Ag Tech: On the Cusp of Something Big?
The investment and ag-tech sectors’ continuing courtship of agriculture, smoldering for three or four years now, was well in evidence at the recent World Agri-Tech Innovation Summit in San Francisco, CA. Attendance exceeded 500, highest for the event according to conference organizers.
But efforts so far to fully cement the “tech” into “ag” have been frustrating on both sides. The tech sector features digitally infused innovation aplenty – sensors, artificial intelligence, Internet of Things (IoT) connectivity, robotics, and more – but openly questions when ag will fully buy in. Agriculture, meanwhile, generally awaits demonstration of tech’s full on-farm value – real-world trialing of new technologies and a rundown of the concrete ways in which they will help farmers do their jobs better. A from-the-podium poll of attendees who thought there was another ag-tech “unicorn” out there on a par with Monsanto’s $930 million acquisition of The Climate Corp. brought a smattering of raised hands.
And yet, there was widespread agreement that ag tech is about to turn a corner. Sure, agriculture often is slow to change. U.S. farmer and keynote speaker Kip Tom noted that the tractor was introduced to American farming in 1920 but did not surpass use of horses in the mules in the field until 1955.
But continuing breakthroughs in Silicon Valley and elsewhere, the increasing affordability of many digital technologies, a generational turnover from Baby Boomers to Generation X and Millennials, and the much-discussed need to feed a growing world population all point to an increase in the use of precision agriculture and digital farming technologies.
Making It in the Real World
Appropriately, Blue River Technologies of Silicon Valley surpassed 13 other tech start-ups to win attendees’ vote for the event’s Disruptive Innovation Award. The company’s See & Spray technology uses image recognition, machine learning, and artificial intelligence to address a real problem for growers in the southern U.S.: herbicide resistance in pigweed. The machine literally sees and sprays only weeds, and leaves crops alone.
In an industry beset by chronic labor shortages and a perpetual drive to “hear” what a crop wants in order to improve its performance, interest was particularly acute for robotization and sensors as well as for the IoT backbone needed to run digital ag. Verizon was in attendance at the event, having identified agriculture as one of five strategic growth areas for its IoT business.
But innovation, it was well noted by event attendees, ranges far beyond nearby Silicon Valley and the rich fruit and vegetable regions within only a few hours’ drive from the Bay Area. Technology tends to go where venture capital money and a density of farmers – if not necessarily the greatest agronomic needs – are located, noted Damien Lepoutre of Geosys. This means England, France, and other well developed areas of the world as well as California.
Latin America too. The region, home to a quarter of the world’s arable land and a net trade in food exports of U.S. $150 billion, currently lags the U.S. and Europe in ag-tech investments. But the region is beginning to catch up thanks to “patient capital,” said Yuri Soares of the Multilateral Investment Fund. With more open, democratic, and pro-market societies, “this is a completely different region today” than it was even a decade ago, he said.
Latin America in just the past several years has seen its first examples of venture capital and tech incubators and accelerators, and now Brazil, Mexico, Argentina, and Colombia – in that order – have passed meaningful thresholds in scorecards that measure VC interest. For many developing countries hard-pressed to reduce costs, “technology is critical,” said Federico Trucco of Bioceres. In Latin America “you will see some of the highest adoption rates in some of the disruptive technologies,” he said.