The growing agtech industry

WHEN there is a big number of startups in a certain industry, that means there is a huge or growing demand for its products and services.

The same can be said now of the agriculture technology or agtech industry that now has thousands of startup companies globally developing and innovating solutions to boost the productivity and incomes of farmers and food growers.

In my column last week (“The need to upscale agtech adoption”), I cited a report from the Mckinsey website (https://www.mckinsey. com/) posted in early 2023 stating that there is a big number of agtech development startups in developed countries with the United States having nearly 3,500, the United Kingdom almost 700 and Canada at least 630 as of 2022. Mckinsey also said that the precision agriculture market in Canada reached $870 million in 2022.

However, those three countries do not have a monopoly of agtech startups based on my research, as there is also a surge of funding for agtech startups in the Asia-Pacific region.

An article posted at www.insidermonkey.com in November last year showed that China also has 660 startups and Australia has 863 in the agtech industry. The website also showed updated figures for startups in Canada numbering 1,143, the UK with 1,224 and the US with 6,319.

Also, an article posted in AgFundernews (https://agfundernews.com/) titled “Data snapshot: Ag Biotechnology investment surges in Asia-Pacific as funding swims upstream” stated that investment in agriculture biotechnology (ag biotechnology) increased from $142 million in 2021 to $813 million in 2022.

Agfundernews said this makes agtech biotechnology the top-funded upstream category in 2022.

China led the region for ag biotechnology funding in 2022 with $633 million and India followed with $122 million. Funding for ag biotechnology startups were also recorded in Japan ($20 million), New Zealand ($14 million) and Hong Kong ($13 million).

AgFunder said that in the first half of last year, startups in ag biotechnology raised more than $340 million in funding. It also said that ag biotechnology funding increased in the Asia-Pacific because of the region’s vulnerability or susceptibility to the effects of climate change and food insecurity.

While I do not see the Philippines joining the top 10 or 20 list of countries with agtech startups, I encourage Filipinos capable of developing technological solutions to level up farm and fishery production to venture into the agtech industry.

I also believe that state universities and colleges have the capability to contribute to the development of agtech in the country, and should be provided more government funding for that endeavor.

Looking back at COP28

What I see in the next 10 years is a dramatic increase in the number of agtech companies because of the need to develop and commercialize solutions to make the global food system more productive and resilient in the face of an increasing worldwide population and the pronounced effects of climate change.

The need to make the global food system more productive and resilient was amplified during the 28th Conference of the Parties of the UNFCCC or COP28 held in Dubai from November 30 to December 13 last year. And I will not be surprised that a big number of agtech companies closely watched the COP28 proceedings and are studying its outputs.

One of the declarations made at the conclusion of COP28 is the need to scale up the adaptation of activities and responses to reduce the vulnerability of farmers, fisherfolk and food producers to the impacts of climate change or extreme weather conditions. And this should include, especially in the Philippine setting, scaling up of agtech by smallholder farmers and fisherfolk, small and medium agribusiness firms, and local government units that have agricultural enclaves vulnerable to weather changes.

And from what I see in the development of the global agtech industry, I strongly believe that there are numerous technological solutions and innovations that can be introduced and upscaled immediately in the Philippines.

From my column last week, let me enumerate again the current and emerging agtech trends: farmmanagement software; remotesensing and precision agriculture; drones or unmanned aerial vehicles; autonomous farm equipment; regenerative agriculture; and biotechnology.

All of the agtech I enumerated are definitely needed in the Philippines to make the country’s agriculture sector more productive and resilient. Of greater importance in scaling up agtech in the country is to increase the incomes of agricultural producers as this will not only improve their lives — this will also allow them continuously adopt agtech, especially if there is a rapid improvement of technologies in that field.

And with the advent of digitalization and artificial intelligence, much of the agtech that we see now will have dramatic improvements in the next five or 10 years.

So, to boost local agricultural productivity and incomes, and attain a higher level of food security, we should make sure we are not left behind in agtech adoption. The term agtech should also not sound alien to us.