Comment: Using data to transform the agriculture industry

Across the UK, there is a desperate need to take action on the way food is produced.  As the world continues to see the challenges of the climate crisis impacting farming, the growing influence of technology across the industry can be used to tackle these issues. However, for this to become a reality, it is pivotal for businesses to begin collaborating to improve connectivity and efficiency across the farming industry to create a nature-positive food system. 

The agricultural sector currently, directly or indirectly, accounts for over a quarter (26 per cent) of global greenhouse gas emissions. Additionally, the enormous amount of food waste generated each year—a staggering 12.8 million tonnes—is a major cause for concern, with 25 per cent of this waste originating at the farming stage.

All things considered, there is a real need to develop new solutions that will make agriculture more efficient, saving costs and optimising resources. One way to work towards this is through technological innovation in the farming sector. 

A fragmented industry  

When it comes to data, the agricultural industry is a very fragmented ecosystem. This is unlike some other industries such as pharmaceuticals, where production is more concentrated and standardisation ensured through regulatory control.  The sector comprises millions of independent farmers who cultivate hundreds of diverse crops, and who each require distinct farming techniques in diverse environmental conditions that vary from place to place. Additionally, the supply chains are lengthy and function differently across markets. 

Consequently, any scenario that involves the measurement of multiple factors across various steps or farms, requires the consolidation and retrieval of data from distinct individuals, systems and structures, all of which lack uniform standards. With such a complex system of data collection, the potential of data is left untapped as it is extremely difficult to coordinate. 

Regulatory control often helps to ensure standards in other industries, but it is also true that there are fewer major actors, shorter supply chains, and therefore it is easier to align effectively. In contrast, the agriculture industry has been developed over centuries under varying local conditions, resulting in a vast array of individual processes and solutions. It is challenging to standardise how food is farmed in the same way as goods are shipped.

Additionally, the implementation of data standards in agriculture is difficult because the beneficiaries are several steps removed from those who collect the data, resulting in weakened influence to make them happen. When there is no clear financial incentive to abandon established practices and adopt new ones, such as when a customer demands it, change is unlikely to occur naturally.

How can we reshape farming?

Incentives play a crucial role in driving change, as they determine the actions and behaviours of individuals and organisations. To achieve a specific goal, it is necessary to align the incentives of all actors involved in the supply chain. 

In the case of farming, growers are incentivised to maximise yield and minimise costs, which often leads to unsustainable practices that result in high greenhouse gas (GHG) emissions.  If only we can embed incentives to do so in balance with preserving the natural capital of the land, real, scalable change will occur.  However, the actors who have an incentive to reduce emissions, such as retailers or consumers, are often several steps removed from the grower. This requires complex collaboration to align the incentives of all actors and achieve the desired outcome. 

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To incentivise change, it is necessary to reward some actors for sustainable practices and penalise others for unsustainable practices. Therefore, it is also necessary to differentiate and measure each practice. Unlike yield, GHG emissions cannot be objectively measured at the point of delivery. Instead, data must be collected from the farm and used by other actors.

To measure and incentivise sustainable practices, it is vital to not only measure operations at the individual farm level but also beyond it and across the entire supply chain. To achieve this, it is crucial to aggregate consistent data about each actor. The time-related cost of integrating data across the supply chain depends on the consistency of data formats. If there are numerous platforms each with their own identifiers, definitions of a crop, or data formats for recording operations, it becomes more time consuming  and, therefore, expensive to integrate the data.

To overcome this cost and achieve sustainable change, it is necessary to standardise data collection and indexing practices across the entire supply network. Standardisation enables consistent data collection and reduces integration costs, making it more feasible to measure and incentivise sustainable practices.

The bottom line 

Addressing the issue of data fragmentation can significantly help sustainable practices within the industry. The agricultural industry has already been benefitting from the introduction of a number of technological innovations, and effective data-use could be a powerful tool to help track the overall environmental impact of the food industry and to manage it better, supporting initiatives and efforts that move towards minimising its negative effects. By aligning incentives throughout the industry, agriculture can begin taking steps towards better data-use and therefore more sustainable practices.

Andy Jenkinson, CTO of Varda