Four Views on the State of Digital Agriculture
This past summer, we conducted interviews with four different thought leaders in the realm of digital agriculture.
John Power is president of LSC International Incorporated, a Chicago-based consulting firm specializing in corporate and financial advice to participants in the global agri-food chain. He’s been a keynote speaker on digital agriculture at industry conferences in the US, Canada, and China.
Agricultural futurist Robert Saik is the Founder of The Agri-Trend® Group of Companies. He has published over 50 articles on crop agronomics and is a thought leader on the integration of technology in crop production. He has founded over 15 companies ranging from field diagnostic and sensory technology firms, fertilizer manufacturing, fertilizer distribution, agri-retail, agricultural consulting and farming including a purebred cattle operation.
Doug Hirsh is a professional investor specializing in farmland and agriculture technology. Doug has a long history in farmland fund management serving as a portfolio manager for a family office and accredited investors. His passion for farming led him to pursue a career in farming and real estate by launching the Dough Farms Opportunity Funds.
Brian Jones is the Chief Operating Officer of the Iowa Corn Growers Association (ICGA), the Iowa Corn Promotion Board (ICPB) and Iowa Corn Opportunities, LLC (ICO). He is responsible for identifying and qualifying new investment opportunities as well as managing all existing investments on behalf of the organization’s board of managers.
We asked each of these leaders the same questions. Here’s what they had to say.
If you were to give a state of agriculture speech today, what are the main points you’d make?
John Power: Clearly, we’re in a difficult situation with regard to commodity prices. It’s a challenging period – which would be the first point I would make.
Second, we’re also in the midst of a demographic change. The average age of a farmer in the U.S. is around 59. There are three times as many farmers over 65 as under 35 so we’re shifting gradually to a younger demographic in farming.
The other major element I’d discuss would be consolidation. Farm operations are getting larger and that trend will continue.
Rob Saik: Regardless of what food “religion” you believe in – whether you’re a vegan or paleo or organic or GMO or non-gmo or whatever denomination you come from – the one thing we all agree on is that agriculture must be sustainable and must be sustainable in the long term. It must be infinitely sustainable. Otherwise, the human race doesn’t exist.
“Agriculture must be sustainable, must be infinitely sustainable. Otherwise, the human race doesn’t exist.”
– Rob Saik
The agriculture must be able to adopt and utilize new sciences and technologies as they emerge.
Doug Hirsh: Farmers have a lot of anxiety, and I see it in the land market. There is much uncertainty about cash flow, so they’re not strong bidders on land. Personally, I’m trying to find ways to make our land more productive. That’s where technology is going to be a big play—today and in the future. New agricultural technology is going to make farmland more productive and put more money into farmers’ hands.
Brian Jones: I think the long-term demand prospects are good. The world does, in fact, need our agricultural products. But farmers must live to fight another day. They have to get from where we are today to where we might want to be in the future, where demand is a little stronger and markets a little more robust.
Digital technology has revolutionized the world outside the farm. How has it changed the world of the farmer?
BJ: From a technology adoption perspective, farmers always have been significant adopters of new technology. Going back as far as the Industrial Revolution, we’ve seen huge, very quick adoption of technology that added to the efficiencies of agriculture producers.
Despite all the challenges, farmers are resilient. They adopt new technology when it makes sense. I have no doubt they will continue to do that. I only pray they’ll have the staying power to stay in the game as new technologies come to the market.
And I have no doubt that we’ll deliver what the world needs in terms of food and fiber and fuel into the future.
DH: A company called FarmLogs is taking it to the next level. They’re working with grain elevators, getting grain sheets electronically for the farmers and helping farmers who are starting to sell their grain.
They have identified a place in the market where there’s really a huge need, and I think services like that will balloon in the next coming years.
Companies that offer farmers tools to empower them to market their grain earlier and get higher prices will make a big difference in farmers’ profitability.
Farmers are resilient. They adopt new technology when it makes sense. I only pray that they’ll have the staying power to stay in the game as new technologies come to the market.
– Brian Jones
RS: Field sensor technology. Whether it’s moisture sensors placed in the field, nutrient sensors placed in the field, leaf sensors to detect evapotranspiration rates – all of those things are interesting.
We need to know where the problems are in the field. So early stage detection of problems with high-resolution imagery is really important. If we had timely information, then that information could be used to help inform a farmer or an agronomist where there is a problem in the field.
How do you – in a very short time – scan all of those acres and determine which acres are actually being impacted by a nutrient deficiency, a biotic or an abiotic stress?
How would you – on a 30,000 or 15,000-acre farm – scout that land detailed enough and fast enough to provide actions in real-time? That’s one of the problems we’re starting to crack.
JP: The technologies that have been most widely adopted are auto-steer and yield monitors. A lot of precision agriculture-type activities are being adopted quite widely.
The newer-type technologies are around aerial imagery analytics and enterprise systems software for the total farm.
What obstacles must technology providers overcome to see wider adoption of their products in the agricultural community?
JP: For a new technology to gain traction, you have to be able to show you can increase yield or reduce costs. Obviously, cost is a is a crucial element – particularly in the current environment – because cost is something the farmer can control. So being able to show direct effects is highly important.
Another item I’ve emphasized is time because the farmer’s number one resource is time. Particularly during the season, there are tremendous demands on time. Anything that makes life more complicated and takes up time is not a very good idea.
And then the final point is quality of life. A farmer can put in a long day of work and not come home in the evening completely exhausted. Technologies like auto-steer have enabled that. Farmers who are – let’s say, “quite senior” – can still play an active role and help the operation because of technology. Auto-steer, in essence, is like spending a day at the office where the equipment is basically running itself.
DH: Many companies are trying to sell farmers service at three dollars an acre, five dollars an acre—farmers’ margins are razor-thin right now. As a land investor, my rent has gone down over the years and my taxes have gone up. These tight margins don’t leave much room for additional expenses.
On the technology company side, many new companies have a simple revenue problem—they give their product away for free, bundling their service with something like seed purchases. It’s part of their marketing tactics, but it’s hard to get someone to pay for something they previously received for free.
Many new companies have a simple revenue problem—they give their product away for free. It’s hard to get someone to pay for something they previously received for free.
– Doug Hirsh
BJ: Digitizing agriculture is one of the biggest opportunities, yet it’s also one of the biggest challenges we have. We are dealing with a biological system. Things change all the time and there are a lot of variables outside of our control.
The tools have to be good enough for the farmers to trust them. For example, if I were to get into an autonomous vehicle today, I have to trust programmers know what they’re doing and this car’s not going to get in an accident.
Farmers’ intuition is pretty good. They crunch a lot of things in their minds they probably can’t even articulate, and it all goes into that decision set.
It’s a daunting challenge to replicate the reality of the crop in the field over a life cycle. It’s a challenge to be valuable enough that farmers are going to be willing to put their life on the line and make decisions using those type of analytics, rather than the ones they know: driving by in their pickup truck, walking out into the field, inspecting plants themselves.
If software makes a recommendation that flies in the face of everything the farmer knows, it may be true. It may be good information. But if it doesn’t represent reality for them – as they know it – then farmers won’t trust it and it’s not going to be used.
Farmers have to be willing to turn some of that over to these more sophisticated analytical systems, but those systems have to be good—they have to be accurate and they have to be timely.
And these newer technologies are more complicated than what we’ve had to deal with before.
The challenge is to bring a robust system that both represents reality and also augments reality with good analytics the farmer can trust.
Which technologies have the best opportunity to help farmers right now?
BJ: I think technology companies generally over-promised and under-delivered. A lot of single-product companies are not viable as companies on their own. They’ve got to be part of a system that gets delivered in the right sales channels to the farmer through a trusted adviser.
I think ultimately that will win the day. That’s difficult; it’s not an easy thing. There’s no consistency of data, no sharing of data that allows this to readily happen. There’s not one “farmer portal” to put all your data into.
Farmers want all their advisers to share all their data, all in the same data format, so that when the next smart guy comes along and wants to look at data in a certain way, it is all available.
But the data is not like that yet. It’s disparate, disconnected. In many ways not standardized or formatted in such a way that the data flows freely yet.
Farmers’ intuition is pretty good. They crunch a lot of things in their minds they probably can’t even articulate.
– Brian Jones
So that’s a big challenge we have to get over. All this energy of what’s possible diminishes because we didn’t have enough sense to organize data in a way that delivers value.
JP: I see aerial imagery analytics as a powerful technology that – if used correctly – can give the farmer the kind of insight he needs to manage the operation in real-time extremely effectively.
Some years ago, there was a great deal of attention to drones. That has not really moved forward because of the difficulty of managing drones, dealing with the data you collect and the challenges around data collection.
Satellite is pretty common now, used extensively. But it’s got a resolution problem.
So we think the sweet spot is actually fixed-wing, aircraft-based imagery because you get the high resolution of drones and you get the timeliness of satellite which is what you need to drive analytical models. That’s essentially where the value is.
How can a technology company differentiate themselves?
DH: The companies that will do well will be the ones that can show the return on investment. It’s okay to spend $2/acre if that investment will make you eight. It’s marketing. You have to prove your product truly benefits the consumer. Anyone can say, “We can increase your revenue by X,” but people need proof.
RS: The keys to making this technology work for us are the rapid acquisition of data.
One could think about the deployment of airplanes with cameras on them. You could get large swaths of land frequently photographed. Then, you have to ingest that data. The computing power is increasing right now, so we’re able to ingest the data quickly.
I see aerial imagery analytics as a powerful technology that can give the farmer the kind of insight he needs to manage the operation in real-time.
– John Power
And then, utilizing technology that would provide for artificial intelligence. And there are lots of kinds of artificial intelligence. One that would do Anomaly Detection or Change Detection. Show us the degree of completeness of the rows – the seeding rows are – or even weed detection.
All of those things can be brought into a machine-learning type of algorithm. Ultimately, that can kick out an alert to a farmer saying, “Hey! Of the hundred fields you have, these four fields have an alert right now.” And, “These four fields have certain parts of the field that should be scouted out immediately.”
And will point you exactly to those areas where you should go walk.
JP: Well, this is really sort of focused on one particular thing. I’m thinking of retailers who are both a seller of inputs and a purchaser of commodities, of the grains and all seeds. They need to collaborate with these digital agricultural startup companies.
Then on the other side, startups desperately need access to the market and the distribution. This focus here is really around the collaboration between startups and established distributors.
BJ: Just from a go-to-market strategy, you can’t have all these small companies – with one-off products – knocking on the farmers’ doors. It’s got to be organized and delivered more seamlessly.
Farmers can only deal with so many trusted advisors. You’ve got to find your way onto the farm, in a systems-wide approach that’s still open.
Farmers don’t want to get locked into just one company’s system. So they are somewhat reticent to trust company XYZ just because they have the best platform today. They might have the best platform today, but what about tomorrow and next year?
This is the challenge of technology adoption in this geographically dispersed set of customers. There are relatively few large retail players and a bunch of small technology companies that are trying to penetrate it. It’s an interesting dynamic.
You are familiar with IntelinAir. Tell me your impression of work being done by IntelinAir and its technology.
BJ: It’s intriguing. I think it’s exciting. Their technology promises ways to drill down and understand exactly where things are happening or not happening, where infestations might be, where nutrient deficiencies might be.
Being able to see that in real time augments the normal decision making for a farmer. I think that is valuable – if it can be delivered in a timely fashion that fits into the normal decision set of a farmer.
DH: Their solution made sense to me. I’ve had experience with satellite technology, and understand its shortcomings. It’s too slow getting data to the farmer—they need near-real-time data so they can make real-time decisions. However, it’s not just getting them the data. They also have to understand what to do with it. What should I spray? Is there an insect infestation? Disease? If so, where? How much of the field is affected?
IntelinAir’s software analyzes high-resolution imagery to find problems in the field and presents the information to the farmer in a way that makes sense to them.
One of my top farmers is working directly with IntelinAir. The level of detail and insights they provide is remarkable. It truly helps them identify and address problems as they occur. IntelinAir keeps improving their algorithms to pinpoint and identify issues in the field, giving farmers the information they need to be more proactive.
My farm managers love to scout, and IntelinAir makes their scouting more efficient. They provide real value so farmers can address the problem as it’s happening. That saves money when, for example, they can spray an area vs. a blanket application, making it easier to grow a profitable crop.
…to facilitate those exact application zones and locations, a technology like IntelinAir’s AgMRI is absolutely critical.
– Robert Saik
JP: The technology is strong and the background of the founders also strong and experienced in technology. Another thing that impressed me about the approach IntelinAir took is to work directly with farmers, to understand the challenge farmers face and then bring the technology to solve the farmer’s problem, to provide a solution.
What’s interesting about IntelinAir’s approach is the data collection process is controlled by the company, and it doesn’t involve the farmer. It can be done remotely, so to speak. This is a crucial element because you’re controlling the collection process, you’re processing the data. You’re building a data set which – from inception – is of high quality. Ultimately, that will be exceedingly important.
RS: As we face a future where we want to make sure that inputs are applied when they’re needed, where they’re needed, at the time they’re needed, in the form they’re needed – which is basically the four R’s of nutrient stewardship – you think about, “how are we going to do that?” To facilitate those exact application zones and locations, a technology like IntelinAir’s AgMRI is absolutely critical.
And that makes us more sustainable. The applications are more specific. They’re more timely because the alerts are coming in time for the growing season.
One would have to look at a technology like that very quickly and determine it’s not a cost. It’s actually an investment—and that investment would yield greater crop yields combined with more specific and potentially lower inputs on a field basis.
These interviews were conducted in July & August of 2018.