Processed data flows back into agricultural production

After data is collected & stored in real-time, it is analyzed with ML & AI techniques to optimize processes including seeding, ploughing, fertilizing and spraying.

• GPS sensors are installed on harvesting equipment to enable yield monitoring & mapping, allowing farmer to record crop yield by time & location.
• Advanced visual recognition systems enable accurate weed mapping, so variable spraying equipment can adjust the amount of product applied to the individual plant.
• The use of weeding robotics based on advanced computer vision is estimated to reduce pesticide usage by 90%.

A new generation of robots is coming

Agricultural robots, or agrobots are designed to help farmers performing difficult tasks such as planting seeds, crop harvesting, spraying, pruning, etc. While tractor guidance and auto-steer are already well utilized within farmers, progress in ad - vanced vision systems and cheaper IoT devices are fostering the development of driverless & fully-automated robots.

• From a central location, an operator can operate multiple machines in the field, making suggestions and relaying additional information.

Overcoming workforce scarcity

The next step are unmanned autonomous tractors, which allow to address the big challenge of skilled labor scarcity. Indeed farming is not considered an attractive em - ployment sector, and a decreasing number of young farmers are entering the industry.

• The average age of U.S. primary producers was 59.4 years in 2017 (from 58.3 in 2012). • Global demand for driverless tractors should exceed 46k units by 2028 (from ~11k in 2018).
• Production through transformation and preparation to consumer supply and consumption patterns.

A major market for drones

Agriculture is one of the biggest industrial applications for drones, which can be used to monitor field conditions, collect useful data, produce precise 3D maps, and even spray fertilizers and pesticides in precise spots of the field.

• Agriculture represented more than 25% of drone’s total addressable market in 2015.
• Drone-based areal spraying can be up to five times faster than traditional machinery spraying, while improving efficiency and reducing the amount of chemicals sprayed.

Big Data, AI and ML bringing it to the next level

Today, the real value lies in the application of artificial intelligence & machine learning to the datasets collected with agricultural IoT. Computer vision models are able to distinguish between crop and weed, while predictive analytic models are used to interpret data, track trends, and provide farmers with recommendation and decision support tools.

• Climate variations, diseases, as well as pests and weeds infestations are all challenges that can be alleviated by AI solutions.
• The global agriculture analytics market is expected to double from $585mn in 2018 to $1.2bn by 2023.

Data impact extends through the farmer’s business eco-system

Reliable and extensive datasets underpin real-time analysis and accurate predictions, which can be shared with third party stakeholders, like equipment makers, banks, insurances, and food producers, who also benefit from having access to such information.

• Banks and insurances can reduce administrative costs and better estimate risks, leading to improved pricing for their services.
• Food producers can anticipate crop yields and the ability to meet supply targets, and would be willing to pay a premium for reliable information like this.

Precision Agriculture – The Impact

Comparative benefits

Precision agriculture allows a farmer to better understand its field and produce in a more efficient way. Reduction of chemical use is beneficial both to the environment (less N2O emissions from soils) and farmers’ economics. Continuous monitoring of soil health minimizes the risk of nutrient depletion, nitrate leaching and groundwater contamination.

• Fertilizers are estimated to represent 30% to 50% of total farming costs.
• All in all, precision agriculture seeks to reduce inputs while increasing production output.

Challenges

Initial capital costs for the acquisition of technologies remain high. While precision agriculture might be economically profitable for large farms, the business case becomes more challenging for smaller farms. Additionally, advanced features such as predictive analytics might take time before being fully efficient as they often require several months of track record.

• Small farms are estimated to produce up to 70% of world’s total crops
• Cooperative based models for dataset-sharing and farm data-networks are likely to develop and service small- and mid-sized farms.

Market potential

Driven by the advent of key enabling technologies such as IoT, wireless communi - cation, advanced visions systems, and GPS positioning, the precision agriculture market is set to continue growing in the coming years, helping farmers to cope with labor shortage, productivity constraints and margin pressure.

• The precision agriculture market is expected to grow from $4.7bn in 2019 to $11.1bn by 2027 at a CAGR of 13%.

Vertical Farming – The Tech

Grow food better and with less space

Vertical farming is an innovative way of growing crops in the absence of soil, in a closed and highly controlled environment. Layers of crops are stacked vertically one above another, allowing an optimal use of the available surface.

• One acre of vertical farm can lead to the same output of ten to twenty traditional soil-based acres (depending on crop species).
• Year-round production is guaranteed and the proximity of production & consumption locations lowers dramatically the use of fossil fuels for delivery.

Hydroponics, Aeroponics, or Aquaponics

In a hydroponic system roots are submerged in an aqueous solution of macronutrients. In an aeroponic system plants are suspended in the air and nutrients transmitted through mist. Aquaponic solutions combine hydroponic techniques with aquaculture: in a closed-loop system, the water in which aquatic animals are raised is filtered and fed to the hydroponic system and then recycled back to the aquaculture.

• Hydroponic systems are today the most widely used, gathering more than half of global vertical farming revenues.

Controlling light, temperature, and water are key

In a controlled environment, temperature, humidity, water, and nutrients can all be controlled through customized software ensuring continuous optimal conditions. Lighting systems are essentials since they provide optimal photosynthetic wave - lengths to accelerate crop growth and maximize yield.

• The lighting component segment is estimated to represent 26% of vertical farming supplies’ market share.

Vertical Farming – The Impact

Comparative benefits

Vertical farming can increase crop yield by a factor of ten to twenty. Additionally, it removes uncertainties related to climate conditions, making it possible to grow a wider variety of crops at once. This tailor-made management of environmental fac - tors means that no herbicides, pesticides or fungicides are needed, and water usage is also reduced as it can be continuously recycled.

• It is estimated that vertical farming requires 95% to 99% less water compared to conventional field farming, and avoiding any agricultural run-off.

Challenges

High upfront investment cost as well as the intensive electricity needs for powering LEDs and maintaining constant control of the whole environment, take their toll on profitability. Also, vertical farms have to manually replicate processes freely per - formed in nature (such as photosynthesis or pollination). System’s over-dependency on technology represent another risks, where any power outage could cause signifi - cant damage to a vertical farm.

• Studies estimate the building costs of vertical farms to be up to 48 times higher than that of conventional greenhouses.

Market potential

Vertical farms are still at their infancy, and current economic profitability suggest that the technology is not yet ready for mass adoption. But even if vertical farms won’t yet replace large industrial farms they might find use cases in smaller instal - lations to grow crops for local community (vs. importing from far) or for high value crops such as saffron or medical cannabis

• The global vertical farming market is expected to grow at a CAGR of 24.6% from $2.2bn in 2018 to $12.8bn by 2026.

WaterTech – The Impact

Comparative benefits

Both smart & micro-irrigation technology have the potential to significantly reduce water usage by only supplying the right amount of water required. With water only provided to cultivated plants, negative side effects like weed growth (and the need for chemicals to treat them) or soil erosion are also reduced.

• Improper irrigation (over- or under-irrigation) is shown to create an environment favorable to disease, by over stressing crops.

Challenges

The relatively high initial investments required for deploying such technologies can be a challenge, especially in developing regions & for small farm owners. Furthermore optimal water supply through advanced water management technologies requires specific skills that might not be easily available.

• Drip or smart irrigation are both reliant on specific devices/tools that are both relatively costly and require skilled set-up and maintenance.

Market potential

Fresh water scarcity being a major challenge in many dry-regions. While India and China (together representing up to 40% of global irrigated land) have not much adopted micro-irrigation technology, some countries (e.g. Israel) have emerged as technology leaders in innovative irrigation systems.

• The global micro-irrigation market is expected to grow from $4.0bn in 2018 to $14.8bn by 2027 at a CAGR of 15.7%..
• The global agricultural wastewater treatment market is expected to grow from $2.09bn in 2018 to 2.73bn by 2023 at a CAGR of 5.48%

Players – List Of Relevant Pure* Players In The Industries