Author: Tiffany Holland, Head of Partnerships
How Agri-Food Tech will Underpin the Future of Food Security
In an era defined by escalating global demand and pressing environmental concerns, the agriculture industry finds itself facing a dilemma. The imperative to produce more with less. Driven by population growth, dwindling resources, and the need to repair biodiversity and combat climate change, makes feeding the world increasingly complex. In response the Agri-Food Tech sector is delivering a feast of innovative ways to grow and process food, driving a future production system than can not only feed the world, but gobble up carbon, enhance animal welfare, restore degraded landscapes, and fortify global biosecurity.
Productivity and Profitability – A sector in flux
Over the preceding decade, the Australian agricultural sector has surged, displaying robust growth and future aspirations to reach a formidable $100 billion industry1. During 2021-2022, the Australian agricultural, forestry, and fishing sector demonstrated the most substantial increase in productivity when compared to other sectors2. However, the industry’s ability to meet its potential is contingent upon favourable seasonal weather conditions, an increasingly precarious factor that can swiftly disrupt equilibrium. A new approach is needed.
Intensification for Sustainable Agriculture
The concept of ‘agricultural intensification’ has typically been garnered with negative sentiment, associated with concerns of environmental degradation, high chemical inputs, the emergence of disease resistance, and animal welfare issues. While these criticisms are valid and pose several ESG risks, fusing intensification with innovative technologies transforms it into one of the few viable solutions for the future of farming on a warming, overpopulated planet.
The paradigm shift to sustainable intensification centres on the pursuit of producing more output per unit of input. This concept extends beyond simple yield optimisation to encompass efficiency, resource utilisation, and responsible environmental stewardship.
Take the innovative practice of feeding cattle Asparagopsis seaweed to mitigate methane emissions from their burps. It showcases how emission reduction and heightened productivity can coexist, yielding impactful outcomes and fostering wider adoption.
Revolutionising Inputs via Technology
Historically, producers have relied on chemical inputs to enhance productivity and profit margins. Nitrogen and phosphorus fertilisers, harbingers of the Third Agricultural Revolution that saw yields soar from the beginning of this century until the 1980s, continue to play an outsized role in driving yield, but increasing usage is intertwined with environmental challenges.
Alongside this are concerns over the overuse of antibiotics in the animal food chain, while crucial
for maintaining animal protein supplies but posing significant issues, the World Health Organisation ranks antimicrobial resistance among the top 10 public health threats facing humanity3.
What first appears overwhelmingly daunting, presents an exciting opportunity for the both the sector and investors as the growing awareness and imperative for change herald a transformative era. A prime example of this transformation can be seen in Nutrivert’s postbiotic supplement, which eradicates the unnecessary use of antibiotics, demonstrating how technological progress can reshape modern agriculture effectively.
Pioneering Change – Agri-Food Tech at the vanguard
Overreliance on traditional inputs falls short of achieving the balanced sustainability we need for planet, profit, and productivity. However, the tide is turning, and this transformation is happening today. Agri-Food Tech innovations are evolving at an astonishing pace, spanning from satellite-based natural capital assessments to robotic pollinators and nano-scale fertilisers.
Building upon decades of technological advancements across fields as diverse as space technology, microengineering, geology, and more, Agri-Food Tech pioneers are leveraging the full spectrum of human scientific achievements. They are poised to create a universe of solutions that are only just beginning to fundamentally change the way we grow, process, and distribute our food.
The Opportunity for Investors
While agriculture’s role in achieving sustainability and biodiversity goals is undeniably significant, the precise pathway to achieving these goals remains uncertain. Globally, there is an estimated USD $260 billion annual investment gap that must be bridged to meet the targets of the Sustainable Development Goal 2 – Zero Hunger – by 2030. Additionally, an average of over USD $700 billion per year is needed to close the investment gap to protect and regenerate biodiversity, vital to global food production4.
Investing in Agri-Technology and Sustainable Agriculture is not only a necessity to expedite our transition but also presents an attractive investment opportunity. Investors can access this rapidly advancing sector through diversified alternative funds which have the potential to deliver high-growth and tangible positive impact.
With Agri-Food Tech just beginning its ascension, fuelled by producer demand, and riding a global tailwind of supportive government policies, the stage is set for the Fourth Agricultural Revolution. Those who recognise this potential now stand to gain substantial rewards well into the future.
1. Australian Government – Department of Agriculture, Water and the Environment. Delivering Ag2023. 2. Australian Government – Productivity Commission – 2023 PC productivity insights. 3. World Health Organisation – Antimicrobial Resistance. 4. International Institute for Sustainable Development – Ways Investors Can Boost Sustainable Agriculture.
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