The wave of agtech has frequently been reported. Investor and entrepreneur visions for disruptive on-farm and transactional products and services are easily discovered. Not so commonly available, and in our view as the Illinois Soybean Association (ISA) checkoff program, one of the drags on successful agtech innovation is the under-representation of the producers’ voice.
This perspective is needed:
- To help the actual product development example: deliver insight, not just visual formalization of known information.
- To help the business model of value creation for producer.
- To help agtech get it right given the pace of innovation and crop cycle.
Our ISA producers lead the U.S. in bushels produced. If Illinois was a country, it would be the fourth largest soybean producer in the world. In 2018, there were 10.75 million Illinois acres planted to soybeans and 688 million bushels harvested.
Given our scale, there’s huge upside that can be realized from further development and integration of agtech. To capitalize, ISA is working to help facilitate the agtech ecosystem developing in IL that includes state, regional and national stakeholders.
The wave of agtech is frequently reported on, and from farm country, it’s clear that the convergence of rural broadband, cheaper cloud computing and ag IoT solutions are driving digital innovation on-farm in a way we’ve never seen.
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Federal, state and private resources are being devoted to build out systems for rural broadband delivery resulting in faster connections for producers. Sixty-one percent of rural households have high-speed access, and more farms are logging on daily. That’s key, as Big Data isn’t useful unless it’s really big.
Producers may have 20 years of field maps in their files but need the ability to efficiently move that data, push it and combine it with their weather data, for instance, for more insight. Even bigger, is pushing it to service providers that aggregate with field, yield, input and weather data from multiple acres in a given area to really provide insightful analytics that improve both their yields and agronomic practices.
Aggregation and analysis overcomes one of the common restraints for producers of new agtech, seeing new value created from the information. Producers will tell you, as an example, aerial imagery showing lower crop vigor over a gravel strip or higher crop vigor over a cattle yard removed 20 years ago is just the formal visualization of commonly held field knowledge – interesting to look at but won’t cause me to open my wallet.
And, IoT has been present on the farm for some time, but the ability to connect the various information sources is coalescing. The power in IoT is early warning and predictive modeling: Given limited tools and weather/time windows for interventions, simple “status” reporting has limited utility.
We are already seeing the benefit of “predictive” in connected equipment. John Deere loves sharing stories of knowing a part needs to be replaced and getting a service call out to the farm before it actually fails, resulting in more uptime to cover thousands of acres during limited planting, spraying and harvesting windows.
As ISA works to help reverse the underdigitization of row crop agriculture, we’re encouraging early consideration by investors and entrepreneurs of value capture for producers. This means bringing producers into the conversation near the beginning, and that value needs to be well defined.
Sustainability is a good example. It’s a focus of both the agtech and farming communities, and both groups recognize societal and economic values.
A recent survey of Illinois producers had 95 percent of the respondents saying sustainable farming practices were one of their responsibilities as farmers, and 100 percent of respondents recognizing that sustainable practices make them good stewards of the environment. Most producers will tell you they have an attachment to the land they farm and feel they have a responsibility to improve the productivity of the soil for those that will come after them, often family.
So, producers will tell you agtech applications that improve the soil or lessen the footprint of a farming operation have a personal, emotional value. They’ll also tell you in a commodity world of thin margins, management decisions need an economic underpinning.
There’s an ongoing, annual evaluation and decision making process by producers related to share of the crop input dollar. Data captured with remote sensors and precision technology, aggregated, can guide investments and maximize returns.
Swath control is an example of optimized inputs: GPS-enabled swath control which selectively turns off planting rows based on field geometry is an easy win: When it works, the saving in seed is a physical and financial reality measurable in real-time.
As are premiums for grain. The reality of better data capture and verification of process means Illinois soybean producers can “show their work.” There have been initial efforts by companies like Agrible (before its acquisition by Nutrien) and more recently Indigo related to data capture and offtake agreements, but we have yet to see a stability in those models with premiums producers can bank.
Pace of innovation
Progress on the values front is occurring as evidenced by the maturing of the investor approach to agtech. The prior, inflated “peak expectation” phase, where investors and entrepreneurs rolled out a beta product providing one new insight and expected widespread adoption, is over. There is a growing recognition that producers need to be brought in early to provide perspective and help create context that allows accurate product positioning in the market.
There’s also increased awareness that row crop agriculture in the Midwest, one crop cycle or maybe a double-crop situation, limits both the number of upgrades or versions of a technology that can be fielded in season, as well as opportunities for customer acquisition.
The innovation model of Farmers Business Network, launching multiple offerings, many of which do not tie to crop year, for instance health insurance, allows them to remain relevant in front of farmers outside of agronomic tools that can only be trialed one time per year.
As the year progresses, look for ISA to have a higher profile within industry events, including co-sponsoring the AgriTech Innovation Summit in San Francisco followed by a major commitment in July to bring AgTech Nexus to Chicago. We’ll have ISA producers in Chicago, one of the premier commercial hubs globally, along with a field day. We plan to really encourage engagement related to row crop innovation.
Our producers are optimistic that agtech moving forward will provide multiple solutions within a suite of technology to help growers capture a larger portion of the value of the soybeans they raise. To be successful, ISA needs to drive hard dollars to the producers bottom line in a commodity world.
**This post is sponsored by the Illinois Soybean Association as part of AgFunder’s Network Partner program.**