Digital Infrastructure in the New Decade
For the last 20 years, the agricultural industry has pressed for the widespread development of rural telecommunications infrastructure. While the East Coast, West Coast, and central-U.S. cities brace for 5G, many rural environments would take almost any “G” just to experience the benefits of faster network speed and the associated benefits.
Now, with more consolidation in the telecom space, advancements in hardline and wireless networks, and public demand, a new generation of technology will reach agricultural production hubs.
Today, we discuss why the time is right for independent farmers and co-operatives to use their existing market power as early adopters in technology platforms that provide them the power and flexibility to reshape their local supply chains before other upstream participants attempt to impose their power on transportation, origination, and communication.
There’s no shortage of articles in Fortune and other publications assuring farmers that 5G networks will “unleash” the power of agriculture or “revolutionize” supply chains, or make farming “Smarter.” Such promises and hypotheses were established at the onset of 4G. And after years of deployment of that technology, some farmers still didn’t even have access to basic internet service.
The Market Pitch:
Naturally, large agricultural manufacturers are optimistic about the promise of 5G and rural broadband expansion. John Deere’s Director of Intelligence Solutions has touted a future of “Smart farming” that includes technologies like machine learning, artificial intelligence, precision monitoring, and more. Such technological advancements would provide greater yields, improved irrigation practices, and a reduced need for manual labor.
The Market Reality:
For years, in many agricultural areas, farmers and other members of their supply chains were limited to one or two wireless providers. And, prices were high and service was unreliable. It wasn’t just farms that faced these challenges. Schools, hospitals, and other important community pillars lacked access to reliable, fast internet. While the government at the state and federal level had promised billions to roll out advanced wireless and fiber-optic networks, wireless companies have largely failed to deploy these services to areas in need.
Despite such proposed advancements in the future, the hype largely ignores that basic harvest logistics comes down to one thing and one thing only: Communication among parties. While 5G and the Internet of things might let the combine know where the semi is, it doesn’t address the lack of transparency in other areas of the supply chain. Most technology enthusiasts are substituting one communication problem for another.
What We’re Hearing:
Large manufacturers and institutional proponents of advanced wireless technologies will benefit from this next wave of innovation. But these companies are approaching the supply chain with their own self-interest in mind and attempting to press adoption of this new technology without addressing the fundamental and variable challenges experienced by participants in the supply chain.
Meanwhile, co-ops and elevators argue that transparency remains critical for their operations. If they do not know that a farmer is planning to drop off several loads of grain, they will not remain open or allocate staff to ensure time to unload. Communication (or the lack of communication) remains a significant factor that has made on-farm storage a necessity for many large producers.
Farmers want to optimize their local supply chains without the influence of large agricultural companies that are attempting to sell a brand new feature or function. Instead, farmers can rebuild and restructure their own personal supply chains and utilize their combined market power to drive new efficiencies up the larger industry chains. This starts with transparency, communication, and visibility among participants in the First Mile of today’s value chain.
On-farm storage has increased in-line with production over the last two decades. However, we must drill down into local supply chains and farm-by-farm microanalysis to personalize and streamline individual operations and maximize efficiency. By increasing local efficiency and leveraging technology, the broader agricultural supply chain and industry will benefit and deliver incremental, mutual gains.