Agricultural yield and commodity prices are very sensitive to weather patterns such as drought, excessive rain, or frost, which can cause major losses for practitioners in the agricultural value chain, including input providers, farmers, commodity traders, and food processors. This paper has a particular focus on the evolution of demand from the energy sector compared to the agricultural sector as a means of identifying the critical success factors needed for a prospering insurance market. It is concluded that recent growth in the weather risk transfer market is mainly related to speculative trading in the energy sector. Stakeholders in the agricultural sector around the world are growing increasingly interested in weather risk transfer products, but the lack of exchange-based instruments in this field, the relatively high basis risk between weather indexes and agricultural yield, the fact that agricultural markets are still highly regulated and inadequate information and training are all impeding the growth of this business.