Finding the Promised Agtech Neverland
Sep. 12, 2018
How rigorous is this case for Indian Agtech?
If you are one of those who prefer orgasm by numbers, I can peddle many. Here is the most important one from the sunny side.
If McKinsey Global Institute is to be believed, the application of various digital and agronomic technologies can have an economic impact of USD 45–80 billion annually by 2025.
Here is the infographic from Livemint along with the fine print.
Of course, these numbers are packaged to look salivating, but, we know how messy the road to digital transformation looks from the ground up. In a country with 15 out of 20 major world climates and 46 out of 60 soil-types, we know the mind-boggling complexity and the possibilities that beckon us when we talk about digital transformation in Indian Agriculture.
And so, the real question is, if you had a crystal ball, how would the Agriculture of tomorrow look like?
It takes someone of the stature of Sivakumar Surampudi, Group Head-Agri Business, ITC Limited, to tackle the question head-on, and it was a pleasure to watch him address the question masterfully.
Allow me to summarize his points, and colour them with my perspectives.
Addressing the question from the vantage point of three stakeholders, viz., a) Consumers b) Farmers c) Kids (to whom we are accountable for what we are doing to Planet Earth today), he set the ground context by addressing the conflict enmeshed in reconciling what each of these three stakeholders want.
For all the talk about empowering farmers, the bare fact of the matter is that Indian consumers are habituated to demand more food for less price. (Don't try to challenge that notion, unless you are in for a premium, niche game play)
How can we curb food prices and make farming profitable? Mind you, addressing the conflict packed inside that "and" is no ordinary challenge.
Why does increase in crop output doesn't translate to increase in farmer incomes?
If we are serious about this question, we need to look straight into the eye of the conflict enmeshed in balancing the needs of farmers and consumers. When farmers dump vegetables, they vocalize the frustration of the prices not worth even a penny to carry on with post-harvest activities. In such a scenario, how can technology help in ameliorating the stressful journey Indian food takes from the farm to the consumer plate?
When 65% of India's farmlands meet its requirements from rainwater alone,how do we bring in the appropriate technologies which can withstand extreme weather, diverse soil conditions and cope with biotic stresses?
Talking of weather, we need to talk about what we owe to that often forgotten stakeholder, our kids whose lives will be significantly impacted by Climate Change tomorrow.
We are already running in Earth deficit, if you go by the 2018 edition of Earth Over shoot day, which came on August 1st.
For the uninitiated, Earth Overshoot Day is the day each year when humans have consumed a year's worth of the planet's natural resources. Calculated by the Global Footprint Network, an international nonprofit, this calculation takes a number of factors, including the earth's capacity to sequester carbon and how much food and other natural resources can grow in one year.
Now, if you are brave enough to address these tripartite conflicts and challenges, what are the three likely futuristic scenarios we can envisage about the future of agriculture?
1) Farms as Factories: If you are tracking the fast-track developments in hydroponics, vertical farming, Agricultural LED lights, you will understand what I am talking about. If you look past the existing price cliffs, and track the trajectory of evolution going forward, you will see the glimmer of possibility Sivakumar is alluding to.
Can consistent quality of output be produced, crop after crop, by leveraging emerging technologies, across the inputs value chain (like seed, nutrients, farm-equipment, agronomy practices etc), leveraging digital marketplace infrastructure (IoT, Block chain, hyper-spectral imaging, GPS / GIS etc)?
2) Homes as Farms:
Now, this scenario would look far-fetched, considering how disconnected our urban lives are today from nature. Sure, there is burgeoning interest in vertical farming, balcony farming, kitchen gardens. But can these grow to become a sustainable business model?
Most of the Agritech firms today which are on the road to profitability are seeing a lot of traction through B2B2F models, instead of directly selling to farmers. Although this is likely to change, if you look at the rapid digitization (Thank you Jio) happening in the rural regions, how can we map the next level of change?
Try and understand this from urban consumer mindset. Food grown from homes are safe in the consumer mind, and carry zero carbon miles. Even if you are not the type who grows food inside your homes, wouldn't urban consumers be open to business models in which Agri-input manufacturers provide agri-inputs for apartment growers and provide managed farming services in urban terraces?
Can we expect to see service providers who operate on a BOO model on outsourced colony and apartment spaces?
And if this model builds traction, you can perhaps predict the next level of evolution. Can a group of socially conscious consumers collaborate to build newer Community-Supported-Agriculture models with proximate farmers?
In the outskirts of Bangalore, I know of a group which has been facilitating such a model between urban consumers and farmers. If I pay a certain monthly subscription amount to a group of farmers, I under-write the farmers' crop production risks, and consent to receive the produce straight from the farmers every weekend. Wouldn't nature-starved urban consumers be open to such community farming experiments?
Given amount of internet penetration among farmers (Thank you Jio, once again), a simple Whatsapp group is today sufficient to facilitate this with e-commerce functionality.
In a nutshell, what this model is exploring is this: Can we transform the food value chain from "selling the produce to producing the buys"?
3) Back to Basics: Today, as the global agricultural research community walk the full-circle to understand the ills of mono-cropping paradigms and appreciate the benefits of traditional practices such as crop rotation and no-tilling practices, can we expect to see a resurgence of farming models which focus on going squarely back to the basics?
Can we expect to see an integrated farm model in which poly culture, perma culture, organic compost, bee-keeping, animal husbandry, renewable energy come together to bring a recurring, predictable income flow for farmers?
Which of these three "Future of Agriculture" scenarios are you betting your money on? How are you seeing these trends? How do you see the role of Agri-Input manufacturers in the light of these futuristic trends? What drives your optimism about the future of Agriculture?
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