Nearshore Americas

Digital Transformation in Agriculture May Seem Bananas, but Opportunities are Ripe for Plucking

With an increase in the global population, and the ascent of the middle class, the demand for the production of food has skyrocketed. But, while the business world embarks on its far-reaching mission of digital transformation, the agriculture sector still remains in the very early stages of next-gen technology adoption.

In Latin America, the industry has been encountering challenges in terms of a dearth of technology that supports increased productivity and reduced labor dependency. These challenges are being addressed by integrating farming with technologies that provide decision support systems, effective farm monitoring, crop management, improved farm household income, farm output, and an overall improvement in the efficiency of the agricultural system.

Even so, while the use of technology in the production process is still nascent, its use in marketing is spreading much faster, allowing companies of all sizes to reach their customers in new ways, and creating new customer experiences that help them differentiate in a vertical that is prone to commoditization.

Internet of Fruits?

One good example of a company that is trying to differentiate in the industry is Dole. The company known globally for its bananas is putting a simple sticker on its products. This sticker has a code and an invitation to visit its website. If a client does that, they will find information about which farm that specific banana came from, a complete “banana journey” from farm to supermarket), and also videos and a 360 degree tour of a banana farm.

Nothing disruptive, but, maybe it is, if you think that bananas are one of the more commoditized fruits.

The story of Avocados from Mexico is similar, but different at the same time. The association groups a lot of small producers that export avocados from Mexico to the US (some 80% of the avocados consumed in the US come from there).

Avocados from Mexico has gone way beyond the informative website. They have experimented with image recognition, mobile communications, and even artificial intelligence for marketing actions. With a small marketing budget, they leverage technology to make an impact.

Enabling Technology to Impact Production 

On the production side, there is still a need to develop precision agriculture enabling technologies that would improve productivity without having an impact on the environment.

Our recent analysis on the topic has shown that the key enabling technologies include wireless sensor networks, global navigation satellite systems (GNSS), cloud computing, machine-to-machine (M2M) communication, artificial intelligence, big data, predictive analytics, robotics, and drones.

Some of the more recent connected agriculture technologies in the developed or developing stages are farming apps. These can support data provision for on-field activities for farmers to make more informed decisions. There are also roof-top farming technologies in land-scarce regions, and monitoring systems that record information that is then accessed through the Cloud.

Wireless communication infrastructure and service providers, as well as data management and analytics hardware/software providers are leading the smart agriculture innovation ecosystem, presenting a good opportunity for more to follow.

Awareness, Education, and Upskilling

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There are still many barriers to widespread technology adoption in agriculture. Connected agriculture involves the application of advanced technologies, which is difficult for farmers to understand and apply the solutions in their farms.

Though the solutions are automated, setting up of the desired output is also a challenge that threatens farmers. Low awareness on the analysis of large data sets also hinders adoption, and the lack of common protocols or standards slows the pace of development.

Ultimately, the critical success factors for connected agriculture solutions providers include enabling continuous monitoring, empowering real-time data collection, increasing automation of crop cultivation and livestock production systems, and demonstrating increased farmer Return Of Investment.

No, we’re not going bananas. ROI continues to be king.

Ignacio Perrone

Ignacio Perrone is the Research Director of LATAM Information and Communication Technologies at Frost & Sullivan. He is in charge of syndicated research, custom consulting projects and business development in the Information and Communications Technologies space.

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