During the last decade, we have seen great advancements in agricultural technologies. Genetically improved seeds, drone aerial photography or smart sensors are helping an increasing number of farmers with their daily tasks. As part of our mission to map the emerging economy we wanted to understand how agricultural production is incorporating new technologies, so we built an RTIC to understand the state of the industry better. Our RTIC captured 520 companies in the UK, showing a well established sector. In this post, we will go through some key insights and discuss why AgriTech is key for circular economies.
Learn more about how our RTICs work.
AgriTech’s industry verticals.
We have approached AgriTech following technology verticals. The result is a simplified view of the sector relevant for experts and non-experts.
- Automation: here we target companies providing automation and robotics for agricultural processes. We found 204 companies.
- BioTech: these companies apply biotechnology knowledge or instruments to the improvement of agricultural products. We captured 166 companies.
- Management Platforms: this group addresses companies providing software technology to improve the administration of farms. We identified 99 companies.
- Net Zero: in this category we have grouped companies providing technologies exclusively directed to lowering the environmental impact of agriculture. We found 87 of this kind of companies.
- Remote Sensing: this taxonomy group captures the companies providing remote sensing technologies. There were 95 companies of this kind.
A relational view of AgriTech
Since supply chains are not linear anymore, we like to investigate the relationships among verticals. We have prepared a chord diagram that visualises them.
The diagram represents the relationships by counting and grouping the companies present in more than one category. It is interesting to see that Automation and Management Platforms, Net Zero and BioTech and Management Platforms and Remote Sensing build the three strongest links. This makes sense from an end-product perspective: automation and remote sensing technologies need software to manage the produced data, while plenty of environmentally friendly alternatives for agricultural products such as fertilisers were developed thanks to biotech knowledge. Therefore, we can see that there is an interdependency among the industry verticals to provide working improvements to farmers.
The growth of AgriTech
The application of new technologies to agriculture is a recent process. For this reason, we want to provide more detail and show the growth of the industry as a whole and by verticals.
This line chart shows that all industry verticals have had a very similar progression during the last 20 years. This finding relates to the idea of interdependency: it shows that end user products need the integration of different kinds of tech. For this reason, looking into the development of the industry as a whole is more representative of the overall adoption of agricultural technologies. Remarkably, the industry as a whole grew at a rate of 229% since 2000, suggesting a steady path towards the modernisation of agricultural practice.
Our platform estimates AgriTech to be worth £5.2bn by the end of 2020, and counted almost 60,000 employees. However, each taxonomy group participates differently to the overall net worth of the industry. We have prepared a violin chart to view this case.
The largest sectors, Automation and BioTech, captured the companies with higher net worth value. This is due to companies like Teledyne Flir, a large automation company offering products to a variety of industries; or Bayer, a key developer of crop science. This suggests that the verticals developing technological and biotech products that can be implemented in a variety of end-user products produce the highest net worth for the sector.
The role of AgriTech in the circular economy
AgriTech is relevant for circular economies as far as it is key for lowering society’s environmental footprint. Something interesting we have noted is the increase of companies involved in vertical farming. Vertical farming addresses food supply in cities with no agricultural land by growing crops in-doors and in vertical layers, often suspending the roots in nutrient-rich water. This means that food can be produced without the need of extensive arable land, providing urban areas with alternatives to food import. In our RTIC, we captured 70 companies involved in the installation of vertical farms. Besides, recycling waste agricultural product is key for working circular economies. We found 214 companies in this space, providing biotechnology solutions to waste recycling or waste-to-energy technology.
Wrapping up AgriTech
Agriculture is key for the maintenance and development of populations. Therefore, we think it is crucial to understand the technological developments driving the changes in agricultural practice. We found that AgriTech is not only important for the improved efficiency of traditional farming methods, but instrumental for circular economies. Therefore, we highlight the importance of AgriTech to meeting net zero targets and make our food consumption greener. For this reason, we believe AgriTech should be at the centre of planning for a net zero future.