Boerenbusiness Agribusiness Awards
Robots will be commonplace for farmers in ten years
The Dutch agritech market can grow at an annual rate of 13% in the next ten years, which will triple its size by 2030. Robotization is taking off, ABN-AMRO predicts. “Agricultural entrepreneurs are one of the most innovative and IT-savvy entrepreneurs,” notes David Kemps.
Kemps is Sector Banker Industry at ABN-AMRO. He encounters many robotics in his field. Kemps notes that developments in this area are currently gaining momentum. "Prices of a lot of technology – such as sensors, video, bandwidth and cloud solutions – are all much lower. This makes it increasingly affordable, also for SMEs and startups."
This has major consequences for the agricultural sector, ABN-AMRO notes in the report 'Battle for agricultural robots breaks loose'† Co-author of the report Jan de Ruyter, Sector banker Plant Sectors, can confirm this.
ABN-AMRO estimates the current worldwide turnover in the agritech market at more than € 6,2 billion. The Netherlands has a share of 11,5% in this, which is mainly attributable to milking and feeding robots. "The Netherlands is really big in that," says Kemps. "A company like Lely is the market leader. However, the market for barn robots is already quite saturated and is still growing by 4 to 5% per year. Field robots, on the other hand, are much less common. We see that market growing by more than 30% every year."
Labor market important driver
The bank identifies a number of drivers for that growth, of which the labor market is perhaps the most important. The dependence on personnel is enormous in the agricultural sector. Kemps: "There is often a scarcity of seasonal labour, in particular. This problem was magnified during the corona crisis, but the limited availability of labor migrants is becoming an increasingly structural problem. Moreover, personnel is becoming more and more expensive."
Another important driver is the growing importance of sustainability. This means, among other things, that fertile soil is becoming increasingly scarce and the use of crop protection products is under pressure. At the same time, the world population is growing, which calls for increasingly efficient food production. Increasing traditional mechanization falls short in this regard. Moreover, this is still labour-intensive and causes problems such as soil compaction.
Triple possible
These drivers ensure that the Dutch agritech market can triple in ten years' time. From €715 million to €2,5 billion in 2030. Agritech envisages various types of field robots, as well as drones and milking and feeding robots. It also concerns related hardware, such as field sprayers and weather stations, and services, such as software to be able to perform data analyses.
A condition for this growth is that existing bottlenecks are tackled. Legislation, for example, still restricts the deployment of autonomous field robots and drones. The fragmentation of knowledge is also a bottleneck. "More knowledge sharing is needed," says Kemps. "Chains must become shorter and data protocols must be developed, so that not every party develops its own data standard."
According to Kemps, access to capital and subsidies is still a bottleneck. "Both are necessary to be able to scale up the development of robots. Finally, a good revenue model is important for the developer. Are you going to sell a robot for a large amount or do you use a rental structure with service provision? All banks are working hard to remove the barrier for farmers to use innovative machines. Buying, renting, leasing or 'as a service', it should all be possible."
flywheel effect
According to Kemps, the growth potential of the agritech market is currently arousing the interest of the industry. "Large industrial players see a new market emerging. If they start working together with the current, often small companies that have usually been working with robots for years, a step can be made. A flywheel effect is created. This ensures that robots are standardized at an affordable price. become commercially available for the agricultural sector."
According to the ABN-AMRO expert, it will not be the fault of the entrepreneurs in the sector. "Agricultural entrepreneurs are one of the most innovative and IT-savvy entrepreneurs. They quickly started embracing IT and Big Data. Think of the use of weather maps and harvest maps. The feeling for IT and technology within the sector is great. is a continuous drive for efficiency and that encourages a lot of inventiveness."
ABN-AMRO is a partner of the Boerenbusiness Agribusiness Award. The prize for companies that can improve the position of Dutch agricultural entrepreneurs with a new product or service. Register for the Agribusiness Award is still possible until September 12, 2021.
Jeanette Pennings
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