Technology is a major input for increasing crop value

Rabobank reports added value through more efficiency and improved technique

Analysts at the multi-national ag lender Rabobank believe that “smart farming” practices stand to add some $10 billion per year to the value of field crops globally. However, the increase in output will require investments in both technology and the way farmers relate to suppliers and customers.

“Also known as smart farming, data-intensive farming utilizes new sensor technology to collect and process data for many variables relevant to monitoring and optimizing crop growth,” explained Rabobank analyst Harry Smit. “This allows farmers to tailor inputs and fine-tune application rates and cultivation activities down to the square meter. Over time, aggregation of data from many farmers will drive the development of even better agronomic decisions that can be customized and automated.”

According to analysts at the Global Harvest Initiative, productivity growth in the United States has slipped, from its historical average of 1.5 to 2 percent (1960 to 2000) to less than one percent (2001-2010). Like Rabobank predictions, GHI reports that raising global agricultural productivity requires long-term investments in the research and development of science-based agricultural technologies, agricultural extension services and education for farmers around the world.

It’s larger farms, though, that tend to have the capital and resources to adopt such technology. Think North America, developed parts of South America and Australia.
According to the Rabobank report, “Medium and small-sized farms will need to develop a means to access the required technology, and will face considerable competitive pressures to do so.

This will necessitate scaling up by either increasing their own operations or by becoming part of a bigger franchise, sharing data, technology and expertise. Options include developing relationships via their suppliers to leverage investments across farms, or through direct cooperation with other farmers.”

The report suggests that farming cooperatives have an opportunity and a responsibility to take the initiative in helping their members’ participate in data-intensive farming. “Cooperatives provide an obvious framework to help aggregate data and share costs and expertise. A cooperative database could also be used to develop new ancillary products, such as peer-to-peer analysis,” reported the authors.

To reach its estimate of $10 billion annual increase in global field crop value, Rabobank analysts figured an estimated 5 percent yield increase on 80 percent of the area for the top seven crops produced in the world (corn, soybeans, wheat, cotton, rapeseed, barley and sunflower). They noted that the real value increase could be higher considering “similar benefits to smaller high-value crops, such as sugarcane, potatoes, sugar beets, as well as fruits and vegetables.” The livestock industry is also expected to see similar benefits.

How might some of these technological advances look at the farm level?

Rabobank analysts suggest:

Drones: Increasingly used to monitor and boost livestock and crops, and measure pasture and grass growth. However, these are currently ‘work in progress’ due challenges such as real-time decision-making and systems reliability.

Big Data: Major retailers are using data to track purchases and monitor the quality of perishable goods, enabling them to meet consumer demand more effectively. At the same time, ag tech start-ups are developing ways to help farmers increase yields and cut costs, through weather information, analytics, soil monitoring and more.

Poultry production: Processors can monitor the performance of poultry farmers providing guidance on potential productivity and welfare gains. Growing control over poultry hatching, production and processing can boost productivity and profitability up to 5 percent.

Smart irrigation: GPS, plant and soil sensors providing real time data to spray systems to optimize the delivery of water and fertilizers.