The 2018 Cleantech Forum San Francisco successfully wrapped up two weeks ago, which highlighted next generation cleantech innovations. The agriculture & food sector was a key topic for this year, and as such, was allocated three separate sessions to cover various themes, including digital agriculture, sustainable food systems, and biotechnology applications. The panels consisted of leading venture investors, corporate executives, and entrepreneurs sharing their perspectives on the current challenges we face, and more importantly, how to overcome them.
Digital technologies can improve farming efficiency, but adoption may be slow
There is an influx of new digital technologies for the agriculture & food sector, especially as their associated costs are falling. Farmers today have abundant access to digital technologies to improve their farming process; however, the path to utilization remains a challenge for many. One panelist commented that as much as 80% of the technology that is already installed and embedded in farming equipment is often not being used. Furthermore, there are inherent limitations on what sensors can do, and adding complexity for farmers is not a desirable best practice. Another panelist commented that many farmers view agronomy as an art rather than science, so a data-driven approach can prove difficult to implement.
One disruption that digital technologies bring to the agriculture sector is the effect on crop insurance. Having an insurance policy fundamentally discourages innovations, with insurance payouts providing a safety net for farmers if they do suffer a loss during a given growing season. However, a data-driven approach will provide insurance companies tools to distinguish between externalities (such as severe weather) and erroneous farming processes, and thereby “forcing” farmers to adopt a more scientific-based practice or risk losing insurance benefits.
A sustainable food system requires strategic partners
During our sustainable food system session, the panel unanimously agreed that the agriculture & food sector requires longer term investments, and that investors need to stay committed in order to truly add value to the ecosystem. Meanwhile, corporate strategic partnership is viewed as a critical component to bring new agriculture & food technologies into the market. In addition to financial support, corporate partners add unique value through their access to other parts of the value chain, in areas such as supply chain and supermarkets.
It was also agreed that we currently don’t have a food shortage problem, but a food distribution/access one. It is also why we are seeing the emergence of technologies targeting a localized food system, such as AeroFarms and Finless Foods (participants on this panel). Nevertheless, the panel also recognized that this is not the solution, but just one of many in addressing the food access challenge.
Public adoption is critical for agricultural biotech
The last session focused on biotechnology applications for the agriculture & food sector, and the discussion was geared towards technology commercialization. Similar to the previous session, the panel emphasized that biotech has a much longer development cycle, and that the sector needs to learn from the capital intensity nature of biotech. Likewise, corporate partnership was once again identified as a key attribute in de-risking the technology.
One key hurdle in bringing agricultural biotechnology to the market is public acceptance. The experience with genetically modified organisms (GMOs) has proven that regulatory scrutiny is costly, and that the consumers will ultimately decide if they will purchase a product that is produced using a new biotechnology (such as gene editing).
As part of CTG’s mission in charting the future, we will continue to provide updates on the latest development in the agriculture & food sector. We also invite you to share your perspectives on the future development of this sector at email@example.com.