AgriTech is a fast developing area. But what exactly is it and why is it attracting so much investment? We shine a spotlight on this sector and try to demystify the tech in AgriTech.
AgriTech is the optimisation of farming. Finding efficiencies in the supply chain helps to maximise profit for farmers, as well as having a positive impact on sustainability and the environment. These efficiencies in "smart farming" are found in a range of innovative ways, such as using data and connectivity, robotics, and farming as a service solutions. These “FaaS” solutions allow stakeholders to make decisions using data, increasing productivity and efficiency.
Getting in the farm gate
AgriTech has been singled out as a trending sector in the investment community. This interest is only set to grow. According to Pitch Book investment in AgriTech rose by 60% between 2020 and 2021.
Notable investments have been made in precision farming, agri-biotech and vertical farming. Growing crops in vertically stacked layers allows ten times the yield for a given area. The world's largest vertical, indoor farm is due to open in Norfolk next year. The four-acre site is set to supply 6.5 tonnes of produce all year round.
Success in agriculture is built on years of knowledge and evolution of practices between generations. Often the knowledge is specific to the type of agricultural business at hand, whether that be arable or livestock. There are a variety of factors determining farming success across the UK and internationally. Increased investment will help tackle the challenges faced by AgriTech businesses in getting their tech to farmers in a way that recognises their specific needs.
The rise of AgriTech should drive down costs, helping to break down barriers to market entry faced by farmers. Although high upfront investment is often needed to implement AgriTech, this investment has proven to pay off in the longer term.
Climate change and sustainability
As well as increasing profits and productivity on the farm, AgriTech can help tackle some of the most pressing issues facing the world.
AgriTech businesses are bringing new ideas to an industry that is currently responsible for one third of the global greenhouse gases emissions. These businesses are driven by shifts in our eating habits, global population growth, climate change, soil quality, biodiversity and a very real target to reach net zero by 2050.
One area that can benefit from new tech in farming is the reduction of food waste. Whether lost in the field, spoiled in the supermarket, or cast out by a consumer, 30% of the food produced on the planet is wasted each year. That equates to around $1 trillion.
With a growth in the general population’s awareness, and a desire to reduce waste, environmental and social governance (ESG) is becoming increasingly urgent. The demand for dynamic and ground breaking technology to reduce waste and increase efficiencies will become ever more popular, and the market for AgriTech innovations in this area will become increasingly significant.
Precision Breeding Bill
Regulators have proposed a new bill to increase innovation in food production and move away from EU regulation. Once passed, the Genetic Technologies (Precision Breeding) Bill will make it easier and cheaper for gene edited products to be sold in England.
The Bill’s aims are to encourage agricultural and scientific innovation and to “unlock the potential of new technologies to promote sustainable and efficient farming and food production” (Queen’s speech, May 2022).
It is expected that the change in law will result in a substantial increase in innovative solutions using gene editing, with benefits for farmers and producers such as:
- Mildew and pest resistance
- Adaption to climate change
- Increased yields
- Reduction in food waste
- Increased photosynthesis
Our expertise
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Whether you are an inventor, investor, start up or corporate landowner looking to develop in AgriTech, our top class multi-disciplinary team can support you.
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