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Silvio Crestana: A Matter of Survival

Cost reduction, eco-efficiency, and integration with the supply chain make investment in technology a vital imperative

Crestana says agriculture 4.0 will boost productivity, but also increase inequalities

Léo Ramos Chaves

Successful adoption of information and communication technologies will determine success or failure in agribusiness in the coming years. “It’s a matter of survival,” says Silvio Crestana, 65, who served as CEO at the Brazilian Agricultural Research Corporation (EMBRAPA) between 2005 and 2009. Now a researcher at EMBRAPA’s Instrumentation chapter, his work is devoted to exploring the impact of farming on natural resources. He predicts digitization will improve eco-efficiency, enable end-to-end supply chain traceability, and allow consumers to penalize players that fail to use sustainable farming practices.

Throughout his career, Crestana has acquired privileged insight into trends in agribusiness innovation. With a PhD in physics applied to soils from the then São Carlos Institute of Physics at the University of São Paulo, he pursued a postdoctoral degree and worked as a visiting researcher at the University of California and with the Agricultural Research Service at the United States Department of Agriculture. Crestana has authored and coauthored 200 scientific articles, and is a member of the Agribusiness Council at the São Paulo Industry Federation (FIESP).

In this interview, he warns that agriculture 4.0 could lead to increased inequalities and says the current capitalistic system will need to become more inclusive and find new ways of doing business to accommodate workers who have been displaced by technology.

What are the economic benefits from deploying information technology in agribusiness?
It’s not just about profits; it’s about survival. Either you embrace the new technologies, or you’re out of the game. Technology will give farmers insight into all the biophysical variables involved in farming, which they can use to optimize resource usage. For example, they can apply more fertilizers, pesticides, and water where they are needed, and less where they are not needed. This minimizes unnecessary expenses and environmental impact. But information is useless without communications. Farmers are at the center of the supply chain, and need a constant flow of information not only to streamline their interactions with suppliers, but also to access new markets where they can sell their products without middlemen.

How is rural internet connectivity important?
Farmers today can access a wealth of information collected from sensors on their farm machines and implements, as well as weather information and digital terrain models. With the aid of a GIS [Geographic Information System], they can use this information to plan for the next day or the next crop year. Or they can upload information from a pen drive to an analytics system. This is known as agriculture 3.0; it’s digital agriculture, but systems are not interconnected. The next step is agriculture 4.0, in which information flows in real time, but this requires rural connectivity. Farmers in the US, Germany, Australia, China, and Japan all have connectivity. They can remotely optimize and synchronize harvesters and trucks, or even the entire farm operation.

What is needed to implement farm connectivity?
It’s less about technology and more about investment. An estimated 4,330 4G antennas [radio base stations] operating at a frequency of 700 megahertz (MHz) will be needed to connect Brazil’s 72 million hectares of grain and sugarcane crops. The government apparently lacks the resources to do it, but the investment could, at least partly, be funded by the private sector. At R$31 per hectare, the cost of installing the infrastructure is less than the price of half a sack of soybeans per hectare [assuming prices in July 2019]. Reasonably performing farms harvest 50, 60 sacks per hectare. With connectivity, they could increase yields by five or six sacks per hectare. It’s a profitable investment, but some are too shortsighted to realize it. They only think about the immediate expense, as the benefits are not always explicitly articulated in scientific research.

Could these technologies generate income concentration?
Today, less than 20% of farmers account for 80% of gross revenues in agriculture. The other 80% are left with the remaining 20%. These farmers earn very little income. So agriculture 4.0 could create inequalities in farming. The government needs to support connectivity for low-income farmers, who often cannot afford the investment. They will need capacity-building programs such as the ones implemented in Germany, India, China, and South Korea. Small farmers also need to take action for themselves. If investing on their own is impracticable, they can do so through cooperatives or associations. Agriculture 4.0 is an unstoppable trend, and those who fail to embrace it will be unable to survive.

Could it accelerate the rural exodus?
These technologies are actually being developed to fill existing gaps. Today, 87% of Brazil’s population lives in cities. No one wants to do the hard and dirty work of farming, come rain or sun. You have to milk the cows whether it’s a Sunday, a holiday or New Year’s Day. Who wants that kind of job? In Japan, a tractor operator earns as much as a university professor—and there is still a shortage of tractor operators. The solution is using autonomous vehicles and automation. Technology can address the shortage of labor willing to work on farms. It will also allow people to live in the city and operate their farms remotely, with occasional visits to the farm when necessary, but not for any ‘heavy lifting.’

Will there be jobs for everyone?
Automation has changed the face of employment in industry and retail, and in agriculture it will be no different. Half of the occupations available today are likely to be gone by 2050. Any jobs involving routine tasks will be filled by machines and robots using artificial intelligence algorithms that are better at performing those tasks than humans. A harvester replaces 100 manual workers. Is harvesting sugarcane a good job? No. It’s heavy labor. Sugarcane harvest workers need to be trained to operate harvesters. They need to learn how to perform more complex tasks. There is currently a shortage of farm labor with the skills to analyze data and understand processes. But even with these new occupations, there still won’t be enough jobs to go around. And that’s when we’ll need to discuss something bigger. Capitalism will need to become more inclusive and develop new ways of doing business that take humans and their needs into account, and coexist harmoniously with the environment.

What role are startups playing in modernizing agribusiness?
The farm modernization process is being led by large corporations that are developing technologies for agribusiness, but national research centers, universities, research hubs, and agribusiness startups—or agtechs—also play a key role. They are more agile and flexible, unlike the rigid structures that characterize major corporations or even incumbent small and medium-sized players. This creates a disruptive innovation environment. Agtechs also attract youth and women—two groups which today have a limited presence in agribusiness. In addition, today’s youth have grown up in a culture that is more open to technology and can quickly master new digital tools, such as artificial intelligence and algorithm logic. Agtechs are more open to listening to and gaining an understanding of the needs of small and medium-sized farms, which are often neglected by large corporations. They also offer more cost-effective and affordable solutions.

Can digital technology enhance eco-efficiency in agriculture?
This is a very important aspect. Technology will create transparency and place customers at the center of decisions. And consumers today want products that are high quality and sustainable, especially in European countries and, increasingly, in Asia. They will be able to track the entire product lifecycle by scanning a QR code. Were pesticides used responsibly? Does the supply chain cause water contamination, destroy biodiversity, or employ slave labor? Farmers will no longer be just farmers, but agents of environmental protection and will have to demonstrate that they are using resources in a responsible manner. Farmers who do things right will win market share, to the detriment of those who don’t.