Global Digital Farming Market Gaining Momentum—Projected to Reach USD 10,702.3 Million by 2027
Published | April 2021
A study recently conducted by the strategic
consulting and market research firm, BlueWeave Consulting revealed that the global digital farming market was
worth USD 4,770.8 million in 2020 and is
further projected to reach USD 10,702.3 million by 2027, at a CAGR of 12.7% during the forecast period (2021-2027). Factors
driving the market include increased food demand due to population growth, increasing
usage of VRT (Variable Rate Technology), and the growing prevalence of remote
sensing technology, as well as guidance technologies by global farmers. Additionally,
significant cost savings achieved through the implementation of modern agricultural techniques is another factor driving the market growth.
Substantial Cost Savings were achieved
by the implementation of modern techniques to drive the global digital farming
market during the forecast period
Farming
is a cost-intensive process. From seeds to soil preparation to fertilizers to
pesticides and crop cutting, farming requires a lot of investment. Fertilizers
and pesticides consume a substantial portion of farm investment. Fertilizer
spending in the United States rose from USD 8.6 billion to USD 23.5 billion
between 1985 and 2016.The ERS (Economic Research Services) by USDA conducted
research and concluded that farmers using yield mapping individually or in
collaboration with VRT (variable-rate technology) can save USD 25 per acre,
while farmers who use GPS with soil mapping can save up to USD 13 per acre. VRT
combined with yield mapping has the potential to save USD 22 per acre. The ERS
further states that that yield mapping saves 4.5% of the cost per acre, GPS
soil mapping saves 2.4%, guidance systems save 2.7%, and VRT saves between 3.7
and 3.9%. These high-cost savings with the implementation of digital farming
can help farmers manage their finances well and are expected to drive the
growth of the global digital farming marking during the forecast period.
Reduction in greenhouse gas
emission with the use of digital farming techniques
Agriculture
has been a significant profession for as long as humans have existed on the
planet.At the same time, agricultural production is the major source of CO2
pollution in the global food system, which contributes negatively to climate
change. According to the Consultative Group on International Agricultural
Research (CGIAR), the global food system, including fertilizer manufacture to
food storage and packaging, contributes more than one-third of global
greenhouse gas (GHG) emissions. According to international Energy Agency, India
accounted for 7% of global greenhouse gas emissions in 2018 with agriculture
and livestock contributing around 18% of total national GHG emissions. The
World Economic Forum has estimated that if only 15-20% of farms around the
globe adopted precision farming by 2030, yield could increase by 10-15% with
GHG emissions and water use reduced by 10% and 20% respectively. These factors
are contributing largely towards the growing acceptance of digital farming
techniques and are expected to drive the market during the forecast period.
Lack of awareness and understanding
is expected to hamper the growth of the global digital farming market during
the forecast period.
The most
significant challenge associated with digital farming is the lack of awareness
and understanding of the technology. To understand the working of new
technologies and to see how things will change, an imaginative approach is
required. A lot of farmers don’t have any idea how digital farming works. This
lack of awareness and understanding along with the high cost of advanced
equipment and technology is expected to impede the growth of the global digital
farming market during the forecast period.
Greenhouse farming accounted for
the largest share in the global digital farming market in 2020
Based on
application, greenhouse farming segment held the largest share in the global digital
farming market in 2020. Greenhouse farming refers to the growing of crops under
a large structure, covered fully or partially with a transparent material.
Greenhouse farming has been in use for centuries now. People use greenhouse farming
to grow all kinds of crops with tomatoes, cucumbers, peppers, and melons being
the most popular ones. Greenhouse farming is also used to grow fruits such as
grapes, cherry, Japanese persimmon, fig, loquats, lemon, and mangoes along with
a variety of flowers. World’s biggest green-house farming project, the Eden
project holds more than 100,000 plants from over 5,000 species. Greenhouse
farming’s ability to grow diversified crops outside their natural habitat
contributed largely towards the largest market share of the segment in the
global digital farming market based on application.
Global Digital Farming Market: Regional
insights
The global digital
farming market is divided into the Asia-Pacific (APAC), North America, Europe,
Latin America, and the Middle East & Africa regions. Europe
dominated the global digital farming market in 2020, closely followed by North
America. Additionally, the Netherlands in Europe is a global leader in
agricultural innovation with the integration of green-house farming and
precision farming. The Netherlands holds over one-third of global
vegetable seed trade and is the world's largest exporter of onions
and potatoes. Wageningen University & Research (WUR), widely recognized as the world's leading agricultural research institute, is the driving force
behind the Dutch country's rapid growth in the digital farming industry.European
Commission is also supporting the adoption of digital farming in European
countries with its USD 90 billion Horizon program. All these factors, combined with
the availability of latest technology, strong infrastructure, reinforced supply
chain, and robust financials are leading to Europe's significant market share
in the global digital farming market in 2020.
COVID-19 Impact on Global Digital Farming Market
A majority
of the industries have been affected negatively by COVID-19. While some have
started to recover, others are still trying to figure a way out. The demand for
food and agriculture products skyrocketed with the commencement of lockdown. As
a result, farmers faced numerous challenges in meeting increased demand, with the
supply chain badly disrupted.The COVID-19 pandemic also disrupted the global digital
farming market. As a result, the companies started to focus more on wireless
real-time decision-making technology based on the data received from digital
farming technology. The sector recovered quickly towards the end of the year as
lockdown restrictions were gradually lifted. As things returned to normal, the
global digital farming market is expected to expand.
The Leading Players operating in the Market
are Cisco Systems
Inc., Gamaya SA, Trimble Navigation Ltd., Accenture PLC, Epicor Software
Corporation,AGCO Corporation,Salt Mobile SA, Deere & Co., IBM Corporation,
Hexagone AB, Bayer CropScience AG,and others are the key players
operating in the global digital farming market.
To
gain a larger market share, key market players are forming alliances, forming
partnerships, and participating in mergers and acquisitions. Furthermore,
market participants are focused on enhancing product quality in order to gain a
competitive advantage over other competitors.
OnApril 6, 2021,Guardian
Agriculture launched a USD 10.5 million to streamline crop protection with
eVTOL-powered precision. Guardian Agriculture has launched a first-ever
integrated eVTOL system for precision application, extending growers’ reach, minimizing
environmental impact, and curtailing product resistance.It accumulates the data
produced during the crop protection process, acts intelligently on it. Guardian
Agriculture, which provides data-driven crop security as a service, assists
farmers in growing sustainably and profitably.
On April 2, 2021,the
Malaysia Digital Economy Corporation (MDEC) and CIMB Islamic Bank Berhad (CIMB
Islamic) signed a memorandum of understanding (MoU) to catalyze Digital
Agriculture Technology (Digital Agtech) in Malaysia. The MoU also extends an
extensive micro-financing program with an allocation of USD 2.42 million as an
initial funding package
On March 23, 2021, Ghana’s end-to-end
digital farming platform, Complete Farmer, secured an undisclosed amount of
funding from Ingressive Capital to extend its footprint in other markets.
Complete Farmer, founded in 2017, has implemented a crowd-farming model with a
total of 7,200 acres of production serving resources to Asia, Europe, and the
rest of the world.
The in-depth analysis of the report
provides information about growth potential, upcoming trends, and statistics of
the global digital farming market.
It also highlights the factors driving forecasts of total market size. The
report promises to provide recent technology trends, along with industry
insights to help decision-makers make sound strategic decisions. Furthermore,
the report also analyzes the growth drivers, challenges, and competitive
dynamics of the market.
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