The Rise of Connectivity in Agriculture
The agriculture industry has undergone a remarkable transformation over the past few decades. Advances in machinery have expanded the scale, speed, and productivity of farm equipment, leading to more efficient cultivation of more land. Seed, irrigation, and fertilizers have also vastly improved, helping farmers increase yields. Now, agriculture is in the early days of yet another revolution, at the heart of which lie data and connectivity.
Artificial intelligence, analytics, connected sensors, and other emerging technologies could further increase yields, improve the efficiency of water and other inputs, and build sustainability and resilience across crop cultivation and animal husbandry. As the world experiences a quantum leap in the speed and scope of digital connections, industries are gaining new and enhanced tools to boost productivity and spur innovation.
Over the next decade, existing technologies like fiber, low-power wide-area networks (LPWAN), Wi-Fi 6, low- to mid-band 5G, and short-range connections like radio-frequency identification (RFID) will expand their reach as networks are built out and adoption grows. At the same time, new generations of these technologies will appear with upgraded standards. In addition, new types of more revolutionary—and more capital-intensive—frontier connectivity like high-band 5G and low-Earth-orbit (LEO) satellites will begin to come online. Together, these technological developments will unlock powerful new capabilities across industries.
Near-global coverage will allow the expansion of use cases even to remote areas and will enable constant connectivity universally. Massive use of Internet of Things (IoT) applications and use cases will be enabled as new technologies allow very high device densities. And mission-critical services will take advantage of ultra-low-latency, high-reliability, and high-security connections.
Overcoming Barriers in Agricultural Digitization
However, without a solid connectivity infrastructure, none of this is possible. If connectivity is implemented successfully in agriculture, the industry could tack on $500 billion in additional value to the global gross domestic product by 2030, according to research. This would amount to a 7 to 9 percent improvement from its expected total and would alleviate much of the present pressure on farmers.
The agriculture industry remains less digitized compared with many other industries globally. Past advances were mostly mechanical and genetic, but now, much more sophisticated digital tools are needed to deliver the next productivity leap. Some already exist to help farmers more efficiently and sustainably use resources, while more advanced ones are in development.
The industry confronts two significant obstacles:
1. Lack of connectivity infrastructure: Some regions lack the necessary connectivity infrastructure, making its development paramount.
2. Slow adoption of digital tools: In regions that already have a connectivity infrastructure, farms have been slow to deploy digital tools because their impact has not been sufficiently proven.
The COVID-19 crisis has further intensified other challenges agriculture faces, such as efficiency, resilience, digitization, agility, and sustainability. Lower sales volumes have pressured margins, exacerbating the need for farmers to contain costs further. Gridlocked global supply chains have highlighted the importance of having more local providers, which could increase the resilience of smaller farms. The crisis has accentuated the necessity of more widespread digitization and automation, while suddenly shifting demand and sales channels have underscored the value of agile adaptation.
Leveraging Connectivity for Agricultural Transformation
In recent years, many farmers have begun to consult data about essential variables like soil, crops, livestock, and weather. Yet few, if any, have had access to advanced digital tools that would help turn these data into valuable, actionable insights. Even in the United States, a pioneer country in connectivity, only about one-quarter of farms currently use any connected equipment or devices to access data, and that technology isn’t exactly state-of-the-art, running on 2G or 3G networks that telcos plan to dismantle or on very low-band IoT networks that are complicated and expensive to set up.
The connectivity coverage is increasing almost everywhere, and by 2030, we expect advanced connectivity infrastructure of some type to cover roughly 80 percent of the world’s rural areas. The key is to develop more—and more effective—digital tools for the industry and to foster widespread adoption of them. As connectivity increasingly takes hold, these tools will enable new capabilities in agriculture.
By the end of the decade, enhanced connectivity in agriculture could add more than $500 billion to global gross domestic product, a critical productivity improvement of 7 to 9 percent for the industry. However, this value will require investments in connectivity that today are largely absent from agriculture.
Other industries already use technologies like LPWAN, cloud computing, and cheaper, better sensors requiring minimal hardware, which can significantly reduce the necessary investment. We have analyzed five use cases where enhanced connectivity is already in the early stages of being used and is most likely to deliver the higher yields, lower costs, and greater resilience and sustainability that the industry needs to thrive in the 21st century:
- Crop Monitoring
- Livestock Monitoring
- Building and Equipment Management
- Drone Farming
- Autonomous Farming Machinery
Unlocking Value through Sensor-Driven Use Cases
Crop Monitoring
Integrating weather data, irrigation, nutrient, and other systems could improve resource use and boost yields by more accurately identifying and predicting deficiencies. Sensors deployed to monitor soil conditions could communicate via LPWAN, directing sprinklers to adjust water and nutrient application. Sensors could also deliver imagery from remote corners of fields to assist farmers in making more informed and timely decisions and getting early warnings of problems like disease or pests. Smart monitoring could also help farmers optimize the harvesting window and monitor crops for quality characteristics to maximize revenue.
Livestock Monitoring
Chips and body sensors that measure temperature, pulse, and blood pressure, among other indicators, could detect illnesses early, preventing herd infection and improving food quality. Environmental sensors could trigger automatic adjustments in ventilation or heating in barns, lessening distress and improving living conditions that increasingly concern consumers. Better monitoring of animal health and growth conditions could produce $70 billion to $90 billion in value by 2030.
Building and Equipment Management
Chips and sensors to monitor and measure levels of silos and warehouses could trigger automated reordering, reducing inventory costs for farmers. Similar tools could also improve shelf life of inputs and reduce post-harvest losses by monitoring and automatically optimizing storage conditions. Computer vision and sensors attached to equipment and connected to predictive-maintenance systems could decrease repair costs and extend machinery and equipment life, generating $40 billion to $60 billion in cost savings by 2030.
Drone Farming
Drones can survey crops and herds over vast areas quickly and efficiently or as a relay system for ferrying real-time data to other connected equipment and installations. Drones can also use computer vision to analyze field conditions and deliver precise interventions like fertilizers, nutrients, and pesticides where crops most need them. By reducing costs and improving yields, the use of drones could generate between $85 billion and $115 billion in value.
Autonomous Farming Machinery
Precise GPS controls paired with computer vision and sensors could advance the deployment of smart and autonomous farm machinery. Farmers could operate a variety of equipment on their field simultaneously and without human intervention, freeing up time and other resources. Increasing the autonomy of machinery through better connectivity could create $50 billion to $60 billion of additional value by 2030.
Embracing the Connectivity-Driven Future of Agriculture
The global farming industry is highly fragmented, with most labor done by individual farm owners, particularly in Asia and Africa. The adoption of connectivity solutions on such farms should free significant time for farmers, which they can use to farm additional land for pay or to pursue work outside the industry. We find the value of deploying advanced connectivity on these farms to achieve such labor efficiencies represents almost $120 billion, bringing the total value of enhanced connectivity from direct and indirect outcomes to more than $620 billion by 2030.
However, the extent to which this value will be captured relies largely on advanced connectivity coverage, which is expected to be fairly low around 25 percent in Africa and poorer parts of Asia and Latin America. Achieving the critical mass of adopters needed to make a business case for deploying advanced connectivity will also be more difficult in those regions where farming is more fragmented than in North America and Europe.
As the agriculture industry digitizes, new pockets of value will likely be unlocked. Input providers, telcos and LPWAN providers, and agritech companies are all playing critical roles in the emerging data ecosystem. Telcos and LPWAN providers have an essential role to play in installing the connectivity infrastructure needed to enable digital applications on farms, while agritech companies specialize in offering farmers innovative products that make use of technology and data to improve decision-making and increase yields and profits.
The public sector could also play a role by improving the economics of developing broadband networks, particularly in rural areas. Eventual deployment of LEO satellite constellations would likely have a similar impact, accelerating the development of connective products by cost-effectively giving input providers and agritech companies assurance of a backbone over which they could deliver services.
Agriculture, one of the world’s oldest industries, finds itself at a technological crossroads. To handle increasing demand and several disruptive trends successfully, the industry will need to overcome the challenges to deploying advanced connectivity. This will require significant investment in infrastructure and a realignment of traditional roles. It is a huge but critical undertaking, with more than $500 billion in value at stake. The success and sustainability of one of the planet’s oldest industries may well depend on this technology transformation, and those that embrace it at the outset may be best positioned to thrive in agriculture’s connectivity-driven future.