AgriTech as Exciting a Technology as AI and Driverless Cars

AgriTech as Exciting a Technology as AI and Driverless Cars

Mike Fox, head of sustainable investments at Royal London Asset Management has called for investors to realise the potential of Agritech that is ‘simple, practical and works with (sic.), rather than against, the natural environment. AI, machine learning, driverless cars and hyperloop infrastructure that could catapult us from London to Edinburgh in 45 minutes is the kind of ‘sexy’ technology that gets investors excited. However, Fox believes that the latest technology in agriculture that will feed the burgeoning populations of Africa and Asia warrants just as much attention.

Not only is AgriTech that will feed the urban populations of the developing world a necessity it also presents a powerful commercial case. In the 33 years since 1985, the world’s population has doubled to 7.6 billion. 4 billion of those people live in an urban setting and both population growth and urbanisation is being driven by Asia and Africa. 49% and 40% of Asia and Africa’s respective populations are now urban.

The fact that more people live at a distance from where food is actually produced makes efficiency in agricultural logistics increasingly crucial. Transport, storage and wastage issues require more effective use of data and technology. Some of these will be enterprise solutions involving the latest technology in the world of AI and machine learning. Others are small, localised tech solutions. Fox highlights iCow, an app that helps developing world farmers manage their herds and flocks more effectively through SMS messages.

Biotech will play a crucial role in boosting crop yields but not through environmentally damaging chemicals. Agriculture directly leads to £2.2 trillion worth of agricultural damage every year from water depletion and contamination, soil erosion and chemical footprint. New technology used needs to be organic. It also needs to be affordable for small-scale farmers in the developing world.

One of the major biotech developments in this direction is the production of natural enzymes and adjuvants which work like malaria vaccines used by humans. They help crops fight off diseases and infections, accelerating crop growth and yield. Applying these new biotech organic chemicals also needs to be affordable and efficient. New precision tractors are being developed which are able to more efficiently seed, distribute fertilisers and organic growing aids as well as harvest.

High-yield, efficient, affordable and economically sustainable farming focused on the developing world is at least as crucial an application of the latest technology in the world as transport and other innovations that focus on the economically developed world population. And with 3 out of 4 new human arrivals on planet Earth born into the developing world, from an investment point of view, it also makes more than a little sense. As Fox notes, currently small, innovative players in this market are already starting to be snapped up by larger corporations.

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