In 2006, there were 6.6 billion people in the world. Cut to 2050, and this global population figure will move beyond the 9.5 billion mark. A United Nations FAO (Food and Agriculture Organization) report predicted that the overall volume of food production worldwide will have to increase by nearly 70% in 2050 – in comparison with 2006 – to keep up with (read: feed) the rapidly swelling global population. The need of the hour is to consistently increase agricultural productivity levels – and the importance of ‘smart agriculture‘ comes into focus here.

Before moving on to the latest data, stats and insights from the domain of smart agriculture, a couple of terms need to be explained. Firstly, the concept of ‘big data farming’ refers to the utilization of big data to make more informed farming decisions – that, in turn, bolster production and profit figures. On the other hand, ‘precision agriculture’ is the technique of closely monitoring the variability in crop yields (within single fields and across multiple fields), and tackling such changes effectively. Both of these concepts are vital for understanding the essence of smart, information technology-driven farming. Let us now turn our attentions on some important smart agriculture trends and statistics to look out for in 2017 and beyond:

1. Size of the market

On a year-on-year basis, the global smart farming industry grew by nearly 6% in 2016, with it value going beyond the $10 billion mark. In the next ten years, the smart agriculture market is expected to witness a 4X growth (by the end of 2026, it will be a $40+ billion market). The hardware component of the industry will be at the forefront of this growth, with more than 50% share in the overall technological solutions for agriculture. The CAGR of smart agriculture for the 2016-2026 period has been estimated to hover around 11.5% – a mighty impressive stat in itself. The variable rate technology segment of smart agriculture will, in particular, grow rapidly.

2. Key drivers of the market

As mentioned above, ‘enhanced agricultural productivity’ is the main reason for the steady growth in demand for smart farming. A closer analysis of the market reveals several other factors that are contributing to the need for using technology in agriculture. Greenhouse farming practices have gone up significantly in recent years, food demand levels (and shortages) have been increasing, there is a definite need for smarter livestock management, and irrigation management (i.e., preventing wastage of water) has emerged as a critical issue. Individual farmers as well as corporate farming entities are increasingly looking out for solutions that can help them in producing top-quality crops, while minimizing costs and making optimal use of available technological resources. As such, adoption of smart farming practices is increasing across the world.

Note: As the global population is escalating (and the demand for food is increasing), the percentage of workforce employed in the primary sector (agricultural labourers) is going down. In this scenario, smart farming is the best possible way to improve, and maintain, productivity levels.

3. Growth of IoT in agriculture

Apart from productivity, ‘greater efficiency’ is the other main objective of smart agriculture. To attain these targets, IoT (internet of things) is quickly making its way in this sector. According to a recent BI Intelligence report, more than 75 million IoT devices will be installed (for agriculture) by the end of this decade – a rise of 150% from the 30 million figure in 2015. The average volume of big data generated and managed by individual farms will also show a staggering increase between 2017 (<0.5 million data points) and 2050 (>4.0 million data points). Consistent application of technology is resulting in more agricultural information being generated than ever before – and these insights are helping in bolstering productivity and efficiency.

Note: John Deere – a worldwide leader in agricultural machinery production – has already started to implement IoT sensors and other web-enabled tools in its tractors. Just like the fast-growing ‘connected cars’ market, ‘connected tractors’ are growing in popularity too.

4. Components of smart farming

The broad concept of ‘smart farming’ is made up of several, equally important technologies. Mobile applications can now be used by farmers to remotely track and manage yields, costs and other important farm metrics, sensing technologies (on-field sensors) have proved mighty useful, both hardware tools and software solutions have increased in popularity, and smart positioning technologies (GPS) have done their bit towards making agricultural practices smarter. The importance of communication technology – via the cellular platform – cannot be overemphasized either. Telematics (i.e., the transmission of information over long ranges) has been a key component of smart farming as well, as have been the advanced data analytics tools and platforms. Each of these technologies are evolving every quarter – and smart farming as a whole is becoming more advanced, as a result.

5. North America to remain the market leader

At the start of this year, North America – with a $5000 million smart agriculture market – was the clear worldwide leader in this sector. Between now and 2026, this market will grow at a CAGR of a shade under 10%, reaching $16 billion by the end of that year. In terms of actual pace of growth though, Asia Pacific markets (excluding Japan) will become the leader, with a CAGR of 13.7%. In Latin American countries, the CAGR of technology-aided agriculture will be more than 12% too. Europe, Middle East and Africa are also progressing rapidly in terms of growth in smart farming standards.

6. Smart water management

A Beecham Research report found that close to 70% of the total fresh water supply in world is used up by the agricultural sector. That, in turn, underlines the importance of optimizing irrigation management with technology, and cutting down on wastage of water resources. According to OnFarm, smart farming helped in reducing the total amount of water required (for irrigation) in a farm by as much as 8%. Technology has helped in bringing down per-acre energy costs by nearly $6 as well. There have also been gains in terms of fertilizer cost reduction. On average, yields have increased by nearly 2% due to smart farming – and this figure is expected to grow in a big way in the next 8-10 years or so.

Note: In the United States, the average cereal-per-hectare yield is 7340 kgs. That is close to double of the global average figure (3850 kgs).

7. Hardware components to lead smart farming

Between 2017 and 2022, there will be a surge in the usage of hardware tools and devices for smart agriculture across the world. In particular, VRT (variable rate technology) tools and GPS receivers will fuel the growth in this segment, while smart steering and guidance systems will also have hefty demands from farmers. The purpose of using advanced hardware on farmlands is easy enough: minimization of inputs/resources, upgradation of quality, and maximization of output. According to experts from the field of technology, the constant betterment in the standard of automation and control systems is playing a vital role in the growth of smart farming.

8. Rising investments

As interest in smart agriculture is growing and its benefits are becoming more and more apparent – investments in this sector are increasing too. In 2016, CropX (an American smart farming solution provider company) was invested upon by Lab IX and Robert Bosch Venture Capital GmbH. Many well-known OEMs of sensor devices are coming up with customized tracking tools and equipments – designed according to the precise nature, size and requirements of each farm. The collaboration between Trimble Navigation and Avidor High Tech France, Precision AG and Agrinetix (in November 2016) is an important example of the several high-profile partnerships that are being struck up between different companies involved in the overall smart agriculture value chain. Corporates are prepared to spend more on agricultural technology, knowing that the returns can be potentially big.

9. Drones are taking flight

On ‘connected farms’, drones (or, Unmanned Aerial Vehicles) are gaining in importance as useful tools for crop data generation and general surveillance of cultivation lands. Over the last couple of years, quite a few agricultural solution provider companies have included drones in their services – a clear indication of the latter’s popularity and utility in smart farming. Since drones are not particularly expensive and are (generally) easily manageable, they are finding ready acceptance as a key component of IoT-enabled farming tools. Capturing images from fields is the primary function of drones in agriculture. Since these tools have boosted both the volume and the accuracy of farming data, decision-making has also become more informed than before.

10. Understanding the smart agriculture ecosystems

Farmers and farm managers are, of course, the end-users of smart farming technologies. Technology providers are the ‘suppliers’ in this market – in charge of coming up with innovative software applications/mobile apps, M2M tools, sensors and tracking devices, communication channels, data analytics tools and other smart equipments for the users. OEMs like John Deere, who provide tractors and combines and sprayers are important stakeholders here, as are the ‘influencers’ (who have key decision-making authorities, including price-setting). With the advancement of technology, smart farming is becoming increasingly diversified – with players from different industries (retail, finance, chemicals, engineering etc.) joining the ecosystem in the last few quarters.

11. Fish farming on the fast track of growth

The benefits of smart agriculture has expanded to different types of firms. While indoor horticulture offers the best opportunities for precision agriculture, fish farming is another field that has started to show big benefits from the implementation of smart technology. Right from GPS tools to track the migration of fishes and selecting the best locations for fishing, tracking feeding patterns and detecting probable diseases – everything can now be done with the help of advanced tech devices/monitors/sensors. Information about the water quality can also be generated. Livestock management, farm vehicle management and dairy management are three other sectors that show high adoption rates of smart farming methods.

Note: Cotton, maize, soybeans and corn are some important crops that are being brought under the purview of smart farming in the United States. With greater use of technology and resultant productivity/supply improvements – it is expected that prices will remain under control in the long-run.

12. Barriers to growth

For all its advantages, smart agriculture is still at a nascent stage – with penetration levels on the lower side at present. A recent Trimble report showed that basic data services are used in only 1 out of every 4 farms in the world. In the US, less than 40% of the maize and corn acres actually employ precision farming techniques. The cost-factor remains an important barrier (setting up the required infrastructure requires significant upfront investment by farm-owners). The general uncertainties about data security in particular, and the impact of politics and weather elements on agriculture in general, are also important points of concern. Broadband and wifi network coverage in rural farm areas far from being uniformly strong, while there is still room for more specialized software solutions to come in. Confusions over the sensor standards, data ownership and cellular communication standards also lead to many farms staying away from initiating smart agricultural practices. Installations of IoT devices in farms also suffers from the problem of fragmentation. The good thing is, familiarity with IT tools and best practices is growing – and over time, most of these problems would hopefully be ironed out.

13. Growing opportunities

The scope of IoT is expanding rapidly, and the onus is on the farm owners to understand, access, and implement this ‘intelligence’ in their day-to-day farming practices (e.g., tractors or irrigation systems). The partnership between Dacom and Orange Business Services have shown that there are considerable opportunities for leading mobile network operators to collaborate with agri equipment manufacturers. Similarly, M2M platform owners can get into mutually beneficial deals with manufacturers of sensor devices (given the importance of embedded SIMs in sensors that would be used in rural areas). Both the hardware and software segments of the market are set to become more refined in the foreseeable future. All of these will contribute to, at the end of the day, greater productivity, sustainability, reliability and optimized farming.

Earlier this year, the ‘Internet of Food and Farm 2020’ (IoF2020) was launched to speed up the implementation of IoT standards and practices in farming, and push up the overall adoption of smart agriculture in Europe. The four-year project (2017-2020) has users from the arable farming, meat production, vegetables, fruits and dairy farming sectors, and as many as 19 use cases in total.

Usage of technology in agriculture is not something entirely new. The first gas tractors and chemical fertilizers were used way back in the 19th century, and satellites were used for farming from the later half of the 20th century. GPS sensors were included in tractors by John Deere in 2001. Technology has come a long way since then – web-enabled tools and services are becoming more and more commonplace, and interest in IoT is at an all-time high. With traditional farming methods likely to fall woefully short of meeting the escalating food demands, farmers are increasingly turning towards smart agriculture. This is one domain that is likely to soar further in future.

Original article was published here.