The voice of the farmer will have added resonance after years of venture capital dominance. Agribusinesses have an opportunity to design solutions that optimize farm operations, support sustainable farming and build solutions that better serve growers’ needs.

Use digital to enable, not replace, core services

As venture capitalists increasingly reduce investment, farmers will rely on established companies to support innovation and develop useful digital tools. So, how can businesses ensure that they are developing tools that farmers will want to adopt in 2024 and beyond?

Companies should focus on developing solutions with farmers’ needs in mind. By shifting their perspective and building solutions for specific scenarios—such as equipping farmers with advanced insights to predict machine maintenance or helping them save money on insurance premiums—agribusinesses can create beneficial, must-have solutions for farmers.

Agribusinesses can continue to foster profitable innovation by using digital technology to enable farmers to better execute their core services. Digital innovation should not radically change or replace those core services. Seed companies will stay seed companies, for instance, and the digital revolution will not change that. Instead, digital tools should enable those seed companies to be a more impactful, efficient and agile version of themselves.

How does digital enable farmers? It equips them with the tools that they need to do more with their time: to streamline processes, crunch numbers, generate forecasts and reduce time spent completing paperwork or supply orders. By investing in digital tools that enable and empower, agribusinesses can help farmers expect a strong ROI on their core business.

Equip farmers with insights that empower data-driven decision-making

Though weather always impacts farming, El Niño—a climate phase in which warmer-than-average Pacific Ocean temperatures influence global weather patterns—presents enhanced challenges. This round of El Niño will likely continue into 2024, presenting either drought or flooding conditions around the world: parts of central and southern Africa, southern Asia, Indonesia and Australia will be excessively dry, while wetter-than-usual patterns will primarily impact areas of North and South America, Central Asia and the Horn of Africa.

Farmers cannot control the weather, but they can equip themselves with knowledge from data-driven insights. Data and insights will only become more critical in 2024, as they empower farmers to navigate ongoing challenges like El Niño.

Tools like precision agriculture platforms will continue to evolve as farmers leverage data analytics, artificial intelligence (AI) and machine learning to offer actionable insights. These tools will enable farmers to optimize resource allocation, make informed decisions about planting and harvesting and monitor crop health in real time.

Mobile applications and cloud-based software will also make farms more productive by automating certain tasks. These tools will provide farmers will real-time access to market prices and weather forecasts, enabling them to make data-driven decisions and increase profitability. Financial technology solutions will also help farmers access loans, insurance and other services more efficiently to support their financial well-being in times of uncertainty.

Harness AI to increase efficiency

Though the advent of generative AI may draw some venture capital investment back to agriculture, established agribusinesses nonetheless have an opportunity in 2024 to develop new solutions.

Growers will have the opportunity to use generative AI in a number of ways—ranging from crop management and reducing on-farm food waste to logistics—to enhance smart farming and make their lives easier. For example, AI algorithms can optimize irrigation and fertilizer schedules, thereby automating the process and optimizing efficiency. Drones equipped with AI-powered cameras can monitor crop health and detect early signs of disease. In logistics, AI algorithms can enhance transportation routes, reducing fuel consumption and carbon emissions. Additionally, generative AI can assist in managing risks associated with weather events and market volatility.

By leveraging the power of generative AI, the agriculture industry will experience increased productivity and reduced costs to maximize business outcomes.

Make supply chains efficient

The global supply chain crisis has spared no one, and that includes the agriculture sector. Indeed, the agriculture supply chain has been stretched on both supply and demand sides, as farmers scramble to get inputs and machinery and a growing global population accelerates demand for food products. Moreover, extreme weather events have impacted yields and the food supply. In Australia, for example, increasingly dry conditions impact what farmers there can produce and export.

Companies can unleash the power of digital to bolster supply chains and optimize assets to support farmers. Blockchain technology will play an increasingly crucial role in enhancing traceability and transparency. Furthermore, supply chain optimization will be facilitated through the integration of sensors, which monitor factors such as temperature, humidity and transportation conditions. These sensors provide real-time data, enabling proactive decision-making and minimizing spoilage and waste. Additionally, predictive analytics algorithms can forecast demand, enabling more efficient inventory management and distribution.

By employing these tools, the agriculture sector can build robust, resilient and efficient supply chains that promote both quality and reliability for farmers and demand-side customers alike.

Meet customer expectations regarding sustainability—but at the right price point

An estimated 65 percent of consumers want access to sustainable sources of food, which includes, but is not limited to, organic and ethically grown produce, eggs and meat. At the same time, price volatility—exacerbated by high inflation and unstable supply chains—has strained demand-side customers’ wallets and farmers’ bottom lines. Prices in the United Kingdom, for example, grew 19 percent in April 2023. High prices have occurred just as farmers' dollar share of yields has hit historic lows in recent years.

Though prices are easing, the last several years have taught an important lesson: Sustainable food options must also be commercially viable to support both growers and customers. How can digital solutions promote sustainable food at the right price point?

Farmers and organizations can use digital platforms and tools to connect directly with customers, thereby saving costs in the value chain. This will put money back into farmers’ pockets and equip them with savings that they can then pass on to customers, who would avoid paying marked-up prices in grocery stores. Growers can also rely on real-time data and insights to help them refine operations and reduce waste so that they can maximize yields. In the U.S., such direct-to-consumer sales generated $9 billion, and that number will likely grow as customers increasingly seek out local and sustainable food options.

Additionally, in-store digital solutions may include real-time price monitoring and adjustments that alert customers to the availability of surplus food, rewards programs to receive discounts on sustainable food and QR codes that provide insights into food provenance.

Ultimately, digital solutions can help agribusinesses and growers ensure that sustainability is not only a lifestyle—it is a way of making food both profitable and affordable.