Combining Agriculture and Technology
The population of the world is expected to increase from 7 billion to 9 billion people by 2050. In addition, diets are improving which will result in double the demand for agricultural crops. John Deere is utilizing technology in its agricultural equipment to combat this problem.
Introduction
There are over 7 billion people in the world and that number is expected to expand to over 9 billion by 2050.[1] All of these people will need to eat which is placing pressures on the agricultural industry to improve crop yields. In addition, as the world economy improves, especially in countries like China and India, diets are improving and increasing “demand for meat, eggs, and dairy, boosting pressure to grow more corn and soybeans to feed more cattle, pigs, and chickens. If these trends continue, the double whammy of population growth and richer diets will require us to roughly double the amount of crops we grow by 2050.”[2] The solution to this problem is farming smarter and increasing resource utilization. John Deere is helping farmers to do this via technology in their agricultural equipment.
Farming Industry in United States
In the United States 97% of farms are family owned and 88% of the farms are considered small.[3] The main crops in the United States and their values are shown in the table below.
| Major Crops in the USA | 1997 (in US$ billions) |
2014 (in US$ billions) |
| Corn | $24.4 | $52.4 |
| Soybeans | $17.7 | $40.3 |
| Wheat | $8.6 | $11.9 |
| Alfalfa | $8.3 | $10.8 |
| Cotton | $6.1 | $5.1 |
| Hay, (Other than Alfalfa) | $5.1 | $8.4 |
| Tobacco | $3.0 | $1.8 |
| Rice | $1.7 | $3.1 |
| Sorghum | $1.4 | $1.7 |
| Barley | $.9 | $.9 |
| Source: 1997 USDA-NASS reports[4] |
Source: 2015 USDA-NASS reports[5] |
New Technology Options
Many farms have been passed down through generations and along with the land, knowledge and operating models have transferred as well. Farmers rely heavily on intuition and experience. In my experience, it can be extremely difficult to convince a farmer to try something new because the risks are just too great.
To increase crop yields John Deere is developing and integrating new technologies into their farming equipment, especially in combines. A combine is a machine that is used to harvest a crop.
Some examples of technology in new combines are:
- Collecting machine data
- John Deere FarmSight utilizes wireless communication via GPS receivers to compile data from machines and fields. This allows farm managers to have clear visibility to the harvest and allows access to remote support with dealers.
- Optimization of harvesting settings
- A combine has over 15,000 parts and a plethora of settings that affect yield and machine utilization. Deere developed an Interactive Combine Adjustment (ICA) which simplifies the process of selecting settings based on the harvest strategy. For example, you can choose to optimize based on grain quality or throughput.
- Syncing equipment in the field
- A combine is only one part of the harvesting process. The crop is harvested by the combine and transferred to a grain cart pulled by a tractor. If these machines are not in sync grain will end up as waste on the ground. Machine Sync connects these machines in the field to align the speeds and unloading time.[6]
These, and many other technological innovations have been integrated into the latest combine models.
Additional Opportunities
While the technological advancements that John Deere is providing in new combines is commendable, there are still further opportunities. The technology is only in new combines and most small to medium sized farms use equipment for a long time before purchasing new equipment. I think Deere should develop technology that can be retrofitted into older machines. It is also extremely difficult to convince farmers to try new technology. Deere can do a better job of educating farmers via trade shows and their dealer network.
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[1] United Nations Department of Economic and Social Affairs. (2016, 11 14). Un.org. Retrieved from http://www.un.org/en/development/desa/news/population/2015-report.html
[2] National Geographic Magazine. (2016, 11 14). The Future of Food. Retrieved from www.nationalgeographic.com: http://www.nationalgeographic.com/foodfeatures/feeding-9-billion/
[3] www.fooddialogues.com. (2016, 11 14). Retrieved from http://www.fooddialogues.com/foodsource/farm-size-and-ownership/what-is-the-average-size-of-an-american-farm
[4] “United States Crop Rankings – 1997 Production Year”. Retrieved 2014-04-01. (n.d.).
[5] “Crop Values – 2014 Summary” (PDF). Retrieved 2015-11-26. (n.d.).
[6] Machine Finder Blog. (2016, 11 14). UTILIZING 2014 S-SERIES COMBINE TECHNOLOGY FOR INTELLIGENT HARVESTING. http://blog.machinefinder.com/18947/utilizing-2014-s-series-combine-technology-intelligent-harvesting.
Very informative article with great pictures! For a long time I considered farming industry as not related to hi-tech and this article has proved me wrong. I think it is a great idea to build in these information and planning tools in combines because it helps to solve the problem that farmers may not have the expertise in optimizing their work and that they may not have access to information from buyers. I’m wondering if John Deere has expansion plan overseas, especially in developing countries. I think at least in Rural China many farmers are still using manpower to farm. It would be great if they could take advantage of these equipments to improve their productivity.
Maria – I enjoyed reading your article! Digital providers in the agricultural industry (such as John Deere) must partner with other agricultural technology innovators (such as Indigo Agriculture) so that both types of technologies can develop together. It would be a shame to see Deere independently come up with new digital harvesting strategies, when scientific companies are working with genomes that may reconfigure the entire landscape. Agriculture strategy is going to be significantly altered these next few years, and I think that companies that come up with digital platforms should ensure their solutions are customizable and compatible with new research and technology that may change, for example, grain composition. It’ll be interesting to see whether these new digital solutions are adaptable to the wave of new biotechnology that will sweep the agricultural industry these next few years.
Thanks for the insightful article Maria! I liked your recommendations and believe that developing more backwards-compatible technologies and educating farmers will be key. To build on this with a slightly different solution: could it make more sense to use the investments in backwards-compatible technologies to incentivize farmers to buy into the newer tractors with promotions? The thing I worry with about investing in backwards-compatible tech is that it reduces incentive for the farmers to ever upgrade, which is what Deere ultimately wants. You could structure a promotion in the form of a trade-in program (a la Apple) to lessen the investment for farmers.
Hi Maria, as you have described, precision agriculture and this wave of AgTech has pushed machines to be more accurate, capable and automated. Could future farming machines displace the role of farmers? Would farms be ultimately operated by robots? The article also mentions farming machines collecting data. Who owns these data? Are farmers protected from potential exploitation of data generated from their farms? I would love to hear some of your thoughts on these issues.
Thanks Maria! This is an interesting topic, and obviously something you know a lot about (sweet combine btw). ^ Vincent, to your point, I can see your concern about delaying the upgrade, but it might make sense to make backwards-compatible tech for Deere machines if the cost of developing the tech isn’t too high, as it can establish really important goodwill between the farmers and Deere, then when their machines’ lives end, they will be certain to use Deere machines going forward. The added benefit is the short-term reduction of waste that Maria mentioned. But this is pure speculation, as I know very little about the industry.
Maria – this was a fascinating article and provides great insight into the crucial role digitisation can play in improving agricultural yield, central to ensuring crop yields increase in line with population growth, as you touched on. What I think is particularly exciting is the role information aggregation can have here: by aggregating real-time national data on seed type, fertiliser use and water consumption, John Deere can play a key role in maximising visibility and therefore efficiency across the supply chain. A great way to monetise this big data would be to create information sharing agreements across said supply chain with the larger suppliers of seeds or fertilisers for instance, inter alia.