Agriculture is one of the most crucial industries for the economic growth of the world contributing 4% of the world's total GDP. Many developing and underdeveloped countries are dependent on the revenue that comes from agriculture and it can be accounted for more than 25% of their GDP (WorldBank.org, 2023).
According to the OECD.org, agricultural trade is growing rapidly and has increased by 7% annually between 2001-2019. Trade of agricultural products has not just been restricted to national boundaries since COVID-19 and going global. This generates the need for custom research in the agriculture industry to move towards smart transformation for growth and sustainability.
Smart Transformation of the Global Agriculture Industry
A report by OMR presented that is agriculture industry globally is moving towards smart agriculture and is forecasted to grow by a CAGR of 11.5% during 2022-28. The introduction of information technology (IT) in agriculture can help in precise farming and manufacturing of agricultural products. New-age technologies are supporting modern farming, supply chain and global trade of agricultural goods. With the help of smart agriculture world can enjoy many benefits such as:
Improving Precision in Farming
Smart agriculture is using technologies like GPS, drones, and satellite imaging for precise farming through which farmers can predict weather, environmental changes, crop status and soil condition.
• SK Networks, a company from South Korea invested $2M in a startup called Source.ag to set up AI farming.
• Smart Soil Technology has changed the face of precise farming by making predictions more accurate.
• ChrysaLabs, a leading innovator at the forefront of soil science, secures funding of $11 million to Increase Instant Access to Reliable and Low-Cost Soil Insights, Including Carbon Verification.
Improving Agricultural Supply Chain
The supply chain is one the biggest part to boost agriculture globally which requires the input of smart technology to upgrade the process of the supply chain in agriculture. Development such as the usage of Blockchain, IoT and AI to improve the supply chain for successful smart agriculture have been made.
• AgriDigital, an Australian block-chain-based agriculture supply chain management company raised $17.4 million for expansion and innovation in the agriculture supply chain.
• IBM Food Trust also launched its block-chain based, global food tracking network.
• AgriLeader, a UK-based firm launched a new block-chain program to support Haitian farmers and their sales.
Helping Environment Sustainability
The main of smart agriculture is to encourage environmental sustainability and many organizations and government is investing in smart agriculture to achieve so.
• United States Department of Agriculture (USDA) invested $2.8 billion to support climate-smart agriculture by partnering with 70 different businesses.
• At the G-20 summit, members stressed encouraging investment in smart agriculture to improve environmental sustainability.
What Future Beholds for Smart Agriculture?
Supporting Global Economy and Trade
Economies around the world are dependent on the growth and development of agriculture and smart agriculture makes it convenient and effective for the economy, trade and society.
• A report by the World Bank suggests that smart agriculture can help reduce poverty, increase income and food security by 80%.
• EU-US Trade Council emphasized promoting smart agriculture to reduce trade and economic challenges caused by COVID-19.
• USDA invested $178 million in International Food for Progress through 7 different projects for smart agriculture.
Collaboration of Big Technology Brands
Smart agriculture is the least explored market and has huge potential to grow in future which is why it is attracting many big brands to invest in smart agriculture.
• PepsiCo Announces $216 Million Investment in Long-term Partnerships with Three Major Farmer-facing Organizations namely Practical Farmers of Iowa (PFI), Soil and Water Outcomes Fund (SWOF), and the IL Corn Growers Association (ICGA) for agriculture transformation.
• A tractor-maker company named Deere invested in smart agriculture through space-based connectivity.
There are many investments made to encourage smart agriculture such as USDA invested over $70 million to support sustainable smart agriculture research and education in February 2023. To gain the most possible benefits of smart agriculture, it is important to understand its applicability in every agriculture market. Smart agriculture is just starting and holds huge opportunities for growth and development while supporting sustainability in future. It will require more investment for custom research to develop smart agriculture consult to educate farmers, companies and governments worldwide.