Leading image

Investing in the ICT4Ag application space

ICT4Ag models in the developing world are proliferating. Yet most players are not yet translating momentum into impact at scale. Despite the growth of opportunities, a very small proportion of the global ICT4Ag funding targets smallholder farmers in developing countries. Rethinking strategic approaches for ICT4Ag funding can change this.

Despite efforts to catalyse agricultural transformation in developing countries, smallholder farmer productivity and income remain low. Farmers continue to lack relevant information and market access. The majority of smallholders risk remaining trapped in a self-reinforcing circle of vulnerability, low yields and food insecurity.

New technology-enabled solutions offer the opportunity to reverse this trajectory. There is a dizzying number of ICT4Ag innovations – from remote and in-situ sensing tools to big data platforms – that can improve decision-making among farmers, suppliers and governments. Rising smartphone penetration and improving connectivity, along with improved data processing and analytics capabilities, offer us the opportunity to adapt and bring these improved solutions to smallholder farmers at a fraction of the cost of traditional methods.

In most countries between 60% and 80% of smallholder farmer households have a mobile phone, and over 90% have access to said phone, with a majority increasingly using it for mobile money, or to access advisory, market and weather info. Price of broadband data service is falling precipitously, opening opportunities to deliver bandwidth-intensive applications and services.

These trends combine to create considerable momentum; ICT4Ag models in the developing world are proliferating. Directional evidence suggests the market has been growing more than 20% per year.

Yet most players are not yet translating momentum into impact at scale. Lack of evidence, challenging economics and poor understanding of the consumer, among others, continue to hamper the success of digital solutions. Also, despite the growth of opportunities – and a need for additional support – only around US$100 million of the global ICT4Ag funding (over US$5 billion in 2015) targets smallholders in developing countries. Mostly, donors do not have dedicated central programmes focused on digital solutions in agriculture. Rather, ICT4Ag projects are integrated as an element of broader agriculture projects with a community of practice or coordinator role sharing lessons learned and fostering collaboration.

The successes and lessons learned

The most successful ICT4Ag grants of the Bill & Melinda Gates Foundation built upon the ability to convene and coordinate disparate actors towards a common goal. The African Soil Information Service, has developed the first Africa-wide digital soil map. Most modern spectroscopy instrumentation for on-the-ground measurements in combination with remote-sensing has improved available soil data, while reducing the cost of soil sampling by 97%. Digital Green’s video enabled extensions services has reached more than 1 million farmers in India and Ethiopia with an adoption rate above 30% (on average) of promoted agricultural practices. SAP has developed a mobile application suite in combination with cloud based analytics to track and trace smallholder farming trade. The solution has been piloted reaching more than 100.000 farmers and is now commercially available to potential customers worldwide.

Despite these successes, there is a need for improved data evidence on the impact of such investments. For example, despite multiple investments by the Foundation and partners, the evidence for digital Rural Advisory Services’ impact on productivity and yields is still thin. Likewise, there are notable opportunities to improve in the digital management and analysis of agricultural data.

The realisation at the Foundation and partners is that we now have a major, cross-cutting opportunity to take a more strategic approach to our technology investments and galvanise the sector around the most promising approaches.

The opportunities

Within the landscape of ICT4Ag opportunities, there are roughly six digital agriculture use case areas that could support donors’ target outcomes and strategic goals. These are: rural advisory services, financial access, farm management, supply chain management, market access, and agricultural intelligence and knowledge.

Each of these use case areas is supported by a layer of data, consisting of a wide range of information, from climate insights and weather to payment and sales transactions, from land records to soil maps, and so on. Each of these data types, in turn, is generated, managed and captured by a specific type of ICT4Ag hardware or software solution, such as unmanned aerial vehicles (UAVs, also known as drones) or soil kit (hardware), or a workforce management app or e-trading platform (software). Finally, these solutions all rest upon a large and deep infrastructure of enabling technologies and infrastructure, spanning the always-essential mobile device to higher-order enablers such as a conducive set of data standards and protocols.

Refocussing and restructuring funding in the ICT4Ag application could increase smallholder farmer productivity and translate it into higher income. Therefore, the Bill & Melinda Gates Foundation is implementing in line with its new Agricultural Development Results Framework a renewed ICT4Ag strategic approach.

The new ICT4Ag strategy

The Foundation recognises that digital tools can be a key enabler to unlock impact for farmers and agricultural systems. Our new strategy will guide future investments in ICT solutions that can boost smallholder farmer productivity, income, women’s empowerment, and nutrition.

The aim is to prove ICT innovations work, de-risking investment, and mobilising private and public stakeholders to fund ICT4Ag solutions at scale. Investment opportunities are pursued in the following areas.

Participatory and Customised Rural Advisory Services have to link farmers to the knowledge necessary to drive productivity gains. Nearly half of the IC4Ag solutions focus on rural advisory services – particularly in India, Ghana and Kenya. Yet, many innovators are struggling to scale rapidly. More experimentation is needed to develop more precise, participatory and cost-effective service delivery models.

ICT-Enabled Market Linkages need to translate productivity gains into increased farmer incomes. Market linkages are perceived by many experts in digital agriculture as the key to unlock dramatic gains in smallholder income by connecting farmers to high quality inputs, and allowing to sell produce easily at the right time and at optimal prices.

Self-Service Farm Management Solutions also have to boost farm profitability and empower farmers to transition from smallholders to small businesses. Farm management solutions have emerged strongly in the last five years with over 35% annual growth, growing three times the market average. The majority of the existing solutions focus on record management (e.g., crop volumes), with a significant number of solutions having financial literacy components built in.

Finally, it is necessary to build an Agricultural Data Exchange that unlocks the “data opportunity” for private investors, agribusinesses, financial and service providers and national ag ministries and agencies. The data interoperability and sharing is a primary constraint to integrate solutions and to improve resource allocation.

In addition, the Foundation will leverage the Financial Services for the Poor programme to target digital financial services that help mitigating risks through better information and driving down transactions costs. There is strong interest in integration of alternative digital data into credit scoring and portfolio monitoring to drive financial inclusion, yet the range of data being actively used today is still narrow, business models are nascent, and most finance providers lack the capacity to use this digital data to price loans and other financial products.

By successfully executing against this vision we believe we can help double the income of millions of farming households.

Related links

Webpage of Bill & Melinda Gates Foundation

Read More

by

In ICT Update and on websites as ICT4D, CTA has covered the explosive growth and proliferation of digital and mobile phone technologies for agriculture. Now CTA takes the next step with developing the Apps4Ag database, a comprehensive, up-to-date and responsive database of ICTs including mobile, web, animation, audio, and video applications involved in the food value chains.

A selection of interesting websites, online platforms and literature on web-based and mobile applications for agriculture in the context of developing countries.

The Apps4Ag database is developed by CTA and is an online collection of over 500 applications, which provides new ways to find and discover worldwide ICT innovations for agriculture. How can you make the most of this database on www.apps4ag.org?

The Apps4Ag database has over 500 online and mobile applications and services for stakeholders in the food value chain. ICT Update gives you an insight what users from farmers, traders, researchers and decision-makers can find in the database.

Investment in mobile agricultural services is likely to be most effective where the technology is integrated into specific systems and organisational routines that are developed by new or established local innovators. They are the drivers for developing new processes and new networks on the ground that promote scale efficiencies along the value chain.

by

A vibrant enabling environment is vital for creativity, stimulus and optimism on which ICT4Ag initiatives can generate impact. Developers and innovators have to learn from cases, either successful or not, when it comes to the environments or contexts where they have been deployed. There are four areas on which an enabling environment depends.

by

ICT4Ag models in the developing world are proliferating. Yet most players are not yet translating momentum into impact at scale. Despite the growth of opportunities, a very small proportion of the global ICT4Ag funding targets smallholder farmers in developing countries. Rethinking strategic approaches for ICT4Ag funding can change this.

Location:

Past issues

ICT Update N. 91

Next-generation ACP agriculture - innovations that work

ICT Update N. 90

Women and Digitalisation in Agriculture

ICT Update N. 89

Data4Ag: New opportunities for organised smallholder farmers

ICT Update N. 88

Unlocking the potential of blockchain for agriculture

View all