By Daniel St George
October 21st, 2019
Burlington has a large rural area that makes up close to half of the city’s geographic area – much of it is excellent land that could support profitable and sustainable agriculture. Much of it is owned by developers who rent it out on terms that are not all that xx for farming.
Despite those limitations there are a number of very productive farms that can make use of some of the innovative technologies to make farming better, smarter, and more efficient.
When used in the right way, it can also help drive transformational change across the food value chain to address the most challenging agriculture and food problems facing our planet. At least that is the promise from most of today’s ag-tech companies.
The biggest risk is that this promise, is just that, a promise. Technology today is not moving the needle far enough to meet farmers expectations and address the biggest challenges our planet is facing now and in the future. Challenges such as climate change, population growth and changing consumer demands.
Innovation in agriculture has helped farmers and growers throughout time, from horse-drawn tilling machines to automated tractors. The rate of this innovation over the last 10-20 years has exploded, and the number of agribusiness start-ups has followed suit.
Globally, investments in the agribusiness and food sectors have tripled since 2004. Agriculture technology has become a global phenomenon, with start-ups growing by over 80 percent each year since 2012.
In Canada, farm income has risen each year since 2003, except for a brief downturn in 2018. In a recent study by RBC in Canada, the study found that the sector could contribute up to $51 billion to the economy by 2030, through boosting technology investments, building new skills and addressing labor shortages.
The real question is not necessarily how we can get more and better technologies into the hands of farmers. Instead we should ask ourselves how we can better aggregate these technologies across farms at scale, combine disparate data sets and drive insights to improve key metrics such as yield, and to improve crop planning and variety, including growing conditions such as soil quality.
However, Innovation is also a double edged sword
Every day farmers are bombarded by offers of new technological advances and innovative solutions. These include everything from farm management systems to soil sensors and innovative farm machinery.
This ongoing innovation is increasing the complexity of purchasing decisions and farmers are often wondering whether the value is really there. Not to mention, many of these technologies are often too expensive, especially for farmers who own small to medium sized farms. In addition, many farmers find they do not get the full value from these technologies as they often only utilize a small portion of the functionality that the solution is capable of.
For example, in a recent research paper in the journal for Agriculture Systems, it mentions that data collected by farm technologies is heavily under-utilized, and there are significant challenges with data quality and availability, as well as a lack of integration between technologies.
A recent comment by a farmer who uses an automated self-drive tractor says, “It hasn’t really improved productivity on the farm, and it hasn’t allowed me to relax because I still have to keep an eye on it. It’s a lot harder than we think to apply technology to farming in a way that truly helps farmers. That’s the challenge.”
Large companies are squeezing margins and farmers are feeling the pinch. The food value chain has become a fragmented set of silos with different players all wanting a piece of the pie. And farmers are the ones who are suffering. Without an economically sustainable farm, many of the global challenges we face today will never be addressed.
How do we then overcome this problem? How can we utilize technology to move the needle further and do farmers bear responsibility for driving this change? What role do other organizations play such as cooperatives, food manufacturers, governments and trading companies?
Innovation paired with foresight can yield world-changing results
The world faces a challenge in providing enough food to feed its growing population. The current rate of agricultural productivity is not sufficient to feed a predicted population of 9.1 billion people by 2050.
To solve this and other future challenges, agriculture needs orchestrated innovation. When used in the right areas and for the right purposes, innovation can move the needle significantly to address these fundamental macro-challenges.
Traditionally, the food value chain has resembled a relatively linear model, from research (e.g. seed and varieties) and production to harvest, process, packaging, distribution, and sales. The value chain is made of companies who play specific parts within the system but often not across its entirety.
Often, these companies don’t share information and compartmentalize expertise and knowledge along the value chain. This lack of collaboration limits their insight.
When innovators’ focus narrows, the technology they invent might end up hurting farmers and consumers or only help a select few, rather than helping achieve a greater good. Innovative foresight to leverage technology and apply it in the right areas to drive value is critically important.
A three-pronged road to innovation grounded in data, collaboration, and sustainability
How can agricultural innovation ensure that new technology minimizes the risks and maximizes the benefits?
The answer lies in three fundamental areas:
1. Connecting disparate data sets across the value chain to drive greater insights—such as digital farming platforms.
2. Creating ecosystems of organizational partners to share data and best practices and to work together on uncovering exponential rates of productivity and farming yield using ecosystem-driven business models.
3. Designing business models that drive value back into the farm, while at the same time being sustainable and economically viable—with a focus on farmers and growers.
Who can address the macro-challenges we face globally and what are digital farming platforms?
What types of ecosystems do we need and how can we develop a more vertical-integrated value chain.
And who is going to get it all started?
Daniel St. George is a Senior Managing Consultant, Digital Strategy in the Agribusiness Sector.