The Future Of Food And Agriculture

The global economy continues to prioritise agriculture. A catalytic transformation is currently occurring in agriculture. The industry is incorporating and implementing cutting-edge technologies to improve the productivity of farming operations and consequently increase production. An agriculture and food marketing system includes all of the operations and organisations that carry out those operations required to successfully take advantage of market opportunities. Agriculture is on the frontlines of nearly all urgent global challenges, from hunger to climate change to rising inequality. Food-insecure regions are disproportionately impacted by climate change, which threatens fish stocks, fisheries, agricultural and livestock output. Increased greenhouse gas emissions, more intense competition for natural resources, and further deforestation and land degradation are expected outcomes of trying to meet growing agricultural demand with current farming methods. While the production of crops depends on high-quality soil and water, dependable weather, and a long enough growing season, livestock diseases can seriously impair both human and animal health. Drought may result in a lack of supplies, and price volatility may be influenced by changes in exchange rates or new trade restrictions. The livelihood of farmers is directly impacted by these hazards, which have an effect on agricultural economic returns. Climate change will make the problems facing the food, agriculture, and fishing industries worse. While rain has become less dependable, global average temperatures have been breaking records practically every year. Floods, droughts, and big storms are just a few examples of the extreme weather occurrences that regularly harm crops.

According to a report released on June 2022, by the Food and Agriculture Organization of the United Nations (FAO) and the Organization for Economic Co-operation and Development (OECD), the global agrifood sector faces fundamental challenges over the coming decade, particularly the need to feed an ever-increasing population in a sustainable manner, the effects of the climate crisis, and the economic repercussions and disruptions to the food supply linked to the war in Ukraine (OECD).

Future food production will be based on how effectively natural resources are maintained and managed since food, agriculture, and fisheries depend on them. Urban land growth and increased water demand from other industries have an impact on agriculture. Fisheries governance in traditional fishing areas is complicated by development in coastal zones. Oil and gas exploration, maritime shipping, and land-based industries all have an impact on the ocean ecology, and their pollution can result in habitat loss and a decline in biodiversity. Where these resource pressures are most intense, there are agricultural risk "hotspots" that develop. The greatest challenge in maintaining food production is anticipated in these locations.

Redefining Agriculture Through Artificial Intelligence:

Smart agricultural techniques are being adopted across all region and are quickly emerging as a key trend for Smart Agriculture market. Resource management that is technologically advanced, the modernization of agri supply chains, a strategy for reducing climate risk, and the digitization of farm collectives as farmer producer organisations (FPOs), Government investments in digital farming and the establishment of a start-up ecosystem are some of the steps being taken to promote intelligent agricultural techniques. Robotics, sensors, and soil sampling are being used more and more by farmers to collect data that is kept on farm management systems and allows for better processing and analysis. The availability of such agricultural data is paving the way to deploy AI driven Smart Agriculture Market.

There are some major trends in the Smart Agriculture Market system which are leading to the adoption of innovative and transformative smart farming practices around the World. Discussed below are major trends that are paving the way for such transformation:

Smart and technology-driven resource management - In terms of the best possible resource utilisation, water management is one of the most significant projects. Such programmes include drip irrigation and watershed control. The Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) was launched with a total allocation of INR 50,000 crore19 (from 2015–16 to 2019–20) over a five-year period as a result of the GoI's intense focus on this issue. In order to increase irrigation efficiency, INR 4,000 crore has been Go’s aside as part of the allocation under the PMKSY's Per Drop More Crop programme.
Modernisation of the agri supply chain - With improved value chain connections and access to the global market, along with environmental concerns, food safety and quality, and animal welfare requirements, integration in the agriculture industry is growing. To lessen the attempts are being made to increase operational effectiveness by concentrating on essential quality, traceability, logistics, and distribution are a few examples.
Preponderance and digitising farm collectives as FPOs - Farmer producer groups (FPOs) are founded when a group of marginal and small farmers got together to conduct farming activities and enterprises as constituents of a group. FPOs assist in fostering prospects for improved credit. Infrastructure for quality management include facilities, insurance terms, and post-harvest management (PHM), alternatives for better crop management using precision for Smart Agriculture Market.
Climate risk mitigation strategy - Numerous steps are being taken to develop a climate risk mitigation strategy as India experiences significant agricultural losses as a result of the unpredictable weather in the nation. In calculating and reducing risks brought on by unforeseen climate change scenarios, early warning system solutions are essential. One such endeavour is automatic weather stations (AWS). To measure atmospheric conditions and give historical weather data for production planning, they are made up of weather and lightning sensors, rain gauges, and data loggers.
Government initiatives in digital farming- One of the key factors boosting production and advancing agricultural development is the adoption of cutting-edge technologies. Along with the growing emphasis on utilising technology to boost production, productivity, and farm incomes, policies for agricultural development are also receiving more attention. Through a digital mission for 2021–2025, the government has launched numerous projects based on cutting-edge technologies like artificial intelligence (AI), blockchain, remote sensing, geographic information systems (GIS), drones, and robotics. With several of the key industrial players in the digital sector, the Ministry of Agriculture has signed an MoU for pilot projects. With the India Digital Ecosystem for Agriculture (IDEA) programme, the GoI is also focused on digitising the data of farmers. For instance, Agriculture Secretary Tom Vilsack unveiled the specifics of the U.S. Department of Agriculture's (USDA) $300 million investment in a new Organic Transition Initiative that will help create new and better markets and streams of income for farmers and producers, including funds from the American Rescue Plan. Producing organically enables farmers to keep a distinct position in the market and earn a larger portion of the food dollar.

Over half of all investments in sustainable farming in Europe were made in controlled environment agriculture, or CEA, last year. However, data from a new special study on European climate investing by AgFunder and Invest-NL indicates that investments in sustainable agriculture are both underfunded and a significant opportunity for investors seeking climate investing approaches. Just 25% of the $9.2 billion invested in European agrifoodtech last year went to businesses with environmentally beneficial solutions. 9.5% of the agrifoodtech investments in Europe were made in sustainable agriculture. Innovative farming technologies, novel foods, farm robotics and machinery, as well as certain agbiotech and biomaterials and energy, are among the AgFunder investment categories that are most closely associated with the category and with climate effect.

Agriculture Related Investments in Europe, 2022

Source: AgFunder

Thus, it is observed that the Global agricultural ecosystem is in the process of infusing technologies aiming at enhancing the incomes of farmers. These innovations are driven by the Fourth Industrial Revolution and comprises technologies such as AI, ML, IoT, big data, drones and blockchain, and aimed at bringing rapid and large-scale changes to increase efficiency and productivity of the Smart Agriculture Market.

Depending on the nature, technology, and industry, different AI technologies for Smart Agriculture have also been categorised into various categories.

Crop Monitoring - In order to combat drought and other detrimental environmental phenomena affecting agriculture, drone-based crop monitoring is being deployed globally. Drone 3D imaging is used to forecast things like soil quality, farm patterns and parameters, diseases, and pest infestations, among other things. Crop chemical spraying using drones is also common since, according to analysis, it can be done five times as quickly as with traditional machinery. However, caution must be exercised to prevent chemical contamination of groundwater. Enhancing the nutrient quality of the grains, for instance, using XRF analyzers to determine the mineral content of the grains, grain analyzers to establish traceability and digitalize the quality of grain seeds, and hyperspectral imaging analysers can be used to forecast changes in nutrient concentration in leaves as they develop.

Robotics In Agriculture - Robotics use has increased production and increased yields in agricultural operations. Robotic weeding and chemical application can reduce pesticide use by about 90%. Robots can eliminate weeds without human assistance since they are capable of travelling agricultural rows on their own. They use a laser and camera for direction. By using robots instead of traditional methods, plant transplantation is becoming more effective. Additionally, fruit picking and nut harvesting are done by robots.

RFID Sensors and Tracking - Consumers' food can be tracked from source using radio frequency identification (RFID) devices. By creating an end-to-end traceability trail for a product, such sensors increase product conformity and trustworthiness for fresh and high-quality goods.

Geographical And Value Chain Spread Of AI In Agriculture

In 1985, artificial intelligence (AI) in agriculture was first tried, and since then, its application has advanced significantly. According to FAO, by 2026, it is anticipated that AI in agriculture would be valued USD 4 billion globally. Due to its early embrace of cutting-edge technologies for various agricultural operations, North America has emerged as the region with the greatest Smart Agriculture Market. Additionally, the European Union (EU) launched the largest civil robotics funding initiative, prioritising agri-food as one of the robotics program's four application areas. Horizon 2020 is the EU's research and innovation funding programme, with a nearly EUR 80 billion budget. By implementing Internet of Food and Farm 2020 (IoF2020), DEMETER, Agricultural Interoperability and Analysis System (ATLAS), and SmartAgriHubs with an investment of EUR 80 million, the EU has placed a heavy emphasis on digitising the agriculture sector. The food and agriculture industries in Latin America and the Caribbean have seen an increase in AgriTech-related technical innovation in recent years. AI and ML are also being widely adopted in agriculture by nations like China and India.

Eagerly Embracing The Future Of Food And Agriculture

Globally, it appears that the Food & Beverage sector is embracing the Future Of Food And Agriculture due of its potential advantages. The aim of climate-smart agriculture is to sustainably increase food security and incomes while also adjusting to the effects of climate change and fostering resilience. It links various innovations, such as organic farming, sustainable agriculture, agroforestry, and creation of crop types with increased resistance to pests, diseases, salinity, waterlogging, and drought (FAO, 2013). More than 30 nations specifically mentioned climate-smart agriculture in sub-Saharan Africa their intended contributions, which are national commitments with a reduction, in preparation for the 21st Conference of the Parties to the UN Framework Convention on Climate Change, which took place in Paris in 2015 December.

Annual GDP growth rates 2022-2031

Source: OECD/FAO (2022), "OECD-FAO Agricultural Outlook", OECD Agriculture statistics (database)

Table 1. The Future Of Food And Agriculture: A Food & Beverage Industry View – Investments/Partnership/Acquisition/Product Launch/Acquisition/Expansion - Summary

COMPANY NAME	DEVELOPMENT DATE	DEVELOPMENT TYPE	DESCRIPTION
CNH Industrial	May, 2021	Launch	CNH Industrial introduced "AGXTEND," a cutting-edge platform for digital agricultural solutions, in Brazil. The firm offers the finest standards throughout the entire agricultural cycle to all different kinds and profiles of farmers. The monitoring and management solutions are based on drone photos and soil diagnostics, and the customer pays for the service provided rather than the equipment.
Bayer Crop science	April, 2020	Collaboration	In order to assist Mexican farmers in meeting the expanding worldwide demand for digital solutions sustainably, Bayer Crop Science and Prospera collaborated in 2020. The strategic alliance gives greenhouse vegetable growers data insights and AI for better outcomes and sustainability.
Deere & Company	July, 2021	Launch	JDLINK, an information management solution, was introduced by Deere & Company. The product offers connectivity services without charging extra. Customers receive a single level of service via JDLink connectivity, which includes all of the functionality found in the Operations Center as well as sharing of machine and agronomic data. With this modification, users may fully utilise connected support and precision agriculture technology on their farm.
AGCO	April, 2021	Partnership	In a strategic alliance with the cutting-edge agricultural equipment company EZ-Drops, AGCO Corporation will give its North American dealers access to a brand-new nutrition delivery system. Customized setups of the fertiliser application system are offered by AGCO's RoGator dealers. This technology will assist farmers in reducing excessive nitrogen spraying, which lowers farm profitability.
CropX	January, 2020	Acquisition	In order to enter the American market, CropX, a top provider of soil and agricultural analytics, purchased CropMetrics. The goal of this acquisition was to expand CropMetrics' product offerings throughout the major U.S. areas by utilising their extensive dealer network, service model, user-friendly platform, and Variable Rate Irrigation System.

Factors that Are Expected To Disrupt The Status Quo Of The Agricultural System By 2030, While Meeting The Objectives Of Climate-Smart Agriculture –

Across the sowing to harvesting value chain, precision agriculture and automation will be the standard, even among smallholders.
A biotechnological quantum leap will result in plants that are more nutrient- and drought-resistant, and that govern farm health more effectively.
To create economies of scale for smallholders, disparate landholdings and asset ownership will undergo broad real-world and virtual consolidation.
Farmers will offer increased safety & quality, increase income, and improve relationships with both local & international consumers.
Agriculture training will adapt to meet the needs of a younger farmer as agricultural labour contracts and moves to better productivity positions higher up the value chain.
High-value output production, like that of leafy greens and cruciferous vegetables, will become more specialised, protected, and have its own specific logistical chain.
Rising demand for dairy products and animal proteins will accelerate the deployment of technology throughout the animal and fishery value chains, diversifying diets, boosting productivity, and responsibly reducing costs.
Food science will prioritise the needs of the consumer, resulting in low-cost processed foods that address undernourishment, lifestyle diseases, and environmental issues.

Economic Growth And Population Dynamics Are Enhancing The Structural Change Of Economies.

Across regions, the rate at which agriculture's contribution to overall productivity and employment is declining varies. Agricultural investments and technological advancements are increasing production, but yield growth has stalled to uncomfortably low rates. Reducing food losses and waste, which account for a sizeable amount of agricultural output and minimise the need for production increases. The degradation of natural resources, loss of biodiversity, and the spread of transboundary pests and illnesses of plants and animals, some of which are becoming resistant to antibiotics, all hinder the acceleration of productivity development that is required for Smart Agriculture.

Regional Contributions To Food Demand Growth, 2012-21 and 2022-31

Source: OECD/FAO (2022), “OECD-FAO Agricultural Outlook”, OECD Agriculture statistics (database)

The list of difficulties the Food & Beverage sector is now facing is shown below. Although not all possible obstacles are included here, the most obvious one’s are listed. Several factors that may delay the growth are:

Resource Depletion And Climate Change Pose Major Challenges

Climate change complicates the resource demand. Climate change may reduce global average yields of rice, wheat, and maize by 6–10% by 2050, while water shortages in important areas of Northwest India, Northeast China, and the Southwest United States may raise the price of the same crops internationally by 5–7% during the same period.
The environment has an impact on the food, agricultural, and fisheries system, but so do production methods that may have an impact on land, water, biodiversity, and greenhouse gases.
12% of the world's greenhouse gas emissions are directly attributable to agriculture, mostly methane from cattle and rice production as well as nitrous oxide from fertiliser emissions. Since it uses the most water, it has the potential to destroy biodiversity and degrade water quality due to fertiliser, manure, and pesticide runoff. A significant contributor to water pollution, excessive nutrient usage in agriculture is thought to have diminished biodiversity in wetlands, lakes, and rivers by around one-third globally.
Although improvements have been achieved in how agriculture affects the environment and natural resources, OECD study reveals that many countries still face serious problems with resource consumption and pollution.
The difficulty of managing resource depletion and climate change is anticipated to worsen as global demand for food and non-food goods rises, driven mostly by population and income development. By 2050, it is anticipated that there will be 9.7 billion people on the planet, with the majority of that growth occurring in Sub-Saharan Africa, India, the Middle East, and North Africa. Increased demand for a wider variety of food and non-food products is also being fueled by income growth in developing and rising nations.
The difficulties here are not an exhaustive list of all difficulties affecting Food & Beverage organisations. Depending on the Food & Beverage system from many angles, such as finance systems, socioeconomic conditions, and other elements particular to a particular country or region, the problems can vary. But as the COVID-19 pandemic has demonstrated, Food & Beverage all across the world continue to be vulnerable and face similar problems due to demographic changes, population increase, and infodemic effects.

Possible Trends In The Future Evolution

In the coming years, digitalization has the potential to significantly change the food, agriculture, and fisheries systems. The sector as a whole might benefit substantially from the use of mobile devices, data analytics, high-quality satellite imaging, precision equipment, and artificial intelligence, among other things. In hypothesis, new technological advancements could enable farmers to more precisely monitor their crops and livestock, to fine-tune the application of inputs (such as fertilisers and feed supplements), and to use vast amounts of data to determine the best production options for agriculture and aquaculture. While traceability systems can follow items along the value chain, giving customers information on the origin of the food they buy, farmers and fishers might connect to markets and to vital up-to-date market information more easily. Digital technologies might also make it possible for more thorough surveillance of illegal fishing, which would aid in more sustainably managing stock levels. By associating support with observable results, they can also help to better focus and enhance agricultural and environmental policies. They can also help to facilitate cross-border trade, for instance by automating administrative and customs procedures.

Annual change in feed use and in livestock production, 2022-2031

Source: OECD/FAO (2022), “OECD-FAO Agricultural Outlook”, OECD Agriculture statistics (database)

It is becoming more urgent for governments to adjust their policies in light of the new opportunities and challenges. Governments may start undoing policy changes right away, including those that promote unsustainable production and other environmental harms. Additionally, by doing so, limited financial resources would be freed up to be used for high-return investments in innovation systems, physical and digital infrastructure, targeted climate and environmental initiatives, and risk management systems. Such specialised and focused policy initiatives would open markets for more open and equitable commerce in food, agricultural, and fisheries products, paving the road for Smart Agriculture market advancement.

Market participants also believe global regulatory frameworks to be more adaptable and business-friendly. All of these considerations are causing market participants to place a greater emphasis on emerging markets in the future years. As a result of rising healthcare spending as well as significant players in emerging economies expanding their businesses, the Food And Agriculture market is expected to rise rapidly.

All these factors will lead to a market structure characterized by the presence of vendors that will make Food And Agriculture Industry competitive, economically, and qualitatively, compared to traditional methods of production.

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