Agriculture is big business in the United States. The U.S. Department of Agriculture reports that in 2019, there were 2.02 million U.S. farms and a total of 897 million acres of farmland. That same year, these farms produced $193.3 billion in crop cash sales.
While it’s tempting to think that the American agriculture industry is well-funded and well-staffed, the country’s farmers battle rising costs, shrinking margins and labor shortages like everywhere else. Automation, despite its challenges, offers a viable solution. Many producers have already jumped at the chance to adopt the latest technical innovations. Manufacturers have an opportunity to win big in the marketplace—when they deliver.
At the FIRA Open Day 2021 event, “An Overview of the US Ag Robotics Market” roundtable brought together a panel of experts to dive into the complexities of funding, developing and introducing robotics and other autonomous machines to American farmers. As the moderator, Julie Peyrache, Investment Manager at CAPAGRO, led the discussion. Praveen Penmetsa, CEO of Monarch Tractor, Gabriel Youtsey, CIO at the University of California, Walt Duflock, VP of innovation at Western Growers, and Alain Pincot, Owner of Betteravia Farms shared their varied perspectives.
The market for automation exists, and startups are investing in it
“If you look at the last 60 years, the farm count in the U.S. has dropped by almost 40 percent, and farm size has gone up by over 40 percent, so we have fewer bigger operators than a few decades ago, and it has had a big impact on labor,” Duflock says.
“Specifically, there's two types of farmworkers—hired and family farm workers—and both have had massive decreases in the last 50 years. The overall labor drop is 68 percent across both categories. What's been happening is that larger operators are buying the family farms, and they're not replacing farm workers from the family with hired farm workers. They're replacing them with a lot of automation.”
As a small number of large and specialized farms continue dominate the industry landscape, these figures prove to be particularly attractive to ag robotics companies that want to test their prototypes, solve problems and build customer loyalty in a market where the right machinery can have a profound impact. Developing the right machine, however, often requires manufacturers to overcome a number of uphill battles.
In the category of harvest automation, for example, Duflock says that many efforts are hampered by the investment of money, time, and expertise. Investment funds go fast when the equipment needs to be constructed from the ground up.
“In spite of hundreds of millions of dollars of startup investments and hundreds of startup launches over ten-plus years, building this stuff is hard, and building this stuff takes a long time,” he says. “One of the biggest challenges with harvest is that every crop requires its own robot. What works for apples doesn't work for strawberries and what works for strawberries doesn't work for lemons.”
Farmers eagerly embrace automation when it meets their needs
One way to help mitigate these issues is to focus on collaboration. With the right team of specialists, investors, developers and engineers, the process tends to go more smoothly. It is particularly important that solutions are developed by pairing those who understand technology with those who are knowledgeable about agronomy.
An example Youtsey cited was Blue River Technology, a company that worked with the University of California Davis to develop a weeding solution that was ultimately purchased by John Deere. The tool required what Youtsey calls “uncommon collaborators” to contribute to the common goal.
The University of California is now attempting to replicate this workflow by partnering with Western Growers to identify where technological solutions often suffer from bottlenecks and how a united supply chain can overcome potential problems. It begins with pulling together a wide range of professionals who have expertise in their specific fields.
“We’re really trying to get more pre-competitive alignment between the universities, startups government entities, and the larger established companies to collaborate on things that really can't be done in a vacuum by one small start-up,” Youtsey says. “These things need to be done more systemically across industries. Bringing those uncommon collaborators together is going to be key moving forward, and that's how we're trying to help solve the problem.”
As the resulting ag robotics and technologies become more applicable to farmers by addressing their most pressing needs, adoption rates begin to increase. At Betteravia Farms, Pincot has experienced a return on investment for the autonomous machines he purchased to weed his operation in Santa Maria, California. The labor savings have been a highlight, as workers have been increasingly hard to come by.
“We are replacing crews of 10, 12, 18 people with machines roaming through the field,” says Pincot, who notes that this is his primary focus when adopting autonomous technologies. “What we see right now in terms of automation, however, is that the equipment that is autonomous is not necessarily replacing multiple people. It's a little bit of a concern to our growers that some of those machines just replace a tractor driver.”
“The concept of autonomy is very much used right now,” he adds. “It's almost a buzzword. As growers, we don’t know that ‘autonomy’ as it is presented today is our immediate concern. What we'd love to see in the next five years would be solutions in vegetable harvesting where, right now, everything is done by hand. The target for us is being able to replace entire crews of tired people. That's our number-one priority.”
Companies that overcome data, sustainability and accessibility problems build customer trust
While much of the ag robotics industry’s focus has centered on labor-saving technologies, American farmers are eager for autonomous machines to tackle other problems, too. The continual shift toward greater data security, environmental sustainability and product accessibility are top of mind.
“Just an autonomous tractor is not going to solve the challenges,” Penmetsa says. “What we need to figure out is how to automate operations, whether it's harvesting, planting, cultivating, and all the other operations that happen on the field. With that in mind, there are other challenges that farmers are also facing. There's an increased scrutiny on the farmers from a regulations and compliance standpoint.”
For example, Penmetsa continues, consumers are increasingly conscious about where their food is coming from and how it was made. Major food retailers have also jumped on this bandwagon, eager to please their customers by requiring farmers and producers to follow stringent sustainability, data and food tracing requirements.
“When you add the laborer with the sustainability and the data requirements, you get this trifecta that creates additional effort for the farmer,” Penmetsa says. “Plus, one of the challenges we are also seeing is that the farm economics currently do not support multi-million-dollar machines. This hugely limits how many people can access the technology. Technology has to be accessible and scalable.”
Aware of these issues, manufacturers are finding creative ways to solve problems and build trust. One practice that is becoming more common is to provide full-service support. Not only will companies rent expensive machines, but they will also run the machines, collect and analyze the data, and partner with third-party suppliers when necessary to manage all aspects of the project from start to finish.
This approach can be a welcome reprieve. It saves farmers from having to hire and train highly skilled operators, manage data sets, and work outside their skillsets. Ultimately, American farmers and producers everywhere have the same goal. They want to work smarter and more profitably with less effort. Manufacturers that can serve their customers in this way have the power to master any marketplace.
“Ultimately, I think we're going to need more and more of these robotic solutions out there because farm laborers only getting harder to find and the aging workforce is real,” Duflock says. “Things are getting more expensive, which is going to force farmers to react economically. I'm optimistic because we keep doing more and more with less, and there are players in the field doing the work. They're taking the advantage of the opportunity.”
Duflock highlights Mondavi as a prominent manufacturer that is creating autonomous solutions at scale, while commending the smaller-scale service providers that can assist regional operators. It takes both kinds for the industry to succeed.
“One third of this problem is solved with tech and two-thirds of it is solved by the go-to-market strategy that startups need to implement,” Duflock says. “That’s exactly where things need to go, and I'm excited.”