Njala Insurance: The Case for Paying Zambia's Drought Cover in Maize, Not Kwacha

By The Zambian Economist Analyst | Lusaka | 26 August 2026

A 2023 proposal by Kampamba Shula would have smallholder farmers contribute five bags in every hundred to a regulated grain reserve instead of paying cash premiums. With forecasters near-certain of a very strong El Niño over the 2026/27 season, the idea deserves a hearing.

Editor’s note: This article was initially authored by Kampamba Shula and first published on www.katondostreet.com. It has been edited, fact-checked and updated for The Zambian Economist with figures on the 2023/24 drought, the 2024/25 harvest and the developing El Niño. Shula’s original essay draws on his 2023 paper, Njala (Hunger) Insurance: Pharaoh and Joseph Climate Change Adaptation Strategy in Zambia.

Key takeaways

Njala Insurance, proposed by Zambian economist Kampamba Shula in 2023, would let a smallholder pay drought cover in grain rather than cash: five of every hundred bags harvested go into a regulated community reserve that returns food, seed or money when a defined climate shock hits.
The 2023/24 El Niño drought cut Zambia’s maize harvest by 53.6% to roughly 1.8 million tonnes, affected 9.8 million people across 84 of 117 districts and forced imports of about a million tonnes. The US Climate Prediction Center now puts the probability of a very strong El Niño late this year above 90%, and FEWS NET expects below-average rainfall and extreme heat across Southern Africa from October to March.
Most of the machinery already exists. Index insurance bundled with the Farmer Input Support Programme paid more than K800 million to over 500,000 farmers after the 2023/24 season, and the Food Reserve Agency’s reported purchases passed 1.2 million tonnes in the 2025 marketing year.
The open questions are institutional: who stores the grain, who audits it and what triggers a release. A voluntary pilot in drought-prone districts would answer them for a fraction of the cost of the next emergency import bill.

Njala Insurance is a food-security scheme proposed in 2023 by Zambian economist and writer Kampamba Shula, under which smallholder farmers pay their drought cover in maize instead of kwacha. A farmer harvesting a hundred bags would deposit five into a reserve held at a cooperative or accredited warehouse. In a bad season, with the trigger set by rainfall and crop data rather than ministerial discretion, the reserve pays back food, seed or cash. Njala is the Bemba and Nyanja word for hunger.

The idea is back in season for an uncomfortable reason. The US Climate Prediction Center assesses a greater than 90% probability that a very strong El Niño will run through the northern-hemisphere winter, and Columbia University’s IRI puts El Niño probabilities at 100% from this August to February 2027. FEWS NET projects below-average rainfall and extreme heat for Southern Africa between October 2026 and March 2027, the span of Zambia’s next farming season. Zambia has been here before, recently, and the bill is on record.

An old rule about field edges

The proposal’s starting point is not a modern actuarial text. Leviticus 19:9 and 23:22 instruct farmers not to reap their fields to the edges, and Deuteronomy 24:19 tells them to leave a forgotten sheaf behind rather than collect it. What stayed in the field was provision for the poor. Joseph’s reading of Pharaoh’s dreams, seven years of plenty followed by seven of famine, carries the same instruction at national scale: store in the good years.

Shula’s argument, set out in his 2023 paper and first published on Katondo Street, is that the economics travel even if the theology stays behind. A society that consumes its entire surplus in the good years has nothing between it and disaster when the rains fail. The biblical name for that surplus was the corners of the field. The modern names are reserves, buffers and insurance.

What the last El Niño cost Zambia

Zambia ran the experiment two seasons ago. The 2023/24 El Niño cut maize production by 53.6%, the lowest harvest in five years, to about 1.8 million tonnes by the FAO’s estimate. Of the 2,272,931 hectares planted with maize, 982,765 hectares, roughly 43%, were destroyed, according to the UN’s drought response appeal. On 29 February 2024 President Hakainde Hichilema declared the drought a national disaster and emergency. The Disaster Management and Mitigation Unit later counted 9.8 million people affected across 84 of Zambia’s 117 districts, with 6.6 million in need of assistance. Restocking required corn imports of roughly a million tonnes, by the US Department of Agriculture’s count.

Then came the rebound. Good rains in 2024/25 produced a record harvest of about 3.7 million tonnes and a surplus of 501,621 tonnes over national requirements, and the President directed the Food Reserve Agency to double its purchase target from 500,000 tonnes to a million. Reported agency purchases passed 1.2 million tonnes by the end of August 2025. The whiplash is the argument: the record year is precisely when a hunger reserve gets built, because the failure year is too late to start one.

The pieces already exist

Zambia already operates both halves of what Njala Insurance would join. On the financial side, the Farmer Input Support Programme bundles index insurance with seed and fertiliser, delivered by Pula Advisors with local underwriters including ZSIC General, Professional Insurance Corporation, Savenda and Madison. After the 2023/24 season that programme paid out more than K800 million to over 500,071 farmers, the largest crop insurance payout in the country’s history, distributed through mobile money against rainfall indices.

On the physical side, the Food Reserve Agency holds the strategic grain reserve. It is buying this marketing season at K347 for a 50-kilogram bag of Grade A non-GMO white maize, as we reported this week. But the FRA buys with public money, and the farmer’s role is seller. In Shula’s design the farmer becomes a contributor with a recorded entitlement: grain goes in at harvest, the ledger shows who owns what, and payout terms are fixed before any crisis, not negotiated during one.

The cash-premium problem is what the grain contribution solves. A smallholder’s income arrives once a year, at harvest. Asking for a cash premium before the planting season asks the household to fund insurance from its thinnest months. A contribution in kind, deducted at the moment of abundance, matches the farmer’s actual cash flow. It also answers a second constraint: in a drought year the kwacha payout has to buy grain from somewhere, which in 2024 meant imports. A physical reserve is denominated in the very good it exists to protect.

How a pilot would run

Shula’s own suggestion is to test rather than debate. A pilot could begin with a few cooperatives in drought-prone districts. Participation would be voluntary, the contribution perhaps 5% of the harvest, receipted digitally at accredited warehouses. The Zambia Meteorological Department’s rainfall data and satellite vegetation indices, the same evidence index insurers already use, would determine when a district has suffered a qualifying shock. Mobile money could top up grain payouts where households need cash rather than food, and the scheme could sit alongside existing index insurance: grain covers the food-supply risk, the policy covers income.

The pilot would measure what matters: participation rates, storage costs and losses, farmer satisfaction, effects on local food prices, and how fast support reaches households after a trigger. Storage discipline is a live problem even in good times; this month, farmers at three Mumbwa depots reported shortages of empty grain bags, as we reported. A distributed reserve lives or dies on warehouse records, independent monitoring of shrinkage and release rules written before the crisis. Shula’s warning is his own: the scheme must not become another programme where grain disappears into warehouses and politics decides who eats. Auditable ledgers, including blockchain records where they help, are useful. The institutional design is the innovation.

What it would mean for business, investors and policy

For insurers and brokers, a grain-denominated contribution creates a product that fits smallholder cash flow, bundleable with the weather-index lines already sold through FISP. Cooperatives become wholesale clients rather than distribution channels.

For agribusiness, accredited warehouses, agro-dealers and millers gain predictable throughput and a stabilised smallholder customer base that buys inputs more reliably after a shock.

For investors and the macro-economy, the 2024/25 import programme of roughly a million tonnes drained foreign exchange at a moment the kwacha could least afford it. A physical buffer built from farmers’ own contributions in surplus years is hedging that costs the treasury little cash, and it shortens the feedback loop that turns a failed harvest into an economy-wide shock through food prices, power generation and the budget.

For policy, government already funds FISP insurance and FRA purchases. A farmer-contributed reserve would stretch both budgets and fits the conversation now running through the Ninth National Development Plan and the 2027 Budget, which we have argued should be judged on productive investment rather than allocations. More on our agriculture coverage, including the El Niño preparedness warning we carried earlier this month.

The corners of the field

The instruction in Leviticus was never an insurance policy. Its economics has nonetheless survived every era’s renaming of it: reserves, buffers, contingency funds, risk management. Zambia grew a record maize crop in 2025 and may need every tonne of resilience it can assemble by March 2027. If the pilot works, the country gains a reserve its farmers own a share of. If it fails, the lesson costs a few cooperatives’ storage fees.

The question for the season ahead runs past how much Zambia can grow. It is how much of what it grows the country is prepared to keep. The cheapest answer to next year’s hunger may be sitting in the corners of this year’s fields, provided somebody records the deposit.

Sources

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Njala Insurance: The Case for Paying Zambia’s Drought Cover in Maize, Not Kwacha

Key takeaways

An old rule about field edges

What the last El Niño cost Zambia

The pieces already exist

How a pilot would run

What it would mean for business, investors and policy

The corners of the field

Sources

Work With The Zambian Economist

Njala Insurance: The Case for Paying Zambia’s Drought Cover in Maize, Not Kwacha

Key takeaways

An old rule about field edges

What the last El Niño cost Zambia

The pieces already exist

How a pilot would run

What it would mean for business, investors and policy

The corners of the field

Sources

Work With The Zambian Economist

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