A pleasantly surprising revelation came to me during the Agriculture Outlook Americas conference, which was held in rainy Boston this week.
The global agricultural community is comprised of big agribiz (think Cargill, Deere & ADM), family farms in Mato Grosso, bankers/hedge funds (many of which have no clue how things grow), and everything in between. As I do much of my work at the first link in the global supply chain, I attend numerous events like this each year. When working with such a diverse group, it is often difficult to achieve consensus on anything, and particular irreverence is often displayed towards new technologies. This is notable among the grower community, whose farms and farming techniques are often passed down through generations, just like an old watch or a wedding ring. But after going into this latest conference expecting the usual pessimism about cooperation, consensus formed around the need and application of new sources of data.
The innovations in agriculture that grab most headlines are usually related to technologies such as new seed varieties, super-combines, or physical infrastructure that increases efficiencies in drip irrigation. So, after one panel session comprised of investors looking for opportunities in both hemispheres of the Americas, I asked about the “non-tangible” innovations that often fly under the radar: those that require access to large databases, data manipulation creativity, and computational resources. The panel agreed that these are major focal points for the next generation of agricultural investments. Nearly every discussion that followed seemed to touch upon this theme.
The nice thing about quantifiable data for this community is that it can come from subjective sources as well as those repeatedly tested in a laboratory. A grower’s logbook for instance — containing such information as how a particular crop might respond to a specific weather pattern, the amount and type of pest-fighting application used in a given season, and local market offers — can all be assembled into an index, which is another quantifiable data stream that users may have at their disposal. And while upon first glance one might suppose that data streams are closely-guarded secrets, growers are probably among the most supportive advocates of open access and data sharing. What wiped out your neighbor’s crop a decade ago may be the very thing that hits you this year.
In several offline conversations during coffee breaks, I offered some insight based on projects that Weather Trends is pursuing. We’re working with clients to quantify relationships between weather patterns, crop disease, and agricultural yields. The potential for collaboration, and a new growth sector for this industry, was evident to everyone.
Looking ahead, I expect numerous high-quality and high-margin products to come to market that have their “roots” in both the acquisition of new types of agricultural data (ranging from genomic to planetary weather), as well as in repackaging existing data. As global food supplies are routinely subject to a number of shocks via weather, foreign exchange or geopolitics, this will be a very important platform for the global agricultural community in the years to come.
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