How agri-tech startups are strengthening supply chain
The agri-tech startups in India are playing a vital role in the agriculture supply chain with the help of the latest technologies such as Artificial Intelligence (AI) and Machine Learning (ML) and investments from international investors. Agritech startups are currently operating in B2B, B2B2C, B2C and export markets. They are primarily contributing to the supply chains of agri-inputs, dairy, poultry, the development of agri-commodity value chains, establishing the supply chain ecosystems for horticulture produce and providing quality-driven trade transactions across the food value chains. Considering the current growth of agri-tech startups in the supply chain, startups will expand their reach in the international market by 2025.
The lockdowns due to the COVID-19 and the uncertainties and a shutdown of the age-old business module paved the way for online mandis and a host of e-commerce platters at every level. Agri-tech startups are swiftly shaping the agriculture supply chain for a tech-led more progressive future. There is a whole new paradigm shift from traditional and analogue markets to highly interactive, and innovative online marketplaces.
According to Thinkag’s ‘Ag-tech in India: Investment Landscape Report 2021’, digitalisation and optimisation of India’s numerous and fragmented supply chains continue to dominate India’s Ag-tech landscape, accounting for 85 per cent of the total investment and two-thirds of first-time deals in 2020. There are also a growing variety of models in the sub-sector, particularly agribusiness marketplaces for output in addition to consumer-proximate ones and emergence of novel solutions for allied sector (dairy, poultry etc.) supply chains. India’s agri-tech startups received $136.46 million in funding in 2020, compared to $244.6 million in 2019. Many agri-tech startups are expanding their reach at international and domestic markets by raising
funds from major investors such as Omnivore, Ankur Capital, Nabventures, Kalaari Capital, etc.
Investment in agri-tech startups
Recently, agri-tech startup Agnext Technologies has raised a total of $21 million in Series A funding. The round was led by Alpha Wave Incubation (AWI) fund. With this new capital infusion, Agnext will now enter newer commodities, strengthen its pan-india presence and expand to international markets such as the Middle East, Europe, and South Asia. The funds will also be used for the development of its tech platform Qualix, to enable quality-driven trade transactions across the food value chains.
Agri-tech startup Vegrow has raised $13 million from investors including Lightspeed Venture Partners and Elevation Capital to invest in technology, new products and expansion in
100 cities. It is a B2B platform for fruits and vegetables. Vegrow has scaled rapidly among both farmers and B2B customers, resulting in nearly 20 times top-line growth with a presence in over 30 cities. Vegrow technology platform powers everything from farm discovery, produce quality profiling, and market intelligence to smart matchmaking between farm-level inventory and customer requirements.
Chennai-based agri-tech startup Waycool Foods has recently announced that it will be investing $5 million in Siddhi Vinayak Agri Processing (SV Agri), one of India’s largest fully integrated players in the potato supply chain ecosystem. Waycool Foods is India’s largest and fastest-growing agri-commerce company focussed on food development and distribution. The current investment will allow both Waycool and SV Agri to leverage their strong supply chain ecosystems and boost the quality and supply of potato seed, storage and processing across India. Waycool has also announced an aggressive growth plan entailing over $100 million investment in technology, product development, facility expansion and new company acquisitions over the next four years.
Hyper-fragmentation in Indian agriculture, the need for locally specific solutions and the plug and play nature of some high-tech solutions are some of the driving factors behind Indian agri-tech startups chosen paths to scale. Startups are playing a vital role in the logistics of the agricommodities.
New logistics services
The agri-tech B2B marketplace Bijak that connects sellers and buyers PAN India has launched logistics services in Maharashtra and Uttar Pradesh with an aim to provide easy trading of commodities across the country.
The agri-traders of these states can avail of this service directly through the Bijak application for interstate and intrastate trading. The service ensures affordable and timely dispatch of the commodities. With the launch of its new service, Bijak aims to target 25,000 traders in Uttar Pradesh and Maharashtra. Bijak is currently present in 27 states and 916 regions and trades over 110 commodities through its platform. The motive of Bijak is to bring flexibility, convenience, cost-effectiveness and market linkages to all sellers and buyers in the agri supply chain. Aligning to the company’s vision, Bijak has taken a step forward to facilitate transparent trading and offer services such as credit, payments/ escrow, and logistics.
In order to reduce the carbon footprint of its logistics operations and achieve sustainable growth, Vegease, the cart-at-home e-grocery startup has begun to deploy Electric Vehicles
(EV) in its last-mile logistics. The company has just completed an initial pilot in August 2021 and will move completely to an electric fleet by 2024. Towards achieving this, Vegease has partnered with electric vehicle OEM, OBA for their threewheeler evikas light commercial vehicles under a long term leasing model. The move will contribute to an operating cost reduction of 25 per cent. Vegease will add three-wheeler loaders with Li-ion battery which have a load capacity of 300 kgs.
According to Anand Chandra, Co-founder, Arya Collateral, “Agri-techs are already playing a crucial role in strengthening distribution channels and digitising the value chains. Emerging technologies can be a game-changer in building a strong logistics foundation to enhance traceability and ensure proper mapping of supply with demand. With improved logistics and distribution channels we can help farmers in India access markets and consumers anywhere across the world with home-grown produce while promoting ethnic food chains. Tech can also play a role in the standardisation of the grades of commodities which will make markets more vibrant."
“Agri-techs are already playing a crucial role in strengthening distribution channels and digitising the value chains. Emerging technologies can be a game-changer in building a strong logistics foundation to enhance traceability and ensure proper mapping of supply with demand. With improved logistics and distribution channels we can help farmers in India access markets and consumers anywhere across the world with home-grown produce while promoting ethnic food chains. Tech can also play a role in the standardisation of the grades of commodities which will make markets more vibrant."
- Anand Chandra, Co-founder, Arya Collateral
“As the pandemic gave birth to new beginnings, the agri-tech industry too got its share fully loaded with ground-breaking firsts. The use of AI and IOT emerged as perfect solutions to worst-hit segments like logistics and supply chain management. Enterprising agri-tech companies responded promptly and embraced innovative ways to support and empower farmers to safeguard crops and harvest from total loss. In return, agri economy breathed a new life and also gave farmers the much-needed confidence.”
- Arpit Katta, CMO & Co-founder, Vegease
Artificial Intelligence (AI) powered Internet of Things (Iot)-software as a service (Saas) platforms have become the buzzword in capturing real-time data on growing conditions from on-farm sensors and delivers farm-specific, crop-specific actionable advisories to farmers via mobile in vernacular languages. agri-tech startups in the supply chain are making a difference by promoting digital platforms.
Digitising supply chain
In recent agri-tech startup Agribazaar partnered with the Government of India to build and promote the Digital Agriculture Platform (DAP). Narendra Singh Tomar, Union Minister for Agriculture, Amit Mundawala, MD & Cofounder, Agribazaar signed an MOU to launch the initiative.
DAP will enable and empower the Indian farmer to approach farming in an integrated manner, with a single source enabling agritech platform. As a part of this collaboration, Agribazaar will leverage its technological capabilities to create standardised, verified data for Agristack, profile agricultural land, develop a generalised advisory platform, enable access to an integrated farmer marketplace for the broader stakeholder ecosystem and facilitate better access to financial services for farmers.
The Union Ministry of Agriculture will provide sourcing assistance, resources, information, data sets and cooperation from local authorities/ state governments/government institutions. The initiative will play a vital role in supporting the farming ecosystem by maximising productivity and contributing to double farmer income by 2022.
The agri-tech startups in India are playing a vital role in the agriculture supply chain with the help of the latest technologies such as ML and AI and investments from international investors. Agri-tech startups are currently operating in
B2B, B2B2C, B2C and export markets. They are primarily contributing to the supply chains of agri-inputs, dairy, poultry, the development of agri-commodity value chains, establishing supply chain ecosystems for horticulture produce and providing quality-driven trade transactions across the food value chains. Considering the current growth of agri-tech startups in the supply chain, startups will expand their reach in the international market by 2025.
Speaking on the role of startups during the pandemic, Arpit Katta, CMO & Co-founder, Vegease said, “As the pandemic gave birth to new beginnings, the agri-tech industry too got its share fully loaded with ground-breaking firsts. Among a host of them, one initiative is standing head and shoulders above the rest. The use of AI and IOT emerged as perfect solutions to worsthit segments like logistics and supply chain management. The traditional distribution system collapsed and technically it was totally incapable of adapting to the new normal. Enterprising agri-tech companies responded promptly and embraced innovative ways to support and empower farmers to safeguard crops and harvest from total loss. In return, agri economy breathed a new life and also gave farmers the muchneeded confidence.”