All eyes have been on the U.S. since Donald Trump won the election last November. So far, outcomes have been mixed: on one hand, the Dow Jones Index has witnessed a historical surge since his election win, rising from just below 18,000 to above 21,000. The U.S. Dollar Index has seen similar benefits, strengthening from just below 97 to nearly 102 in early April. While these factors play along with Trump’s campaign slogan to “Make America Great Again,” not all policy changes were welcomed and many have seen substantial criticism. Continue reading
Feeding the expected 9 billion global population has been an issue of attention over the last few years. Even more concerning is the feasibility of feeding those people while the rate of yield growth in major agricultural crops is decreasing. It seems impossible to squeeze any more yield per acre out of major agricultural crops. For any commercial crop, actual agricultural yields observed today are lower than the crop’s theoretical maximum yield, its genetic “glass ceiling.” The following figure illustrates this concept, where theoretical yield is constrained by an upper bound, and actual yield increases as it approaches the boundary.
For millennia, agriculture has relied on extensive and often back-breaking human labor. Despite numerous productivity-boosting technological advances, labor is still a major part of farming, accounting typically for 10% to 15% of production costs on U.S. farms, and leaving growers vulnerable to labor shortages. Now, however, precision agriculture – a diverse set of tools, techniques, and technologies used to increase the efficiency of agriculture, either by minimizing required inputs or by maximizing yields – is driving activity in robots and automation for agriculture.
The most significant drivers of robot adoption today are limited labor availability, regulatory pressures, and the increased accuracy and precision that robotic solutions can provide. For now, cost remains the most significant barrier to adoption, and few developers offer solutions that are compelling today. Going forward, however, improving technology and rising labor costs are going to bring many more solutions to viability within the next 15 years, and in some cases sooner, as shown above for lettuce growing in Europe.
The field of developers is still highly fragmented and immature. But as solutions become more and more competitive the market opportunity will grow – and the field is likely to consolidate. Companies should look hard at the landscape to see where their capabilities may fit, and consider the strategic opportunities to become a dominant player in agricultural robotics – as well as the threats these solutions may ultimately present to agricultural equipment incumbents.
By: Sara Olson