10 Key Trends in Agriculture and How They Will Shape the Industry: Part 1

The future of agriculture is being shaped now. Through extensive research, investment and innovation, radical transformations are taking place at every stage of the fresh produce supply chain. But what will the future of agriculture look like? We’ve identified 5 important trends that will help shape the agricultural sector in decades to come – Excess Demand, Traceability, Waste Reduction, Urban Farming & Carbon Neutral Farming.

Below, we look at what these trends mean, what is driving them and how they might shape the future of fresh produce:

Excess Demand

Whilst the growth rate of the world’s population is actually slowing down in percentage terms, the rapid expansion of the world’s population from 2 billion in 1928 to 7.7 billion in 2019 has resulted in a very densely populated world with a lot of mouths to feed. This figure is projected to increase to almost 10 billion by 2050, which will radically boost global demand for fresh produce and put a strain on existing supply chains. Despite increases in per field production efficiency, global fresh produce supply chains need to adapt to better meet the needs of a growing global population.

According to the United Nations, the world isn’t on track to achieved its Zero Hunger development goal by 2030 as planned. In fact, the UN predicts that if recent trends continue, the number of people affected by hunger will surpass 840 million 2030. The UN has made it abundantly clear that global fresh produce supply and the wider agricultural sector will need to profoundly change if we are to make real progress in ending world hunger. As highlighted in a recent McKinsey report on the agricultural sector, African agricultural producers may hold the key to unlocking this progress. The vast open planes and the diverse climate of the African continent make it ripe for agricultural cultivation on a massive scale. Asian investment capital is flooding in to the continent, spending significant sums on improving irrigation, roads and infrastructure.

However, in order for real progress to be made towards improving global fresh produce supply chains there needs to be political cooperation between developed and developing economies, as well as policy that promotes fair competition. For decades the Common Agricultural Policy and subsidies given to EU farmers created an uncompetitive environment that was detrimental to African agriculture as African producers couldn’t compete with heavily subsidised European prices. According to the UN, the removal of these distortionary subsidies in 2017 has helped create progress in aligning agricultural policy with international development goals. For the UK market, the end of EU subsidies and the strict post-Brexit trading regulations make the prospect of trading with Africa much more financially appealing.

FruPro’s platform aims to help optimise global supply chains and help meet global fresh produce demand through opening up new opportunities for your business to access global supply networks by being the ecosystem where all fresh produce businesses can connect globally.

Traceability

Innovation in agri-tech is booming and is creating new opportunities for enhanced transparency and traceability trend in agriculture, especially in fresh produce supply chains. In the agricultural sector, transparency relates to the information that is provided by growers of fresh produce, whilst traceability relates to the ability for other parties to authenticate those products. According to a recent KPMG report, traceability is becoming increasingly more important in the agricultural sector, as it is vital for establishing trust, assuring quality and improving sustainability. Increased trust, greater quality assurance and improved sustainability creates positive outcomes for the entire fresh produce supply chain, including end-consumers, which helps to explain why technological investments in food traceability are expected to reach an estimated $19 billion by 2023.

What does agri-food traceability look like in practice? Traditionally, information about agricultural produce would be recorded manually by farm workers and was then shared with other parties of the supply chain, either through physical handbooks or via a basic computer system. Fast forward to 2022 and modern farms now equipped with sophisticated IoT networks and systems that are integrated vertically down the supply chain, talking to each other in real time, while the use of RFID cards and barcodes allows importers, wholesalers and retailers to track and authenticate consignments as they pass through the supply chain. At the retail level, with consumers becoming increasingly familiar with the use of QR codes during Covid-19, traceability might allow consumers to simply scan a QR code to identify the source of the fresh produce so that they can verify the sustainability credentials of the producers.

Blockchain technology presents another exciting avenue for potential transformation in the agricultural traceability space, with significant investment currently going into the research and testing of the potential applications of blockchain for supply chain traceability. The fundamentals of blockchain – distributed ledgers, immutable records, verifiable transactions and trustless systems – make it an almost perfect fit for the complex fresh produce supply chain. All parties of the supply chain would theoretically be able to record information on the blockchain and verify each previous record without having to have any direct contact with other parties. This presents a huge opportunity for provenance verification, food safety auditing and sustainability.

Overall, it’s clear that improvements in traceability could provide significant benefits for all parties of the supply chain. As interest in sustainability continues to grow, there will likely be substantial brand and pricing benefits for companies that are able to provide a transparent and verifiable supply chain too. Here at FruPro, we’re making great progress in improving traceability in the entire fresh produce supply chain. Our platform helps importers, wholesalers and retailers to gain assurance on quality and provenance through unique tracking codes on products that relate to the growers with clear information on the brand, variety and where the produce has come from.

Waste Reduction as a Trend in Agriculture

Historically, the agricultural sector has been one of the largest contributors of global greenhouse gas emissions and is currently expecting to generate between 19%-29% of global emissions. Within the sector, food waste is one of the major issues contributing to the total level of emissions, with 1/3 of all global fresh produce ending up in landfill and consequently contributing 6% of the total. Moreover, there is an unfortunate dichotomy between rising hunger around at the world with simultaneous increases in food waste. Clearly, a solution to this issue is needed and through technological advances and coherent government policy, we may get there.

With sustainability now being a key priority for governments, NGOs and individuals, the industry is making substantial progress in developing new technologies, systems and methods to lower its environmental impact. At the top of the supply chain, fruit and veg growers are utilising smart farming technology to more accurately match supply to demand, boost efficiencies and reduce surplus wastage.

Further down the fresh produce supply chain, whilst the consignments are in transit, integrated systems and RFID tracking are providing enhanced planning and tracking capabilities, which is helping to reduce the amount of food that is lost during transit. At the end of the supply chain, fruit and veg retailers are helping to reduce food waste through improved storage and new policies around imperfect fruits and vegetables. There is a growing acceptance amongst eco-conscious consumers of imperfect fruits and vegetables, which until recent years wouldn’t have made it to the supermarket shelves.

FruPro’s revolutionary platform will also help to optimise supply chains and reduce the amount of food that is lost through its sophisticated reallocation and redistribution model, which connects the fresh produce company with their local food bank or desired charity and reducing the burden of redistribution.

Urban Farming

Urban farming, also known as indoor farming, hydroponic farming and vertical farming, is the process of cultivating, processing and distributing fresh produce in urban areas. Urban farming enterprises can utilise rooftops or even the sides of buildings, but for the most part they are large indoor farms in warehouse type facilities with endless rows of fruits and vegetables being grown in vertical stacks. There has been a rapid rise in urban farming enterprises over recent years, with the global urban farming market expected to grow even further from $3.1 billion in 2021 to $9.7 billion by 2026. Compared to traditional farming, urban farming provides a distinct range of benefits, such as a higher yield efficiency, year-round production due to weather independence and greater utilisation of resources.

Urban farming offers huge potential to produce fruits and vegetables at scale, with increased efficiency and reduced carbon emissions. Although the types of crops produced within urban farms tend to be more limited, the sector could help to battle the ever-growing demand for fresh produce. Much of the world is now living in densely populated urban areas and this helps to explain why a shift to urban agricultural production is taking place. Covid-19 has certainly increased the potential audience size for urban farming enterprises, with consumers increasingly wanting to shop and consume locally. Why buy your fresh fruits and vegetables from an unknown farm 500 miles away when you can buy from your local urban farmer?

FruPro’s platform provides a centralised marketplace for the entire fresh produce supply chain, thus enabling more hyper localised distribution.

Carbon Neutral Farming Trend in Agriculture

Carbon neutral farming refers to the balancing of all emissions produced on farms so that the net balance of emissions is equal to zero. As described in section 3, the agricultural sector is a huge contributor to greenhouse gas emissions, and this explains the growing movement towards carbon neutral farming. Everyday farming activities contribute significantly to carbon dioxide release, including driving tractors, tilling soil, over-grazing and using fossil fuel-based fertilizers, pesticides and herbicides. In practice, there are many routes to achieving net zero carbon emissions and thus carbon neutral farming can take many forms.

Carbon sequestration is a viable method that could be globally adopted for climate mitigation, but its success would require the changes in the practices of more than 500 million farms worldwide. Increasing the use of renewable energies is another important avenue that could substantially reduce carbon dioxide emissions, where farms can utilise solar and wind energy to produce low or no-carbon electricity. However, the appropriate fiscal incentives will be required in order to help many farms transition to renewables. Grants and low interest loans may help to encourage farm owners to purchase equipment with high capital costs. Reducing the volume of fertilisers used, reducing tillage and reducing water consumption are other important avenues too. Through technological advances, farmers can more accurately predict the exact requirements per plant and thus can plan their resource consumption more efficiently.

For significant progress to be made in this space, there needs to be cooperation between governments around the world so that coherent sustainable policies are developed, suitable education is provided, and incentives are created. Although it will be challenging, a large determinant of the success of achieving global net zero in farming is the ability for domestic and international markets to cooperate and share data. The sharing of data will allow countries to learn from each other and to assess the impact the movement is having on global emissions. Most importantly, sophisticated monitoring tools are needed so that farms are actually able to collect and share this data, whilst regulators are able to verify actions through a transparent framework.

FruPro is seeking to help the industry reduce its carbon footprint through partnering with technology companies and growers championing the move to net zero. Our future roadmap although a transport solution, is to optimise the delivery process to reduce C02 emissions.

Final Thoughts

Global demand for fresh produce creates many challenges for stakeholders in the agricultural sector and indeed for governments around the world too. Technological developments are allowing the industry to tackle these challenges; making great progress in boosting the global supply of fresh produce and combatting the sustainability challenges associated with the sector. These developments help all industry players to serve the rising trends in agriculture.

Optimising global supply chains and improving sustainable outcomes in the agricultural sector is at the heart of FruPro’s mission. Our global network of growers, importers, wholesalers and retailers, supply chain optimisation tools and redistribution mechanisms are shaping the future of the agricultural sector. If you want to be part of the fresh produce revolution, register today or get in touch to book a free platform demo.

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11th August 2023