Upstream Ag Insights - June 24th 2024

Essential news and analysis for agribusiness leaders.

June 24, 2024 • Read Time: 18 minutes

Welcome to the forefront of agricultural innovation with the 221st edition of Upstream Ag Insights, where over 16,700 agribusiness leaders start their week discovering the latest industry news and learning about groundbreaking innovations and business strategies shaping the future of agriculture.

With curation and analysis from Shane Thomas, each edition delivers unparalleled insights and expert analysis meticulously crafted for the practical professional, empowering you to be among the best informed in the industry and make superior tactical and strategic decisions.

Whether you're a new subscriber or this email was forwarded to you, Upstream’s field-tested frameworks and in-depth examinations equip you with the knowledge and foresight to seize opportunities and catalyze growth in your business and career.

Index:

  1. Bayer Crop Science 2024 Innovation Day Highlights and Analysis

  2. Will Artificial Intelligence Take Our Jobs? Or Will It Drive Better Outcomes and Productivity?

  3. Syngenta and InstaDeep collaborate to accelerate crops seeds trait research using AI Large Language Models

  4. Nutrien Ag Solutions Acquires New Biocontrol Technology

  5. The Farm Data Value Paradox

  6. 5 Key Takeaways for Agribusiness Professionals from Stratus Ag Research Report: Boosting Ag Retailer Success Through Manufacturer Support

  7. Jevons Paradox, Complement Disruption and Precision Applications in Agriculture: Implications for Crop Protection Manufacturers

  8. "What is the impact of an losing patented status on the price of an agrochemical active ingredient?"

  9. Upstream LLM Search Functionality

  10. Non-Ag Articles: “What will I tell my boss?” and What is “customer-centric”?

  11. Other Interesting Ag Articles (8 linked articles this week)

This week’s edition is brought to you in partnership with The Combine:

One of the most important steps that successful AgTech Founders do is taking the time to learn their customer.  

However, if a founder isn’t already in the ag space, it can be hard to connect with farmers and ranchers.

That’s why The Combine created the Insights Network.

The Insights Network is a pioneering group of agricultural producers dedicated to shaping the future of AgTech! It connects innovative AgTech Startup Founders with real-world agricultural expertise, guiding founders to product-market fit.

The Combine Insights Network bridges the gap between early-stage entrepreneurs and Nebraska's top-tier farmers. Through being an incubator startup or a startup-in-residence, companies are paired with producers to help them do customer discovery, run test trials, and make sure there is a product-market fit.

How does this benefit founders in The Combine?

  • Exclusive Access to Producers: Access a network that includes over 100 producers across various agricultural industries – from corn and cattle to sugar beets.

  • Progressive Partnerships: Collaborate with some of the most forward-thinking farmers and ranchers in the nation, who are committed to driving agricultural innovation.

  • Assistance for Pilot Programs: The Combine’s Insights Network Manager helps connect founders with the right producers to trial your products.

Learn more about the Insights Network today:

On June 17th, Bayer had its 2024 Crop Science Innovation Update in Chicago.

The company built on their 2023 Innovation event in New York to highlight what they frame as ten blockbuster launches over the next decade.

Each blockbuster is projected to contribute over €500 million each to Bayer's €32 billion forecasted R&D pipeline.

The ten blockbusters include:

  1. Preceon Smart Corn: Breeding and Biotech Approaches for their short corn efforts.

  2. Plenexos Insecticide: next-generation ketoenol insecticide with high plant mobility and strong efficacy against sucking pests at low dose rates for foliar and soil uses.

  3. Icafolin Herbicide: a new mode of action for post emergence weed control based on Bayer’s CropKey approach.

  4. New Fungicide: For global use in cereals, corn, fruits & vegetables with upside potential in numerous other crops, it also has a compelling regulatory profile.

  5. Fourth-Generation Soy Herbicide Tolerance Trait and Fifth-Generation Soy Herbicide Tolerance Trait: Fourth generation will include tolerance to five products, including HPPD (Mesotrione) and 2,4-D tolerance to existing traits that provide glyphosate, glufosinate, and dicamba tolerance. The Fifth generation will ad PPO tolerance for six modes of action in one product.

  6. Third-Generation Soy Insect Trait and Fourth-Generation Soy Insect Trait: The third generation trait offering includes two new proteins for enhanced protection from lepidopteran pests, with a focus on Latin America and expected launch in 2028. The fourth generation Trait will use multiple modes of action to further enhance the Intacta franchise with multiple modes of action for control against velvetbean caterpillar and soybean looper.

  7. Fourth-Generation Corn Rootworm Trait and Fifth-Generation Corn Herbicide Tolerance Trait: The fourth generation of Bayer’s Corn Rootworm trait (CRW4) is expected to launch mid-decade. CRW4 features two new modes of action plus improved RNAi technology to enhance efficacy against rootworm populations.

I combined these into seven because numbers 5, 6 and 7 are the evolution of trait technology.

After the event, there were four things I was thinking about:

  1. 250 million acres within FieldView and Digitally Enabled Sales Definition

  2. N Fixing Biological Product and Biological Development

  3. Innovative Soybean Trait Tech and the Opportunity for Innovative Incentives and Bundling

  4. Regenerative Agriculture and Bayer’s True Competitive Advantage

For the full deep dive of these of these four areas, become an Upstream Ag Professional member:

Related: Regenerative Ag Doesn’t Have to be Contentious - Upstream Ag Professional

This week I had some conversations about the future of jobs in agribusiness and AI.

There is always a fear of job loss, though I think the fear isn’t job loss itself as much as fear of the unknown, fear of having to re-skill and a fear of change from what one knows and understands.

But I do think there are frameworks that can help us understand why the risk of job elimination is unlikely.

Luddites

Luddite is now a blanket term for people who dislike new technology. It originates in a 19th-century labour movement that rallied against how mechanized manufacturers and their unskilled laborers undermined the skilled artisans of the day. 

The original Luddites were British weavers and textile workers who objected to the increased use of mechanized looms and knitting machines. Most were trained artisans who had spent years learning their craft, and they feared that unskilled machine operators were robbing them of their livelihood. When the economic pressures made the cheap competition of early textile factories particularly threatening to the artisans, a few desperate weavers began breaking into factories and smashing textile machines. They called themselves “Luddites” after Ned Ludd, a young apprentice rumoured to have wrecked a textile system in 1779.

Machine-breaking Luddites attacked and burned factories. The workers hoped their raids would deter employers from installing expensive machinery ultimately allowing them to maintain their relevance in the workforce.

Mechanization was never going to slow down in 19th-century England. Economic progress depended on the ability of companies to compete, and mechanization was foundational to the industrial revolution. In fact, it was so important to the government, they moved forward the death penalty for anyone found to destroy assets at these facilities.

As we all know, the industrial revolution happened and mechanization progressed societies across the world. This same competitive landscape can be applied to artificial intelligence tools in agriculture.

The Lump of Labour

Building on the Luddites story, we’ve been automating work for 200 years. Every time we go through a wave of new technology and automation, whole classes of jobs go away, but new classes of jobs get created. There is pain and challenge in that process, but over time the total number of jobs doesn’t go down, and we have all become more prosperous. The pain and fear stem from the Lump of Labor Fallacy.

The Lump of Labor Fallacy is the misconception that there is a fixed amount of work to be done, and that if some work is taken by a machine, then there will be less work for people.

But if it becomes cheaper to use a machine to make a t-shirt, then the shirt is cheaper, more people can buy the shirt and they have more money to spend on other things, and we discover new things we need or want, and new jobs.

This concept stems from a concept I talk about alot in regards to See and Spray Technology: Jevon’s Paradox. Gains in efficiency generally lead to demand for more of what was made more efficient.

The efficiency gain isn’t confined to the shirt: generally, it ripples outward through the economy and creates new prosperity and new jobs. We don’t know what the jobs will be, but we know they will come. This is the same in agriculture, specifically with the likes of AI, we see actions and tasks get automated— whether directly on the farm or within the value chain itself. There are ripple effects and second order implications that can be positive.

For the full overview of how jobs like an agronomist will shift, along with the framework to think through jobs in your organization, and how there are ample opportunities for AI to improve the outcomes of agtech offerings, become an Upstream Ag Professional member today:

Syngenta Seeds, one of the world’s leading global agriculture technology companies, today announced a collaboration with AI company, InstaDeep, to bring Syngenta’s proprietary trait research and development capabilities together with InstaDeep’s Large Language Model (LLM) platform to accelerate the development of solution-providing crop traits for farmers.

InstaDeep has developed a state-of-the-art language model, AgroNT, trained on trillions of nucleotides from agriculturally relevant crop species, to interpret the complex language of the genetic code. This next-generation AI technology learns from nature and was designed to accurately predict how genes are regulated, potentially enabling a new level of trait control and crop performance.

One of the opportunities for AI in agriculture is increasing the velocity of R&D— in crop protection, like we see with Bayer and their CropKey initiative or AgPlenus with ChemPass AI and also in variety development, such as this partnership from Syngenta and InstaDeep, or AgPlenus and Generator AI.

InstaDeep is an interesting organization with more than an ag model for nucleotides. They also offer models for manufacturing, logistics and energy.

For more on the InstaDeep model, become an Upstream Ag Professional member today:

Nutrien Ag Solutions has made a significant stride in the agricultural technology sector with the acquisition of Suncor Energy’s AgroScience assets, marking a strategic expansion into the biocontrol market.

The acquisition includes several patented and patent-pending technologies, notably a chlorin-based photosensitizer aimed at revolutionizing integrated pest management (IPM) worldwide.

The newly acquired technology, developed by Suncor Agroscience, represents a breakthrough in biocontrol solutions.

For more on why this announcement is important for Nutrien and how it might play into the recently announced global distribution initiative, become an Upstream Ag Professional member today:

More covered in last week’s Nutrien 2024 Investor Day Highlights and Analysis - Upstream Ag Professional

5. The Farm Data Value Paradox - Raymond King Linkedin

The Farm Data Value Paradox is a well written article by Raymond King.

It’s consistent with the views I have surrounding where data becomes the most valuable in an agriculture setting:

  1. Data is most valuable when used to deliver a better outcome (eg: insights that enable decisions)

  2. Data will be valuable when you associate it with a physical output or asset (eg: grain ton or farmland)

  3. Integrated with other data (eg: multiple data sets, such as soil data, as applied data etc)

It’s what you do with data that makes it valuable. What’s the edge? What’s the opportunity? How can it enable a better outcome?

For more on data in agriculture, the challenge in assessing its value, the paradox to overcome and where the opportunity is in training agribusiness staff, become an Upstream Ag Professional member today:

A few weeks ago I emphasized the importance of the retailer when discussing consolidation implications in the world of crop inputs:

It’s often said that the retail will go extinct, however, the retailer is the one with the farmer relationship which is a core component of staying power. The “last mile” is often the most difficult (financing, delivery, market nuance etc).

“Influence erosion” of the ag retailer is happening and challenging retail margins however, the grip that local retail agronomists and sales representatives have on farmer decisions remains strong.

Stratus Ag Research recently released a report titled Boosting Ag Retailer Success Through Manufacturer Support and there were five takeaways for me.

Summary of Key Takeaways

  1. Key Takeaway #1: Design marketing campaign to drive the farmer to ask retailer about the product.

  2. Key Takeaway #2: Print and direct media is continuing to be more effective than digital.

    1. Ancillary takeaway: Opportunity to identify better digital channels for advertising.

  3. Key Takeaways #3: Incentivize the retailer and give them effective collateral for engaging in a value-added discussion with farmers (eg: trial data, interactive tools etc)

  4. Key Takeaway #4: Align sales representative resources to maximize revenue (marketing budget, grower reps and retail reps, account teams etc.)

  5. Key Takeaway #5: If you are an agtech provider, go-to-market approach and focused efforts matter.

For the full Upstream Ag Professional deep dive, including exclusive charts and images from the Stratus report, become an Upstream Ag Professional member:

Jevons Paradox is crucial for agribusiness professionals to understand— for everything from input usage, to how artificial intelligence will impact jobs. In this exclusive Upstream Ag Professional article we breakdown the implications of it, and complement disruption, one of the biggest risks to agribusinesses selling inputs today to deliver a framework for agribusiness professionals to be positioned well for the future of the industry.

Index:

  1. Understanding Jevons Paradox

  2. Real World Examples

    1. Energy and Iron

    2. Transportation

  3. Extrapolating to Farming

    1. Yield and Quality as a Primary Revenue Method

    2. Early Examples and Practice Evolution

    3. Herbicide Resistance

    4. Not an Isolated Technology

  4. Second Order Implications

    1. Commoditization of Crop Protection Products

    2. The Jobs-to-be-Done Lens Behind Crop Input Decision Making

    3. Disruption Through Complements

    4. Access to Information

  5. Final Thoughts

    1. Implications for Input Manufacturers

Notably, there isn’t a “cliff,” thanks to post patent strategies that most major crop protection companies are very competent in (new formulations, co-mix, crop registrations, manufacturing IP, third party agreements as typical examples) but what’s interesting is the variance once an AI get’s to about 7 years post patent:

Non Ag Articles

(below is the entire blog post)

If you can’t answer that six-word question, you’re selling a commodity.

Organizations don’t buy things, people do. And people at companies aren’t spending their own money, so this is the only question on the table.

A cogent story, based on affiliation and status, one that sees and respects the dynamics of the organization, is actually what they’re paying for.

I love this post because it gets at the heart of B2B selling that is often not acknowledged— the features and functionality of a product are only so important. “Affiliation and status” that decision makers accrue from association with finding and championing your product are influential in the decision making process as well— exploiting that is important and goes back to your own marketing and messaging.

What is “customer-centric”? - Everything New is Dangerous

A term I hear increasingly within agriculture is “customer centric.”

I tend to believe the most “customer centric” companies do not have to state it— it shows through in the products and services they deliver into the market, their pricing power and the profits they ultimately reap.

Successful organizations have their customer’s needs at the heart of their business model, they understand the context and the need driving their desired impact. Then strive to influence or design their business from culture and mindset to strategy, technology, data, processes and collaboration to be the best possible to get this done.

Other Interesting Ag Articles