Techgriculture

 

One of the oldest industries must embrace a digital, connectivity-fueled transformation in order to overcome increasing demand and several disruptive forces.

The agriculture industry has radically transformed over the past 50 years. Advances in machinery have expanded the scale, speed, and productivity of farm equipment, leading to more efficient cultivation of more land. Seed, irrigation, and fertilizers also have vastly improved, helping farmers increase yields. Now, agriculture is in the early days of yet another revolution, at the heart of which lie data and connectivity. Artificial intelligence, analytics, connected sensors, and other emerging technologies could further increase yields, improve the efficiency of water and other inputs, and build sustainability and resilience across crop cultivation and animal husbandry.

Demand for food is growing at the same time the supply side faces constraints in land and farming inputs

Connectivity’s potential for value creation By the end of the decade, enhanced connectivity in agriculture could add more than $500 billion to global gross domestic product, a critical productivity improvement of 7 to 9 percent for the industry.5 Much of that value, however, will require investments in connectivity that today are largely absent from agriculture. Other industries already use technologies like LPWAN, cloud computing, and cheaper, better sensors requiring minimal hardware, which can significantly reduce the necessary investment. We have analyzed five use cases— crop monitoring, livestock monitoring, building and equipment management, drone farming, and autonomous farming machinery—where enhanced connectivity is already in the early stages of being used and is most likely to deliver the higher yields, lower costs, and greater resilience and sustainability that the industry needs to thrive in the 21st century 

        Current IoT technologies running on 3G and 4G cellular networks are in many cases sufficient to enable simpler use cases, such as advanced monitoring of crops and livestock. In the past, however, the cost of hardware was high, so the business case for implementing IoT in farming did not hold up. Today, device and hardware costs are dropping rapidly, and several providers now offer solutions at a price we believe will deliver a return in the first year of investment. These simpler tools are not enough, though, to unlock all the potential value that connectivity holds for agriculture. To attain that, the industry must make full use of digital applications and analytics, which will require low latency, high bandwidth, high resiliency, and support for a density of devices offered by advanced and frontier connectivity technologies like LPWAN, 5G, and LEO satellites.

         The challenge the industry is facing is thus twofold: infrastructure must be developed to enable the use of connectivity in farming, and where connectivity already exists, strong business cases must be made in order for solutions to be adopted. The good news is that connectivity coverage is increasing almost everywhere. 

McKinsey Center for Advanced Connectivity and Agriculture Practice