About how digital technologies penetrate into the agricultural industry in our country and what it will lead to in terms of economic efficiency, says Alexey Petunin, Deputy General Director of SAP CIS
“Digital” on farms and factories
In the early 2000s, large agricultural holdings began to appear in our country. In the mid-2010s, companies were able to invest in technology: soil, weather and plant health sensors appeared in the fields, and agronomists received applications that aggregated a wide range of data from the fields. According to the roadmap for the introduction of high technologies in agriculture of the Internet Initiatives Development Fund (IIDF), in 2019 a third of Russian farms will use the Internet of things and big data in their work.
For example, in crop production, big data allows you to monitor the condition of fields and tell farmers the best time for planting, watering, and fertilizing. And with the help of drones, you can see the condition of the soil and crops and thus determine whether there is enough water or fertilizer on the site.
From robots to platform, from farm to agricultural network
A 2017 McKinsey study found agriculture to be the fourth most automated industry among all sectors of the economy – the potential for automation in agriculture is higher than in construction, insurance and retail. The farm management software niche alone, according to AgFunder, could soon reach $1,6 billion. Therefore, technology companies and investors are actively investing in the agro-industrial complex.
Many startups offer technologies for the agro-industrial complex:
- the Swiss company EcoRobotix has developed a robot that weeds;
- engineering company Robert Bosch in Germany and startup Agrointelli in Denmark are working on robotic precision spraying systems.
Large companies also offer technological solutions for the market:
- John Deere has technology automation projects with a whole staff of programmers;
- Agco has autonomous Xavier robots for planting, tending and harvesting;
- Syngenta has a portfolio of startups that develop robots and software for agriculture.
However, numerous innovations in agribusiness are loosely linked, and this becomes a problem for both farmers and technology advancement.
Partial automation cannot completely solve the problem of farmers, since getting rid of labor in itself will reduce production costs by only 5-15%. It is necessary to create integrated systems in order to:
- support new business models and processes for individual market players;
- unite farmers, agricultural machinery manufacturers, fertilizer manufacturers, agronomists, logistics operators into a single network.
For example, as part of the Farm to Consumer initiative, blockchain is designed to help companies trace the entire supply chain of agricultural products and gain full access to the history of the origin of products.
The Dutch Waterwatch cooperative, in collaboration with SAP, has developed the Crop Disease Alert application, which monitors plant growth conditions. If any abnormalities are detected – temperature increase or heavy rains – the system sends a notification to the farmer about the risk of crop infection. The app also allows farmers to reduce the use of unnecessary pesticides by 15%. The Waterwatch cooperative expects that by the end of 2019, the application will be used by about 1 million farmers worldwide.
Working on a single digital platform allows large companies to reduce the cost of resources, and for small farms to get access to cheaper and better resources, as well as guaranteed sales of products.