Digital Transformation in Agriculture

The world is continually changing. Post-COVID, we are seeing these changes becoming more profound. Further, the need is for a more serious approach to one of the biggest challenges faced by humanity in the form of the Climate Crisis.?It is imperative for us to look for a reset of the way we conduct ourselves.

One of the fundamental drivers for these changes is digitization or the digital economy. The digital economy is the economic activity that results from everyday online connections among people, organizations, and devices with data, and processes at its center. The backbone of the digital economy is hyper-connectivity which is catalyzed by the growing interconnectedness of people, organizations, and machines that results from the Internet, mobile technology, and the evolving new business and operational models.

At the core of the digital economy is the digital transformation which in simple terms is using the latest technology to do what we already do – but better. Digital transformation can be defined as the adoption of digital technology to transform services or businesses. This is achieved by replacing manual (non-digital) processes with digital ones or replacing outdated digital technology with upgraded digital technology.

As we see going forward two key factors for the growth of the digital economy are the ease of connectivity and the multidimensional use of data, both are transforming business models, facilitating new products and services, creating new processes, generating more value, and is leading to a new culture of management.

Impact of Digital Economy on Agriculture

Digital technologies including the Internet, mobile technologies, sensors, remote sensing, drones, data analytics, artificial intelligence, and blockchain, are changing agriculture and the food system across the globe. Digital transformation is impacting agriculture at different stages of the agri-food value chain for example farm machinery automation allows fine-tuning of inputs and reduces demand for manual labor, remote satellite/drone data, and sensors on the field improve the accuracy and reduce the cost of monitoring crop growth and quality of land or water while traceability technologies, blockchain and digital logistics services offer the potential to streamline food supply chains and create trust amongst the supply chain participants and consumers.

Digital transformation also helps governments fine-tune and improve the efficiency and effectiveness of existing policies and programs, and to design new policies which are more relevant and pragmatic. For instance, freely available and high-quality satellite imagery dramatically reduces the cost of monitoring many agricultural activities. This could allow governments to move towards more targeted policies which incentivize farmers based on observed outcomes. Further, digital technologies enable the automation of processes for agriculture and the development of expanded government services, such as extension and advisory services.

Finally, digital technologies can support trade in agriculture and food products, by creating market linkages between producers/suppliers and new markets, and enabling new ways for governments to monitor and ensure compliance with standards and to provide faster and more efficient procedures that are essential, especially for perishable products.

Challenges of Adoption

The need is for accelerating the urgency for digital transformation to achieve agility, adaptability, and sustainability. Industry structures and business models need to be disrupted and the digitalization of the economy must rapidly accelerate. An estimated 70% of new value created in the economy over the next decade will be based on digitally enabled platform business models. However, 47% of the world’s population remains unconnected to the Internet.

Some of the key challenges in scaling up of digital economy include but are not limited to the adoption of new technologies, the emergence of new business models, agility in the creation of a supportive policy environment, global cooperation in sharing of success and failures, and last but not least availability of skilled resources.

As we see new technologies including quantum computing, 5G/6G telecommunication technology, cloud computing, artificial intelligence, and machine learning all acting as positive green shoots, however, their uneven adoption is creating a digital divide which is going to be a big hurdle.?

While we have seen the emergence of new business models in both public and private sectors yet the biggest roadblock is these models are still in early stages and while we have shortened the transformation curve yet it is too slow and can be a speed-bump.

On the policy front, we again see governments and regulators, because of their lack of understanding of modern technologies and models, confused. Policy regimes must catch up with the pace of innovations.

Better cooperation and collaboration globally in the digital economy is the need of the hour yet we still see that not happening as much as it is desired. We see few organizations trying to become the pivot but we need more decentralized models of collaboration emerging including a healthy mix of public and private organizations.

Last but not least the severe shortage of appropriately skilled manpower is the biggest threat to the scaling of the digital economy.

Emerging Technologies for Digital Transformation

Digital technological advances and transformation can support the goal of achieving more resilient, productive, and sustainable agriculture and food systems, that better meet consumer needs. Artificial Intelligence and Machine Learning based platforms can vastly help the farmers to make better decisions about the activities being done by them during cultivation. Collected ground-level real-time data can be used with these technology algorithms to provide farmers with the data insights about what to do when to do and how to do it in the form of recommendations. Geo-informatics can enable traceability as well as easy to understand data visualization for all stakeholders like agriculture input/output companies, Government, development agencies, and extension service providers. Further modern digital technologies like deep learning, image processing, and artificial neural networks can be used to detect pests’ infestation, crop stress, and nutritional deficiency for real-time intervention. Using transparent enabling technologies like Blockchain, cloud computing and cryptography can ensure both the agriculture input value chain as well agriculture output value chain can be made efficient, corruption free, and easy to regulate.

We are living in a time when economic paradigms are shifting. Exciting technological innovations are driving transformative change. While there are many technologies that are reshaping products and markets and are profoundly altering the way businesses and individuals are engaged with each other, a few key ones are listed below.

• Artificial Intelligence/Machine Learning/Deep Learning: These are a collection of technologies that can be used to solve problems autonomously and perform tasks to achieve defined objectives without explicit guidance from a human being.
• Internet of Things: It is a network of physical objects that are able to connect to the Internet and seamlessly share data with each other and the central analytical brain on the cloud. These are a collection of technologies in the field of sensor, connectivity, security, and communication protocols.
• Big Data Analytics: As we produce petabytes of data today it is a challenge to analyze them to create meaningful insights. Big data analytics technologies are able to process and analyze the high volume, high velocity, and hugely diverse raw datasets using specialized computers and software.
• Blockchain: In short it is a software solution comprising of algorithms that allows data to be verified and stored in a distributed network, thereby reducing single points of failure, mitigating fraud, and enabling the automated execution of agreements via smart contracts. Blockchain is distributed ledger technology that has converged cryptography and distributed computing to create use cases in nearly every domain. Most of the cryptocurrencies including Bitcoin are run on Blockchain infrastructure.
• Quantum Computing: Quantum computing is a type of computation that harnesses the collective properties of quantum states, such as superposition, interference, and entanglement, to perform calculations. In short, it is storing and processing information by manipulating the behavior of individual atoms, ions, electrons, or photons. Quantum computing has the potential to provide computational power on a scale that traditional computers cannot ever match.
• 5th and 6th Generation Wireless Technologies: Although it is still early days for 5G wireless technology, top industry players are already busy working on its successor, the 6G Wireless Technology. 5G promises download speeds many times faster than incumbent 4G networks and significantly lower latency times, 6G is set to raise the bar even higher, with speeds estimated at 100x faster than 5G and upped bandwidth to keep consumers more connected than ever before. While 4G gives speeds up to 50 Mbps and latency between 50 milliseconds to 100 milliseconds, 5G gives speeds up to 10 Gbps and latency between 1 millisecond to 10 milliseconds, and 6G is expected to give speeds up to 1 Tbps and latency of 1 microsecond.

About Author

DEEPAK PAREEK, CEO, AgriWatch, Technology Pioneer & Expert – Digital Transformation, World Economic Forum??

Deepak is CEO of AgriWatch a consulting firm that provides market intelligence, research, and advisory services across the agribusiness value chain. AgriWatch is bridging the information and insight gap that exists in various sub-sectors of the agricultural economy in general and agricultural commodities trade in particular through access to lakhs of farmers and thousands of traders. Deepak has 22 years of diverse experience working across 34 countries on various projects.