Global Connected Agriculture Market - 2021-2028
Connected farming can be defined as the implementation of innovative technologies for improving, managing and controlling agricultural activities, resulting in increased production and quality of agricultural products. Advancements in digital technologies have made it possible to collect and leverage a huge amount of data at minimal costs, which will help in making farming operations more insight-driven, and potentially more productive and efficient. In order to efficiently plan for harvesting, connected agriculture aims to provide real-time data on soil conditions, humidity levels and weather conditions and also to enable farmers, agribusinesses, fertilizer companies and food and beverage companies to communicate with potential buyers, traders and sellers. By implementing various connected agricultural solutions, farmers and businesses will be able to do better time management at the farm level with less use of resources. The global connected agriculture market valued USD XX million in 2020 and is forecasted to reach USD XX million by 2028, growing at a CAGR of XX% during the forecast period (2021-2028)
Market Dynamics: Increasing demand for water management across global agricultural activities
Effective water management has turned out as the most essential factor in farming practices to inflate crop yields with decreased costs while contributing to environmental stability. Agriculture leaders are worried about the scarcity of water and are working on ways to improve the management of water in agriculture. Water management applications in connected agriculture, which embrace the IoT, mobile applications, big data analytics, and decision support system are servicing to produce eco-friendly and optimized agricultural outputs for a growing population. In connected agriculture, sensors, IoT networks are programed to collect data related to an individual plant's water usage, total water usage, soil moisture, and others. Water management processes can also be automated with well-designed integrations to use basic water-saving techniques, allowing farmers time to manage manual work.
Moreover, mobile technology plays an important role in the worldwide adoption of connected farming techniques. Nearly 94 percent of farmers in the U.S. use smartphone or a cell phone, according to the Farm Journal Media Survey in 2017. The use of smartphones among farmers has been steadily rising since 2009 and is expected to reach 100% in near future. Smartphone has become a new farming tool for farmers around the world, as it is integrated with numerous agricultural-related user-friendly applications (apps). Smartphones help farmers gain accurate information on climate data and changes in the weather, helping them to prepare which crops to grow, when to harvest, and so on. Smartphones can be used for aerial imaging and record keeping which are recommended by experts. Growers can load field data and grid the details based on acres by using their cell phones. The introduction of mobile technology into farm operations is therefore expected to provide the connected agricultural market with opportunities.
However, lack of awareness among end users and high capital investment for establishing connected agriculture infrastructure is expected to act as a restraint for the market growth. Farmers or growers have to make huge investments in drones, Geographic Information Systems (GIS), and Global Positioning Systems (GPS) to collect input data, variable rate technology, and satellite devices, among others.
Market Segmentation: In-production management segment to augment the market growth
The global connected agriculture market has been segmented by application into pre-production management, in-production management and post-production management. The In-production management segment is expected to hold the largest share in the year 2019. The in-production management section of connected agriculture leads to a higher production rate with a lower cost per unit for good product quality. In-production management allows farmers to access real-time data to make proactive decisions that help in the production of effective yields. Pre-production management segment is expected to grow with a significant CAGR of xx% during the forecast period. It supports agricultural producers and businesses by providing relevant information and consulting about planning and management before production starts.
Geographical Penetration: North America is the largest market for connected agriculture with a share of nearly XX% in 2020
By geography, North America is expected to dominate the global connected agriculture market. Numerous government initiatives have been undertaken in developing countries such as US and Canada to encourage the implementation of advanced farming technologies, which has elevated the North America's connected agriculture market. Asia-Pacific is expected to be the fasted growing region in the global connected agriculture market. Asia-Pacific is a decisive region in the global food chain market accounting for highest amount of food and agricultural export. Countries in the region such as China, Japan, and India are embracing connected agricultural solutions for more sustainable use of available resources. The Department of Agriculture (DA) in the Philippines is evaluating the potential of drones in changing the way the seeds are planted, the way fertilizers and pesticides are applied, and the way crops are monitored. Moreover, the ministry of Japan set a goal to introduce agricultural drones for about half of the land planted with rice, wheat, and soy across Japan by 2022.
The global connected agriculture market is fragmented with presence of several players across various regions. Some of the key players of the market are Cisco Systems Inc., IBM Corporation, SAP SE, Trimble Navigation Ltd and Microsoft Corporation among others. They key players are focusing on strategies such as partnerships, acquisitions, agreements, product launches and geographical expansions. For instance,
COVID-19 Impact: Decrease in sales of key players due to supply chain disruption
The spread of COVID-19 across the globe has contributed to supply chain disturbances across agricultural ecosystems, including the demand for connected agriculture. All four quarters of the financial year 2020 is expected to see negative growth. Recovery is expected by the first quarter of 2021, and the market might start picking momentum by the end of 2021. In this scenario, it has been assumed that COVID-19 will have a minimum impact from the first quarter of 2021. Furthermore, the Covid-19 pandemic has deeply caused the agriculture sector as it slows down supply chains, delays logistics, and reduces workers in farmlands. Considering such a situation, we could say the virus has impacted the agriculture markets in a short period of time, but we also expect, the industry will quickly bounce back as governments are putting their efforts to ease the condition.