According to a poll of 5,500 farmers conducted by McKinsey & Company, strong crop prices are providing farmers reason for cautious optimism despite economic turbulence. Over the next two years, 70% of farmers are positive about their profits, and 80% predict that they will either rise or remain steady. Farmers are embracing the changes head-on, experimenting in new fields, and using new tactics despite an uncertain future with supply chains affected by global crises. South America is an early adopter of digital channels, while North America and Europe take the lead in innovative agtech and Brazil in biological goods. The top three items that farmers anticipate buying online in the next two years are digital payments, farm equipment maintenance, and precision ag gear.
One of the findings of the survey by McKinsey shows that farmers are willing to innovate despite the macroeconomic uncertainty and the inflationary era. Indeed, according to the poll, 70% of farmers expect profits to remain stable or increase and many intend to try new products increasing their yield productivity to capture the current high crop price opportunity even if the risks of seeing an increased price of inputs remain.
The technology adoption varies widely by region. In fact, western countries are leading agtech adoption with farm management software being the most adopted followed by precision agriculture hardware. In the near future, farmers in South America are more willing to adopt new technologies contrary to Asia which has the lowest adoption rates.
Other technologies to take a significant place include remote sensing and sustainability-related tech (particularly in Europe, North America, and South America).
Discover the rest of the Global Farmer Insights 2022 by McKinsey here.
Image provided by Lyn Ong