Industries in Depth

If agtech is to transform the world, farmers must feel the benefits

High-efficiency irrigation is one of the many agtech advances that could help bolster food systems.

High-efficiency irrigation is one of the many agtech advances that could help bolster food systems. Image: PepsiCo

Athina Kanioura
Chief Strategy and Transformation Officer, PepsiCo
Jim Andrew
Executive Vice-President; Chief Sustainability Officer, PepsiCo
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Agriculture, Food and Beverage

This article is part of: World Economic Forum Annual Meeting
  • Technology-enabled agriculture is needed to feed a growing world population amid the depletion of natural resources.
  • Agtech adoption rates will grow at the speed of trust as technologies become more accessible and farmers see clear ROIs.
  • Technological advancements are key to confronting global challenges – this requires both innovation and guardrails.

Agriculture has been woven into the fabric of humanity since time immemorial. Farmers have laboured throughout the world for centuries through droughts, changing meteorological patterns and evolving tastes to feed themselves and their communities. In the 1950s and 1960s, the Green Revolution significantly increased the number of calories produced per acre of agriculture as new innovations involving seeds, fertilizer and irrigation made a global impact.

However, it has become increasingly clear that we cannot rely on the agricultural practices of today if we are to fulfill the imperative of feeding the world amid the alarming pace of climate change, a swelling global population, the depletion of natural resources and rising sea levels.

In order to build the global food system of the future, we need to create the conditions that will help rapidly advance the application of technology in agriculture and bring the types of unlocks that have transformed so many other aspects of modern life. Using technology in smart ways may also help attract and retain the next generation of agricultural talent: an important consideration at a time where the average age of farmers in many parts of the world is about 60.

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In 2021, PepsiCo announced our goal to spread regenerative farming practices across 7 million acres, approximately equal to our entire agricultural footprint, by 2030. We realize that to make this ambition a reality we need to encourage the development and adoption of the technological solutions that make the transition to regenerative agriculture attractive and attainable to farmers.

We need leaps of imagination that harness the best of human ingenuity to help our farmers do more – such as producing higher yields and enhanced nutrition – with less: reducing environmental impact, conserving water, precision use of fertilizers and pesticides, and minimizing waste. And to prosper while doing so.

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There has been exciting progress in this direction over the past few years. A recent report from McKinsey notes that “external capital has been pouring into the upstream agriculture food-technology industry to the tune of about $18.2 billion in 2021, an approximate 38 percent year-on-year growth since 2013.”

However, while agtech may be attracting investors and grabbing media headlines, many startups in the space struggle to get beyond the initial investment, largely because adoption rates remain low, especially with regards to sustainability-related technologies, which McKinsey research says has reached only 6% adoption globally.

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How is the World Economic Forum helping farmers with technology?

In order to make technologies more accessible, solutions need to be human-centric and attainable, with practical applications and ROIs that are clear to farmers. A 2020 review of sustainable agriculture incentive programs published in the journal Nature found that: “In the long run, one of the strongest motivations for farmers to adopt sustainable practices is perceived benefits for either their farms, the environment or both. Beyond this, the importance of technical assistance and extension services in promoting sustainable practices emerges strongly.”

As Maximo Torero, Chief Economist of the Food and Agriculture Organization of the United Nations, has written, digitalization has the potential to be a great equalizer, ensuring that small-scale farmers are not left behind. And there is the potential for machine learning and AI to identify the right technology solutions for applications of technologies from the most basic to the most cutting edge.

At one end of the spectrum are elegantly simple solutions that address specific needs. For example, at PepsiCo, we have partnered with N-Drip, which has gravity-powered technology that combines the water-saving benefits of high-pressure drip irrigation with lower energy, operating and maintenance demands. This will enable farmers in our supply chain to adopt high-efficiency irrigation technology across 25,000 acres by 2025.

At the other end there is the application of AI, which has the potential to revolutionize crop management, reducing losses and ensuring optimal yields, helping farmers choose which seeds to use, where and when. Data collection through sensor technologies enables businesses to monitor every facet of farming. Drones provide a bird’s eye view that gives precise insights into soil conditions and crop health, allowing farmers to detect nutrient deficiencies or pest infestations at an early stage.

AI-based robots can bulk-harvest with greater accuracy and more quickly than humans, helping farmers reduce costs and cope with labour shortages. Using AI for predictive analysis can help farmers plan much more efficiently.

But we have to be sensitive to the legitimate concerns of farmers about the potential downsides of technology. We must be aware, for example, that proprietary data is part of what helps farmers earn their livelihood and should be protected. Progress and adoption will only come at the speed of trust, and safeguards must be established to protect farmer rights and preferences.

Governments also have an important role to play. It is essential that there is infrastructure to support digitalization and incentives that enable farmers to invest in their future. Access to electricity and broadband is a prerequisite for almost all technology and a barrier to adoption in places like Africa where about 60% of people rely on smallholder agriculture for food and income, but only 20% are online. Education, training and government-sponsored research also play important roles.

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What is the World Economic Forum doing to help ensure global food security?

We must prioritize attracting tech innovators while incentivizing tech companies to offer affordable, accessible options that never lose sight of the requirements and capabilities of the world’s farmers. Improving inclusiveness, livelihoods and planetary impacts is both good business and good stewardship. Now is the time for agricultural stakeholders across the global value chain to seize the opportunity to provide a gateway to a new era.

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Industries in DepthForum InstitutionalNature and BiodiversityEmerging Technologies
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