Netherlands And Denmark Most Vulnerable To Adverse Weather, Reports New Study By ABN AMRO

ABN AMRO has launched study to quantify the extent to which adverse weather conditions affect industry production in Western Europe, Scandinavia and North America. The study, produced in association with Reactions, the global insurance market magazine, will appear in the

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ABN AMRO has launched study to quantify the extent to which adverse weather conditions affect industry production in Western Europe, Scandinavia and North America.

The study, produced in association with Reactions, the global insurance market magazine, will appear in the form of a weather map in the June edition of Euromoney magazine.

Using data from 1980-2003 collected from various government agencies, the study has identified those countries whose industries are most at risk from production loss as a result of adverse weather.

Sectors included in the study are agriculture; transport; construction; food and beverages; mining; wood products; textile products; petroleum and coal products; wholesale and retail trade; real estate; healthcare and social assistance; accommodation and food services; state and local government; electric energy; and gas.

“This study shows the vast amount of industry that is vulnerable to adverse weather conditions and the extent to which production can suffer. Industry needs to ensure profits are protected by hedging against weather risk,” said Alex Schippers, Global Head of Weather and Insurance Derivatives at ABN AMRO.

In Europe, industry in the Netherlands and Denmark is at greatest risk, with more than 30% of all production susceptible to loss as a result of adverse weather. Other high-risk countries, where 25-30% of production remains vulnerable to adverse weather, include the UK, Spain, Italy, Sweden and Norway.

Windstorms and floods cost Western Europe and Scandinavia EUR 2.8 billion from 1980-2003, with France being hit by EUR 500 million in damages from windstorms alone.

In North America, industry in large sections of the United States retain the highest levels of exposure to adverse weather, with 25-30% of production in the central US, Southern States and the east coast as far north as Virginia, at risk.

Natural hazards cost North America EUR 5.9 billion from 1980-2003, with the southeast region of the United States being affected most, with approximately EUR 1.73 billion worth of damage caused by windstorms.

The weather derivatives market continues to grow and was worth USD 4.57 billion at the close of 2004, according to a survey conducted by PriceWaterhouseCoopers for the Weather Risk Management Association.

ABN AMRO is a leading provider of weather risk management products and services, including over-the-counter weather derivatives, with operations in the UK, Europe and Asia.

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