Welcome the 60th Edition of Upstream Ag Professional!
Index:
Precision Spraying
Navigating The Impact of Precision Spraying on the Crop Input Market
AI-Powered Weed-Killing Robots Threaten a $37 Billion Market
Speed of Adoption and Apprehensions
Alternative Systems
See & Spray™ Customers See 59% Average Herbicide Savings in 2024
Deere Potential Revenue
Herbicide Reduction
Pairwise Poised to Revolutionize Agriculture with Industry-Leading Fulcrum™ Platform Following $40M Series C Funding
BASF Set to Announce Ag Solutions Listing Plan in Overhaul
Agrogalaxy faces its darkest hour
When Kansas Drys up… in 2050 with Dan Northrup
CropX Acquires EnGeniousAg for Breakthrough Nitrogen Sensing Technology
Sound Agriculture and Fractal Ag Partnership Expands Efficient Acre Incentive
Learnings from Mr. Beast
Other Interesting Ag Articles (9 this week)
1. Precision Spraying
a. Navigating Precision Spraying Impacts on the Crop Input Market - Upstream Ag Professional
The world is never as straight forward as it seems— first order thinking suggests to us that if John Deere and all precision spraying companies claim a ~60% reduction in herbicide use, that means a 60% drop in total volumes sold.
The reality is that the world is nuanced and changes in one area lead to changes in another, which can mean a change in volumes down (or up!), but it can also mean a change in pricing, margins, solutions offered, rates used and much more. Especially as we consider crop protection beyond just herbicides.
To help navigate this nuance and think about the second and third order implications, I have integrated multiple concepts that are applicable to understanding potential outcomes from precision spraying into one holistic article.
The aim is to help agribusiness professionals think through the opportunity, or risk, to their business— whether you are a retailer, a crop input manufacturer, or an equipment manufacturer, there are frameworks that can help think through the implications of new technology on your business.
With new technology comes the need to re-think traditional systems along with where we stand within the system.
As Alvin Toffler said:
The illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn, and relearn.
To apply this to the inputs space, as precision spray systems proliferate, the groups that can unlearn their current way of thinking or business models and relearn or build one that fits into a new system, will have the highest likelihood of managing margins, gaining a disproportionate share in the market and being successful.
Article Index
Understanding Jevons Paradox
Real World Examples
Energy and Iron
Transportation
Extrapolating to Farming
Yield and Quality as a Primary Revenue Method
Early Examples and Practice Evolution
Herbicide Resistance
Not an Isolated Technology
Second Order Implications
Commoditization of Crop Protection Products
The Jobs-to-be-Done Lens Behind Crop Input Decision Making
Disruption Through Complements
Access to Information
Farmer Apprehensions of Precision Spraying
Final Thoughts
Implications for Input Manufacturers
b. AI-Powered Weed-Killing Robots Threaten a $37 Billion Market - Bloomberg
Key Takeaways
There are multiple apprehensions for precision spray companies to overcome for farmers, including: product need uncertainty, confidence in accurate spraying, value beyond herbicides, and in some instances, business model challenges.
AgZen is a player in the same space with a different take on reducing crop protection application across multiple crop protection segments via their machine imaging product and droplet coating product.
I do not think anything in this article will be new to those working in the industry, however, it does bring up two things in my mind.
What’s holding back precision spraying adoption?
What other precision spraying technology is available?
Speed of Adoption
Nearly four years ago I suggested adoption of Precision Spraying capabilities would be quick. It was a naive assumption that didn’t properly consider equipment upgrade cycles, cost of capital, price of the systems along with how seamless the systems fit into the farmers operations.
Fats forward to today, I remain bullish on the adoption of precision spray technologies, however, the practical realities of the market and adopting on-farm technology continue to arise. In talking with farmers that have used the products and professionals developing in the space, it becomes apparent there remains a need to manage farmer apprehension and evolve features accordingly.
Some of these apprehensions include:
Accuracy and Managing Expectations — Ensuring every weed is hit, including small weeds, remains something in the back of a farmers mind, particularly in North America where a “clean field” is prioritized and a low weed seed bank is deemed important. There is work to do to instil confidence in farmers that all germinated weeds are being hit. Farmers want maximum weed control (North America view).
Uncertainty of Product/Volume Needs — In a broadcast application, a farmer knows how many acres they will spray which allows for the proper amounts of product to fill the sprayer tank with. In a precision application setting, it remains unclear how much product they will need. Will they need to spray 60% of the field? 90%? 30%? That leads to a conundrum of excess product or inefficient filling (both of which minimize savings and ROI). Greeneye for example has built features to curb this concern and we can extrapolate that over time, accurate assessment of product volumes by field can be dialled in.
If we next consider the added complexity in multi-tank systems (John Deere See and Spray Ultimate, Greeneye) because of split tanks where there is a broadcast application and a precision application, it can lead to further complexity.
Primarily Herbicide Savings — Sprayers are used for more than just herbicides. Extending capital for a spray system that only benefits one crop protection segment (albeit important) can lead to a “wait and see” approach by the farmer. Greeneye released “canopy mode” (to only spray on the row) for segments like fungicides and biostimulants to increase savings and John Deere is collaborating with companies like InnerPlant and Syngenta to expand to fungicides.
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