the work on integration of G4INDO into the insurance scheme is finished, lowering the cost significantly. The remaining costs of operation are in year 4 of the operation (slightly) lower than the revenue, making the operation profitable for the first time. Profits increase due to the increasing number of insurance takers from year 4-10, faster than the rising of the cost because the scale of operation. This makes the service financially sustainable from year 3.

G4INDO is aimed at smallholder rice farmers on Java, Indonesia. These farmers typically have land holdings smaller than 2 hectares, many of them have even less than 1 hectare. Land ownership is also highly fragmented and parts of the fields are cultivated on a sharecropping basis.

Geodata for upgrading small holders’ farming systems in Indonesia

The Indonesian Government has decided to develop a crop insurance policy to assist farmers and to boost food security. The G4INDO project provides technical assistance in assessing crop yield anomalies at plot scale. The project will provide crop insurance and third crop feasibility advice to 200,000 farmers. Processed satellite data such as radar and optical earth observations provide the necessary information. This is combined with weather monitoring, analysis and fore casting, crop models, and hydrological models. The Indonesian Ministry of Agriculture and the Insurance companies can use this integrated information to assess claims from service contract holders experiencing harvest losses. The project also supports the cropping calendar of the Ministry of Agriculture, by advising whether a third rice crop can be expected to receive suffi cient rain.

The primary purpose of the G4INDO project is to assist the Government of Indonesia in its efforts to formulate and implement a financially viable and sound crop insurance policy for smallholder rice-based farmers. More in particular, the project will: • provide technical assistance to the design and implementation of the crop insurance policy in general and to 200,000 farmers in particular. • Monitor the growth of rice crops of 200,000 farmers using radar and optical satellite technology. • Analyse deviations from expected crop development and yields using weather information and crop growth models. The secondary purpose of the project is to: • Provide 200,000 farmers with seasonal forecasting information and expected crop yields supporting decision-making of farmers on growing a third crop. This information reaches the farmers through the agricultural extension system of the Ministry of Agriculture.