In order to improve productivity, farmers are now increasingly looking at using Big Data collection and analysis and moving towards Precision Agriculture.
Seeds-to-chemicals giant Monsanto has just announced its acquisition of Climate Corp,a weather insurance underwriter, for just under a billion dollars. This comes at a time when the number of tech startups working at the junction point of the Internet of Things, Big Data analytics and agriculture is growing fast. This trend is in line with changes that this age-old industry is undergoing in developed countries, where new local consumption patterns are emerging and a new generation of farmers is increasingly making use of connected devices to improve crop yields. As the cost of connected sensors that gather data on weather, soil status, pollination and so on comes down, systems for analyzing and forecasting uncertainty factors likely to affect crop yields are coming within reach of all types of farmers, fostering the emergence of what is being termed Precision Agriculture.
Freeing farmers from the constraints of uncertain weather
The Internet of Things is now starting to shake up the way farmers work. A dairy farm in the United Kingdom is already running a ‘connected’ herd with a view to anticipating the risks of epidemics and spotting random factors in milk production, a use of Big Data that looks set to revolutionize the sector. Now Monsanto’s purchase of Climate Corp confirms that this trend could be big business. In fact Climate Corp started out providing insurance for organizers of major weather-dependent events such as outdoor tennis tournaments and concerts but then re- focused its business on large agricultural players. By using weather data built up over a number of years, the company offers insurance policies covering specialty crops such as blueberries and avocados, which the US federal government insurance program does not cover. Monsanto CEO Hugh Grant argues that such services go far beyond insurance to enable better overall allocation of resources. “Everyone benefits when farmers are able to produce more with fewer resources,” he underlined.
The spread of smart sensors
The development of Big Data analytics rests of course on the widespread installation of sensors and connected devices to enable more detailed data to be gathered. Monsanto believes that data science services could be worth an additional $20 billion in revenues beyond its core business. Meanwhile, many startups are developing both terrestrial and satellite-based sensors which are speeding up the transition to ‘connected’ agriculture. Zaragoza, Spain-based company Libelium, which specializes in connected sensors, derives close to 20% of its turnover from sales to the agriculture and viticulture sectors. The company works with a number of vineyards in the Rias Baixas region of Spain, where wine-growers using their sensors have succeeded in reducing the application of fertilizers and fungicides by 20%, accompanied by a 15% improvement in overall productivity. One example of how connected sensors can help to increase productivity at a vineyard or farm is by managing a smart irrigation system which self-activates according to recorded rainfall and the level of soil humidity. Meanwhile the data gathered will feed into business planning and aid the development of new business models.