Digital Transformation: Impact On The Global Agriculture Industry
POWER OF AGRITECH
Agricultural technology has developed significantly over the past few years, and continues to develop rapidly. However, the level of adoption of technology across the industry is mixed, and this often comes down to three key areas: cost, complexity and capabilities. The potential for AgriTech to disrupt can vary across the value chain – in many instances supplementing or complimenting existing products/solutions, and in others replacing them entirely. This disruption can bring about positive changes in agricultural productivity and efficiency, as well as cause a ripple effect: forcing behavioural change that ultimately leads to changes in the traditional operating models and ways of working.
In an industry where margins are extremely pressured, every efficiency gain and increase in productivity can deliver value.
CAN TECHNOLOGY HELP REDUCE WASTE?
Globally we produce enough food to feed the entire population of our planet. However, as an industry, agriculture faces a big challenge with waste. Recent reports from UN suggest that annually 30-40% of the food produced globally is wasted – and this includes everything from food spoiling in warehouses, through to consumers throwing out unused food.
Digital transformation has a key role to play in the food processing ecosystem. Better use of technology will alter the way businesses work and the way producers use information and data to maximise production value. The ecosystem is complex with many transfer points throughout the process – from raw materials, processing and quality tests, through to distribution. At each of these transfer points there is an opportunity to increase efficiency and reduce waste. Introducing better technology and leveraging IoT will ensure that these ‘leaks’ in the ecosystem can be identified and these gaps closed before, or as, they occur. Now, IoT is not just a sensor, it’s a combination of hardware, software, platforms and applications that are set up for specific purposes. These can be seen across the entire chain from logistics through to our purchases. All of this has an impact on decisions around what to grow, what to produce and what to sell.
When looking at how to tackle this challenge, there are many possible options of where to start. But the first movers that can make an impact in food wastage really starts at the farm.
In order for farms to enhance and optimise resource farmers need to look to technology to improve productivity and efficiency.
PRECISION AGRICULTURE TECHNOLOGIES
In line with evolving consumer behaviour, there is now a growing demand for clean and organic food, but this is much more intensive and time consuming for farms to produce. Yet the demand exists and seems very likely to continue to grow. To meet this demand, farms must look to technology solutions and integrate these into their operations if the demand is to be met in a price driven market.
Farms need to ensure their resources are being optimised in order to ensure their yields are maximised.
This is one area where there is a growing need for precision agriculture – using technology to improve the ratio between agricultural input (such as water, fertilizer, land, etc.) and agricultural output (food). Using technology such as geo-mapping and remote sensing, farms can ensure key products are being optimised and maximised, ultimately impacting and reducing the wastage across the supply chain.
Whilst the adoption rate of technology in the sector is increasing, we have to acknowledge that many farms and agri-businesses may not have the knowledge and technical background to be able to use and adopt these technologies immediately – a key barrier to adoption in the industry today. However, the demand for the technology is there, and businesses see the value in the technologies available. This is where businesses can and should turn to third-party providers who are experts in the use and installation, and the monitoring of these systems for support to implement and make best use of the technology available.
If the industry is going to improve productivity, reduce waste, and be able to continue to meet global demands, agri-businesses need support in order to accelerate the use and adoption of technology.
LOOKING TO THE FUTURE
There are many different applications for technology in agriculture, and there are some key growth opportunities that businesses should look to grasp now:
- Big data analytics – building diverse and big data sets
- Rapid detection methods
- Advanced food safety software – interfacing with tracking and traceability
- Emerging technology innovations – automation and robotics
But it takes time to take advantage of the growing technological opportunities. Before they can really feel the benefits, agri-businesses looking to adopt new technologies will have to stagger these changes: starting with getting the hardware in place before improving networking and introduction software applications.
If the benefits are to truly be reaped across the industry, technology needs to be adopted from the farmer all the way through to the retailer. With global demand continuing to increase, it has never been more vital for businesses across the value chain to consider tackling these challenges and changes now.