The second farming revolution

27-01-2015 | Foresight | Oliver Girakhou

Foresight_01_2015

 

Using cutting-edge technology to maximize crop yields and minimize the use of resources
The world’s population is growing rapidly, and with it, so is demand for food. This means we need to convert more land into farmland or, preferably, make better use of existing farms. Over the past two decades, revolutionary high-tech information systems known as Precision Agriculture have been helping farmers to do just that: Maximize production while minimizing their use of resources.

Precision Agriculture is a huge technological leap forward from traditional farming methods. It uses GPS technology to help farmers measure important variables – such as crop yield, topography, and nitrogen levels – throughout the farming cycle and at every point on their land. This enables them to tailor the timing and quantity of inputs used on any given part of the field, ultimately resulting in more precise farming techniques, driving crop yields.

Such technology also offers major environmental benefits: It minimizes the use of fuel and chemicals, reducing CO2 emissions and soil and groundwater pollution. As a result, precision agriculture has become a key component of the shift towards more sustainable agriculture, which is rapidly gaining attention.

While the market for precision farming is still in its infancy, growing awareness of its benefits coupled with the demographic shift to younger, more technologically savvy farmers should continue to drive the industry. The US Precision Agriculture market is expected to quadruple from around USD 1.5 billion today to over USD 6 billion by 2022, equivalent to an annual growth rate of 17%. Outside the US, where the need for productivity improvements is even greater, growth is expected to exceed 20% per year.1

Precision Agriculture is opening up several opportunities for innovative companies. Firms such as John Deere, Trimble Navigation, and Yara have invested in systems that connect to tractors and enable farmers to understand their soil meter-by-meter. Other companies specializing in data analysis, farm management systems, sensors, and unmanned aerial systems or drone imaging could also represent attractive investments as Precision Agriculture grows further over the years to come.

1 http://www.trimble.com

oliver-girakhou-autor.jpgOliver Girakhou 
Equity Analyst RobecoSAM Sustainable Agribusiness Strategy

"The expected growth of the US precision agriculture market is expected to quadruple by 2022, resulting in a variety of attractive opportunities for investors."

 

 

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oliver-girakhou.jpgOliver Girakhou 
Equity Analyst RobecoSAM Sustainable Agribusiness Strategy

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