Upstream Ag Professional - March 16th 2025

Essential news and analysis for agribusiness leaders

Author

Shane Thomas
March 16, 2025 • Read Time: 9 minutes

Welcome to the 85th Edition of Upstream Ag Professional!

Index

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1. World AgriTech Innovation Summit Takeaways

The overall sentiment at this year's World AgriTech Innovation Summit was notably subdued. Attendance seemed lower, and conversations carried a tone of concern.

Between investor uncertainty in ability to raise further funds, which startups to prioritize, startup survival concerns, and broader ag and macro economic market challenges, the conference definitely reflected the headwinds facing agribusinesses, investors and agtech companies today.

Investor Sentiment

Venture capital firms and other investors seemed to be increasingly scrutinizing their investments and questioning where returns will come from. Raising new funds seemingly remains difficult (there are more firms, inside and outside agtech, than ever looking for capital), and the appetite for deploying capital into upstream agriculture seems to be waning— particularly from those that are not “ag” focused (eg: have a downstream food mandate, “climate tech” focus etc.). Many of the investors I talked to were prioritizing the conference to connect with and support their current portfolio, or raise funds for themselves.

The question around returns and raising are not unique to ag, though— given that ag has been challenged at delivering returns relative to other industries, does bring up the question of whether the farm gate upward in the value chain is the best place to park dollars to maximize LP returns:

Source: Pitchbook

"Default Alive"

With fewer new funds available, startups are prioritizing "default alive"— zeroing in their focus and cutting expenses. The only options being to prioritize profitability— the term sheets that are out there do not sound great and bridge rounds seem like they are decreasing, meaning down rounds will be common for those that do find capital and flat rounds will be considered a positive.

With that said, I spoke with a handful of startups that remain optimistic. They also acknowledge that raising capital is not a business model in and of itself like some seemingly have assumed.

These optimistic companies have carved out a unique value proposition for farmers or agribusinesses—solving unique problems in ways that resonate with the market and are not competing directly with other segments. The common theme among them: focus and controlling the controllable.

Regardless of what the macro-environment and sentiment is, there will always be room for innovative and disciplined companies that are solving a problem for agribusinesses and/or farmers.

Exit Potential: Who is Buying?

Mergers and acquisitions (M&A) remain a lever for incumbents, but not all large agribusinesses are in a great financial position to acquire— even with valuations coming down. A few that seem positioned well based off balance sheet, executive commentary and long term focus:

  • Corteva has explicitly stated its focus on M&A, with particular interest in biologicals and gene editing technologies.

  • John Deere, has a long term mindset and likely recognizes that current market conditions allow for acquiring bolt-on technologies and personnel at a discount compared to just 18 months ago.

  • Nutrien has also stated they are interested in investing in their proprietary products business.

These companies are better capitalized (relative to other ag companies) which has them in a position to augment themselves through selective acquisitions at opportunistic prices.

With the uncertainty in the market I wonder if we will see more of what occurred with EarthOptics and PatternAg merging and raising capital from investors as one? Or, if valuations are down enough to entice more private equity roll ups, such as we have seen with Ever.Ag and more recently with BW Fusion and Bain, for example.

AI, Robotics, Digital and Regen Ag

Areas that I had conversations on:

  • AI — There is continued interest in artificial intelligence, but uncertainty remains around its tangible applications in agriculture. While the potential for decision-support tools and automation exists, many discussions revolved around AI's ability to reduce labor costs rather than fundamentally change decision-making. There has been a view that AI for decision making will generate interest and value, however, this seemingly remains to be seen, at least in terms of farmers and agribusinesses willingness to pay. Where there seems to be more interest is in where there is tangible ability to cut costs, such as labor (which leads more to second point on robotics).

    • I had a conversation with Syngenta CIO/CDO Feroz Sheikh and he reinforced that Syngenta sees AI tools creating value in crop protection discovery from both an efficiency perspective and a cost reduction perspective.

    • There seemed to be an emphasis on “AI” companies, but from my point of view it wasn’t clear what specific type of AI to be bullish on in any short term (<3 years) future (eg: machine vision or GenAI etc)

  • Robotics — Interest in automation and robotics remains high and seemed to have more buzz this year than in previous years.

  • Digital Software — I had conversations with the large crop protection company teams and they all reinforced that they are continuing to invest in digital solutions, but their approaches vary.

    • For example, Syngenta continues to emphasize digital tools as augmentative to their crop protection/seed products, a view I have long been biased towards. Whereas xarvio has went a different route, optimistic that they can create independent revenue streams from their digital system. It will be interesting to see how these different strategies play out over time, especially considering the ever increasing generic threats, the increase in precision technology and a farmers perception of bias.

  • RegenAg — There continues to be emphasis on “regenerative ag” from startups and incumbents. Investing in regenerative or enabling it, which seems essentially code for doing more with less (aka the foundation of any technology that has been commercialized in ag) or having a biological or natural bent to it. Both good things, but a soil sensor, for example, is as much a tool for “conventional agriculture” as it is “regenerative agriculture.”

Other anecdotal comments:

  • As someone that has actively scavenged for news and headlines for more than 5 years: Typically the week around World Agritech is full of announcements from partnerships, to raises, to new products…this year was much slower than previous years.

  • The feedback on the panel sessions was the same as previous years: high level with little specificity or depth and few novel insights for those that spend their day-to-day working in the industry. I think most individuals on these panels DO have unique points of view and insight, but given they are representing their respective organizations, they generally stick to commentary that is approved through corporate communications, so I do not fault the panelists— though it brings up the conference business model. The events financial success is predicated sponsors, and sponsors tend to get panel spots for their team members. Seeing more contrarian takes would increase the value of the conference, in my opinion. That might be wishful thinking though.

    • I think the other challenge is the nature of having broad panel topics like “How Can AI Transform Regenerative Agriculture” or “Food System Resilience: Setting Strategic Priorities in Times of Change” — the topics aren’t constrained enough to get deep, and generally have a breadth of experience across areas, which doesn’t usually allow for meaningful conversation amongst panelists because they are talking about different areas. A level of disagreement or friction between points of view would benefit the audience.

  • The event remains one of the best networking opportunities for those interested in agricultural technology— it presents an unparalleled opportunity to connect with individuals from around the world, whether they are start-up founders, investors or senior leadership from the most influential agribusinesses.

Over the last month, I have read dozens of earnings call transcripts along with quarterly fertilizer company results, working to identify trends and key takeaways across the segment.

The below report is an aggregation of those materials and includes:

  1. one financial comparison chart of major fertilizer companies

  2. an overview of major fertilizer segments:

    a. Potash

    b. Phosphate

    c. Nitrogen

    d. Tariffs and Geopolitics

    e. Specialty Fertilizer and Biologicals

  3. Notable quotes from executives

  4. Overview of the following businesses FY 2024 and 2025 Outlook:

    a. Nutrien

    b. Yara

    c. CF Industries

    d. ICL

    e. Mosaic

FY 2024 Financial KPI Comparison for Fertilizer Businesses

One section from the overall report on Premium Product Segments is below. For the full breakdown, check out the link in the heading.

Premium Product Segment

Mosaic on Mosaic BioSciences:

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