McKinsey: Agriculture’s digital transformation
Agriculture looks poised for a digital transformation which could yield $500 billion to global gross domestic product by 2030, reports McKinsey & Company.
According to the consultation paper, farming remains the least digitised industry in the world – despite the global population - which will need feeding – expected to grow to 9.7 billion by 2050.
The McKinsey & Company report, Agriculture’s connected future: How technology can yield new growth, embracing digital technology, points out technology currently used in agriculture tends to be for mechanical and genetic purposes.
“Now much more sophisticated, digital tools are needed to deliver the next productivity leap,” highlights the report.
“Agriculture is in the early days of yet another revolution, at the heart of which lie data and connectivity. Artificial intelligence (AI), 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.”
Future of connectivity
Over the next decade, existing technologies like fibre, 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.
“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 our research. This would amount to a seven to nine percent improvement from its expected total and would alleviate much of the present pressure on farmers,” commented McKinsey.
By 2030, McKinsey & Company predict an advanced connectivity infrastructure will cover about 80% of the world’s rural areas (exception is Africa).
As connectivity increasingly takes hold, the report outlines that these tools will enable new capabilities in agriculture and pave the way for a digital transformation:
Massive Internet of Things (IoT).
Low-power networks and cheaper sensors will set the stage for the IoT to scale up for; precision irrigation of field crops, monitoring of large herds of livestock and tracking the performance of remote buildings and large fleets of machinery.
Ultra low latency and improved stability of connections will foster confidence to run applications that demand absolute reliability and responsiveness, such as operating autonomous machinery and drones.
If LEO satellites attain their potential, they will enable even the most remote rural areas of the world to use extensive digitisation, which will enhance global farming productivity.
“Potential value initially will accrue to large farms that have more investing power and better incentives to digitise,” commented the McKinsey & Company report.
“Connectivity promises easier surveying of large tracts, and the fixed costs of developing IoT solutions are more easily offset in large production facilities than on small family farms. Connectivity enables more use cases in these sectors than in meat and dairy, because of the large average size of farms, relatively higher player consolidation, and better applicability of connected technologies, as IoT networks are especially adapted to static monitoring of many variables.”
Five use cases of connectivity
- Crop monitoring
Connectivity offers a variety of ways to improve the observation and care of crops. Integrating weather data, irrigation, nutrient, and other systems could improve resource use and boost yields by more accurately identifying and predicting deficiencies.
Smart monitoring could also help farmers optimise the harvesting window which could help farmers maximise the revenue from their crops.
- Livestock monitoring
Preventing disease outbreaks and spotting animals in distress are critical in large-scale livestock management, where most animals are raised in close quarters on a regimen that ensures they move easily through a highly automated processing system. Chips and body sensors that measure temperature, pulse and blood pressure, could detect illnesses early, preventing herd infection and improving food quality.
- 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, many of whom are already using such systems from companies like Blue Level Technologies.
- Farming by drone
The next generation of drones is starting to impact the sector, with the ability to survey crops and herds over vast areas quickly and efficiently. Drones also could use computer vision to analyse field conditions and deliver precise interventions like fertilisers and pesticides where crops most need them. Or they could plant seed in remote locations, lowering equipment and workforce costs. By reducing costs and improving yields, the use of drones could generate between $85 billion and $115 billion in value.
- Autonomous farming machinery
More 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
“Still, much of this cannot happen until many rural areas get access to a high-speed broadband network. We envision three principal ways the necessary investment could take place to make this a reality:
- Telco-driven deployment - telcos could benefit from a sharp increase in rural demand for their bandwidth
- Provider-driven deployment - input providers could partner with telcos or LPWAN to develop rural connectivity networks
- Farmer-driven deployment - Farm owners, alone or in tandem with LPWAN groups or telcos, could also drive investment and retain more control over data
“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,” concludes the report.
Intelliwave SiteSense boosts APTIM material tracking
“We’ve been engaged with the APTIM team since early 2019 providing SiteSense, our mobile construction SaaS solution, for their maintenance and construction projects, allowing them to track materials and equipment, and manage inventory.
We have been working with the APTIM team to standardize material tracking processes and procedures, ultimately with the goal of reducing the amount of time spent looking for materials. Industry studies show that better management of materials can lead to a 16% increase in craft labour productivity.
Everyone knows construction is one of the oldest industries but it’s one of the least tech driven comparatively. About 95% of Engineering and Construction data captured goes unused, 13% of working hours are spent looking for data and around 30% of companies have applications that don’t integrate.
With APTIM, we’re looking at early risk detection, through predictive analysis and forecasting of material constraints, integrating with the ecosystem of software platforms and reporting on real-time data with a ‘field-first’ focus – through initiatives like the Digital Foreman. The APTIM team has seen great wins in the field, utilising bar-code technology, to check in thousands of material items quickly compared to manual methods.
There are three key areas when it comes to successful Materials Management in the software sector – culture, technology, and vendor engagement.
Given the state of world affairs, access to data needs to be off site via the cloud to support remote working conditions, providing a ‘single source of truth’ accessed by many parties; the tech sector is always growing, so companies need faster and more reliable access to this cloud data; digital supply chain initiatives engage vendors a lot earlier in the process to drive collaboration and to engage with their clients, which gives more assurance as there is more emphasis on automating data capture.
It’s been a challenging period with the pandemic, particularly for the supply chain. Look what happened in the Suez Canal – things can suddenly impact material costs and availability, and you really have to be more efficient to survive and succeed. Virtual system access can solve some issues and you need to look at data access in a wider net.
Solving problems comes down to better visibility, and proactively solving issues with vendors and enabling construction teams to execute their work. The biggest cause of delays is not being able to provide teams with what they need.
On average 2% of materials are lost or re-ordered, which only factors in the material cost, what is not captured is the duplicated effort of procurement, vendor and shipping costs, all of which have an environmental impact.
As things start to stabilise, APTIM continues to utilize SiteSense to boost efficiencies and solve productivity issues proactively. Integrating with 3D/4D modelling is just the precipice of what we can do. Access to data can help you firm up bids to win work, to make better cost estimates, and AI and ML are the next phase, providing an eco-system of tools.
A key focus for Intelliwave and APTIM is to increase the availability of data, whether it’s creating a data warehouse for visualisations or increasing integrations to provide additional value. We want to move to a more of an enterprise usage phase – up to now it’s been project based – so more people can access data in real time.