June 9, 2022 • 29 mins
Michael Gomes of Topcon Agriculture leads a panel discussion about current and future trends in the agriculture industry and the resulting impact on farmers around the world. To learn more about 13 trends that are shaping the future of farming, download The Future of Food Production white paper at www.topconpositioning.com/futureoffood.
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Episode Transcript
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Speaker 1 (00:13):
Hello, I'm Mike Gomes , vice president of strategic
business development for Topconagriculture.
And I'm a guest host today onTopcon talks agriculture today.
I'm very excited about ourdiscussion and our guests.
Today's topic is about thefuture of food production
systems and a very interestingproject that was done by the
(00:35):
AEM, the association ofequipment manufacturers.
So we've got two guests today,the first of which is Kurt
blades and the second of whichis grant good from AGCO.
And so I'll let them introducethemselves.
Kurt, why don't you go first?
Speaker 2 (00:49):
Perfect.
Thanks Mike.
And thanks for having me on, uh,my name's Kurt blades.
I serve as senior vice presidentfor industry sectors and product
leadership for the associationof equipment manufacturers.
So by that role, that has meoverseeing the five sectors that
AEM represents ag construction,forestry, mining, and utilities.
But then that also gets meinvolved with some really
(01:10):
interesting projects likeworking with regulators and
policy makers to help makingsure that our products can be
sold and every mark in aroundthe world.
Speaker 1 (01:18):
Thanks very much for making the time to speak with us
and our listenership today andgrant, why don't you tell us a
little bit about what you'redoing at AGCO?
Speaker 3 (01:26):
Yeah.
Thanks Mike.
Uh, pleasure to be here.
So I am our, uh, director forwhat we call global smart ag
engineering.
Uh, smart ag is kind of ourbranch of engineering for, uh,
creating new value streams forAGCO.
So been with AGCO for 15 yearsand, uh, was born and raised on
a farm in, uh, Northeast Kansas,where we had diversified
livestock and cropping operationbeen passionate about ag my
(01:47):
whole life.
So really, really happy to behere today.
Talking about this, uh, uh,white paper from the AEM.
Speaker 1 (01:53):
Let's get into that a little bit.
Kurt, can you tell us a littlebit about how the future of food
production systems white papercame about?
Why did AEM put this together?
Speaker 2 (02:03):
You know, the association of equipment
manufacturers has for a numberof years had, uh, you know, a, a
desire to be in the thoughtleadership business, or we
wanted to make sure that we areprovided our members with, uh,
you know, good thinking pieces.
And we have got a structure thatallows us to happen.
One of these is called thefutures council.
So we actually, uh,representing, you know, the five
(02:25):
sectors that I referred toearlier, ag construction,
forestry, mining utility.
What we really wanted to do wasframe up really one of those
kind of bigger issues that arehappening within our industries.
So we can make sure that ourmembers are, uh, are able to
respond appropriately.
So the, today we're gonna betalking about the future of food
production study, but there's avery similar version of this
(02:47):
that we created for theconstruction side of our
business, the future ofbuildings.
And the idea on both of these isto look at the 10 year horizon
to say, what's gonna happenwithin our industry because of
technology that's happening orsocietal changes or policy or
you name it.
That really gives us a niceroadmap, uh, to, you know, to,
to recognize our world'schanging.
(03:07):
And the industries that werepresent are also gonna be
changing as well.
Speaker 1 (03:11):
Fantastic.
And so Kurt, how did you puttogether this group?
How did you put together thegroup of people that, that did
this?
Speaker 2 (03:18):
So what makes this kind of unique?
What AEM does really well is weget, we get groups of people
together, and there's lots ofdiscussions about, you know,
future looking topics.
I mean, you can't, you can findlots of amount that where people
pro prognosticating what thefuture's going to hold.
What makes this particular studyunique is the fact that we
assembled about 20 experts fromaround the industry representing
(03:42):
various AEM members, uh, thatwe're kind of hand selected by
either by their companies or, or, uh, or by us directly through
AEM that really have a pensionfor what the future is going to
hold, but also have a, uh, apretty good, uh, grasp on their
unique aspect of the industry.
So the process was these, uh,this group of kind of a think
(04:04):
tank got together over thecourse of really the last 18
months and discussed trends,ideas, put them down on paper,
debated'em as a group, andreally came up with what we're,
uh, what are we gonna be talkingabout here today, which were 13
trends that are really, uh, kindof immutable.
Those are things that are gonnashape our world and how Fu food
production is, uh, uh, is goingto change over the next 10
(04:25):
years.
Speaker 1 (04:26):
Great.
And grant, you've been involvedwith this group kind of since
the inception.
And so why don't you talk to usa little bit about your
perspective, both coming fromAGCO on the smart agriculture
side, and then how you saw the,the development of this white
paper?
Speaker 3 (04:41):
Sure.
Mike, so, um, like you say, I'vebeen involved with the, the, the
future of food discussions, uh,from the very beginning was
really an honor to, to be a partof the conversation.
And, and really, it was just alot of collaboration, a lot of
really good collaboration andleadership by the AEM to, uh,
take some methods from thefutures Institute, facilitated
by the AEM and get some of thosethought leaders from, uh,
(05:03):
various companies together to,to shape these trends and really
evolve, you know, from thosetrends into, into kind of what
that meant for, for our growers,for the ag industry.
I mean, ultimately for theequipment manufacturers.
So it was really interestingprocess to be a part of, uh,
really thought provoking andcertainly had a lot of, uh, good
discussion around these, uh,around these topics.
(05:25):
Um, one of the interestingthings I thought was there were
a lot of underlying trends, youknow, had these many points, but
, uh, kept kind of circling backaround to a lot of common
themes.
And I think you've done a goodjob today too, of, of, uh,
plucking out some of thosethemes for us to discuss.
Speaker 1 (05:40):
That's a great point grant.
So the white paper actually puttogether 13 different trends
that we had talked about.
And, and so I, I just tried toput some of those things
together in what we wouldconsider common themes.
And so I guess the one firstcommon theme that really jumped
out at me was really the idea ofdoing more with less.
(06:01):
And it's the idea that, youknow, over the next 10 years,
agriculturalists are gonna haveto produce more with a lighter
or less environmental impact aswell as optimization of water
use, as well as elements, a kindof the global demand for protein
grant, as you are working somuch with planters and certainly
coming from Kansas and a Kansasfarm, how do you see that trend
(06:22):
kind of fitting in?
Speaker 3 (06:24):
Sure.
So really Mike, you know, as welook at doing more with less,
that's really not a new conceptto, to our growers at all.
I mean, we've been doing thatfor, for centuries really, um,
in agriculture.
So like you mentioned, you know,here in the Midwest, uh,
certainly we have someconstraints with water.
We've got, uh, um, you know,always economics is, is a
challenge for our growers tryingto, trying to optimize things,
(06:45):
but really you look at the, theevolution over the next 10
years, we think, um, you'll seemore widespread adoption
probably of precisionagriculture, um, whether that's
variable rate technologies,variable hybrids, trying to get
the, you know, the best seed forthe, for the best acre or, you
know, technologies such as seaand spray where we're seeing,
you know, potential to reducechemical use of certain
(07:06):
herbicides in certainapplications by, you know, over
two thirds.
So really there's, there's a lotof opportunities to, to do more
with less.
I think two, you know, youmentioned the, the, uh, global
meat consumption increase and,you know, we look at the, the
expanding third world and the,the, this increasing standard of
living and really you have thisinteresting dichotomy where we
(07:29):
have more protein consumption inthose areas of the world.
But then in our more developednations, we've got maybe
alternative, uh, protein sourcesbeing consumed.
So really, you know, as we lookat that, there's gonna be more
demand for every acre to beproductive, because whether
it's, you know, using soy forprotein, for alternative, uh,
(07:49):
meats, or if it's, uh, feeding,you know, livestock and that
feed to gain ratio that we seethat it takes multiple pounds of
grain to raise one pound ofbeef.
Um, we've really got a, agrowing demand, um, with the
world's population expandingover the next 10 years or
continuing to expand, and a lotof, uh, challenge there for our
farmers to meet, which again iscertainly nothing new,
Speaker 1 (08:12):
Good stuff, good stuff.
Kurt, from the industry'sperspective, what was your take
on how these, some of thesethings were coming together and
the idea of doing more with lessor where you see that taking us
over the next 10 years?
Speaker 2 (08:24):
Well, I'll tell you the, uh, the biggest surprise
that I had in this wholeexercise when discussing the,
uh, the trends was the, the, theheavy discussion on water
scarcity.
And in fact, when we talkedabout what was the, the first
thing that came up, we could allagree on was that water is a
challenge.
And that was actually a littlebit surprising to me, but it,
(08:44):
but it absolutely makes sense.
I'm sitting in here in Wisconsinwhere, you know, if you look out
my window behind you, you see alot of green plants.
Uh, but if you're in California,you know, Mike, where, where
you're, where you are today,obviously there's regulations
that are coming daily aboutwater scarcity and doing, doing
more with less, or where grantis in, in Kansas.
(09:04):
And even some of those lands inWestern Kansas, where we've been
growing, uh, corn, wherenormally we hadn't in the past.
I think the water scarcity is avery, very real thing.
So that's a practical thing, butwe, the, but the general idea of
growing more with less is justabsolutely, uh, you know, again,
as, as grant said before,agriculture's been doing that
for centuries, uh, we've beendoing it for centuries because
(09:27):
farmers recognize that's the wayto be efficient.
Uh, we make a little bit moremoney because we spend a little
bit less on inputs.
Now, all of a sudden you putenvironmental constraints in
there, or pressure, uh, fromconsumers or even, uh, you know,
the need to do more with lessbecause of, because of water
scarcity, all of a sudden itopens up a pathway for
(09:50):
technology like we've never seenbefore.
So what normally was an economicdecision for a farmer to invest
in new technologies?
All of a sudden becomes a, uh, atriple bottom line.
They're gonna make a little bitof more money because they're
doing things more efficiently,but also because we're producing
more with less input, we've, uh,reduced our carbon footprint in
(10:11):
a pretty remarkable way.
And we're actually able to tellreally good story about, you
know, just feeding the world ina general, uh, a general, you
know, positive way becausepopulation is growing and
there's no more resources comingto our, you know, for us to grow
those crops on right now.
Speaker 1 (10:27):
That's pretty significant.
Uh, the other thing is justtalking a little bit about
really traceability and as we'recontinuing to produce more food,
fiber and fuel through renewableand sustainable sources like
agriculture, you know, we'retalking a little bit about
traceability and shorter supplychains and some of those kinds
of things.
And so Kurt, you want to talk alittle bit about how you see AAM
(10:50):
membership being affected bythis, or how this came out in
the paper?
Speaker 2 (10:55):
Well, what, what we started talking about was this
whole general idea of consumers,caring a little bit more about
where their food comes from.
This has been going on foryears, but what has happened and
what is gonna be happening inthe next 10 years is that the
technology is allowing thattraceability to exist.
Like it never has before.
So that, you know, whether it'sblockchain technology that
(11:17):
allows for a full transparencyof the supply chain or whether
it's because the sensortechnology that is on a tractor
today that wasn't there before,uh, that's all going up to the
cloud, doing other thingsdoesn't really matter.
The reasons the, the, thereality is we can do more
traceability now than we everhave been able to in the past.
And consumers are demanding itcouple that with this whole idea
(11:40):
of a shorter supply chain, whichis, you know, there's consumers
certainly want to know thattheir food they're consuming is,
is produced with the mostefficiently possible, the less,
uh, impact on the land.
And that also is, is includingtransportation costs and other
things like that.
So shortening that supply chainmay mean, you know, uh, things,
whether they're grown invertically or, or produced more
(12:02):
locally, uh, because of consumerdemands or because efficiency
demands.
It becomes very interesting tosee how this, how this comes
into play.
So how does this relate to AEMmembers?
Well, Topcon as an AEM memberand Adco as an AEM member are
very much at the forefront ofthis technology that, uh, uh,
farmers are implementing tocollect that data at the very
(12:22):
field level, uh, whether it'splanting or spraying or
harvesting that data starts atthe field level and AEM members
are smack data in the center ofthat entire conversation.
Speaker 1 (12:34):
Absolutely.
And that's one of the, probablythe biggest things that I see in
the industry is it's that datathat becomes basically just
documentation of practice and,and most farmers are doing
absolutely the right things, theright things for the
environment, as well as for theeconomics of their, of their,
their business.
And so you certainly see thatgrant, how do you see it because
(12:55):
you are, you know, being therein Kansas and, and certainly in
the line of business that youare, you, you get a front row
view of a lot of these thingsand particularly as they're
moving forward.
Speaker 3 (13:05):
Yeah, absolutely.
Mike, so, so I really agree witha lot of what Kurt said and, and
, you know, certainly this isnot a brand new trend.
I think we've been seeingconsumers wanna be closer to
their food for, for severalyears now we saw the pandemic
really press the accelerator onthat.
I mean, for generations, wehaven't really been food
insecure for most people in theus.
And I think for the first timefor a lot of people, we saw the
(13:27):
shelves bear, you know, in a lotof areas, especially in the meat
aisle.
So I think you saw a lot ofpeople express, you know,
wanting to be closer to that,uh, food security closer to, to
that by, you know, you saw locallocker appointments being out
two years during the pandemic,you saw, you know, local farmers
phones ringing off the hook forindividual animals.
You saw freezers deep freezersbeing in shortage because people
(13:50):
wanted to, to know that they hadmeat on hand for their family
kind when a freezer full.
So, so I think that's reallyinteresting.
I think the, the traceabilitypiece, certainly too, just to,
you know, aside from just beingcloser to, to your meat and, or
closer to your, to your food andyour produce, you know, the
traceability piece and reallythat accountability that, that
(14:10):
builds into the system, I thinkis gonna be a good thing,
whether it's vegetables, romainelettuce, uh, um, you know, I
think we've seen someimprovements there in the recall
processes and procedures.
That's something thattraceability certainly enables
to be much more efficient sothat we're not, uh, maybe
scrapping, you know, tons andtons and tons of, uh, of produce
, uh, when we could target those, uh, recalls much more
(14:32):
specifically if there's aproblem identified in the food
supply chain.
So, uh, certainly an area that Ithink is gonna evolve, certainly
an area that, uh, there is a lotof opportunity for value add and
, uh, value preservation, uh,through the supply chain.
Speaker 1 (14:45):
Right.
And I, I think you did a greatjob of touching base on one of
the things that we certainly seeand that's elements of the
digital divide and howimportance connectivity is to
our industry and to outdoorindustries, as they're beginning
to use some of these tools.
Do you have any thoughts on thatone?
Speaker 3 (15:01):
Yeah, I really do.
I mean, really connectivity's, Ithink certainly an enabler for a
lot of this traceability, and aswe see that pull, connectivity's
just gonna be more and moreimportant.
We look at, uh, you know, beingable to pass that data from the
point it's collected to thecloud, to these downstream off
board systems to preserve thatdata.
Certainly, you know, as we see,you know, rural broadband or
(15:23):
access to, uh, cellular data,you know, becoming problems, uh,
in certain areas, I think we'regonna see that shrink as we
expand our infrastructure in theus, uh, and really the need is
gonna be there.
It's, it's not gonna be a matterof if you do it, it's, it's,
it's gonna be a requirement.
I think in a lot of cases andwhether that be from the
economic side, like we see incertain cases, maybe with
(15:44):
Walmart contracts, things likethat, or potentially even from
the regulatory side, it's gonnabe really important to, to have
that data synced up in lifetimefor, you know, the, the use, uh,
throughout the, the supplychain.
Speaker 1 (15:58):
Excellent.
And, and Kurt in your capacity,you talk to agriculture, but as
well as other industries, talkto us a little bit about how you
see it from the manufacturerside and, and how you see
connectivity in the digitaldivide coming together.
Speaker 2 (16:10):
Well, you know, first of all, I think, you know, here
in the United States, we'vebeen, you know, pretty blessed
with a, uh, a recentinfrastructure bill that puts a
whole lot of emphasis on helpingto close that digital divide,
uh, both, uh, you know, between,you know, haves and haves nots
of, of connectivity, but morespecifically, and I think
relevant for your audience hereis a focus in, on rural, uh,
(16:33):
areas and rural broadbandspecifically, uh, you know,
grant mentioned, uh, you know, alittle bit about having wireless
connectivity.
I think you wanna hit on thatjust a little bit more is that,
uh, you know, where, where we asam and pretty, pretty adamant in
anyone that will listen, willtalk about how, you know,
wireless or excuse me, broadbandin rural areas is not limited to
(16:54):
the anchor institutions.
It really needs to be wirelessin the field, because when you
think about all of thetechnologies that we've talked
about so far today on thispodcast, really, uh, just
explode when you have constanton, uh, wireless connectivity
and when a, when a, uh, atractor or a combine or sprayer
or whatever it is constantly,uh, communicating into the, into
(17:17):
the cloud.
It can, it's amazing what we'llbe able to, to do with that,
whether it's our artificialintelligence or, uh, other
things that can come, come as aresult from that.
But having said that thosetechnologies can only happen if
that digital divide is met.
And it seems like there's a lotof attention being paid to that.
So I feel optimistic in the next10 years, we're gonna really
(17:37):
close that gap in a big way.
So that gets the connectivitypiece in here.
But the other piece that, that,uh, we also have to address is,
uh, you know, that that mightrequire an upgrade of, uh, of
equipment.
And whether it's an upgrade oftractors, combines sprayers,
whatever to take full advantageof this technology.
And so that's the second pieceof that is making sure that the
(17:59):
business models of a farmer are,are enough to be able to support
purchasing new equipment, andthat there are ways in which,
uh, farmers can access thisequipment and access all of this
technology that really lives upto the promise of producing more
with less.
Speaker 3 (18:14):
Those are great points, Kurt.
And I think, you know, it's nottoo just the, the presence of
the coverage, it's the qualityand the size of the pipeline
too, as we look at 5g and theamount of data that we're, you
know, generating through machinelearning through all these new
data acquisition technologiesand really putting more and
better decision tools in thefarmer's hands it's, uh, this
(18:35):
infrastructure's really, reallygonna be a big deal.
Speaker 2 (18:38):
Yeah.
It's amazing how, uh, whenhaving these conversations early
on and Mike, you're veryfamiliar with this when talking
with, with regulators aboutrural broadband is that, uh, you
know, those that aren't familiarwith agriculture, think of it as
a down link.
Like, how do I make sure I canget, you know, Netflix to play
in my, in my tractor cabs?
Like, no, that's not what wewant.
We want up and down speeds thesame, uh, the same speed that
(19:01):
pipe's gotta be big, but mostimportantly, it's gotta be
constant because the minute youlose that little bit of
connectivity in a blind spot,you've kind of lost some of the,
the real benefits that we'retrying to gain with this
technology.
So this digital divide is aninteresting one for us to dive
into it holds a tremendousamount of promise when we get it
solved though.
Speaker 1 (19:21):
Absolutely.
And I guess that's one of thethings that I see is, is that,
you know, with the era of smartimplements, which we see we're
very much in the middle of now.
And so between those smartimplements connected to a
tractor, oftentimes using theISO bus standard, um, and
creating that data, it's, it'sdoing some unique things, right?
And, and so it might not be ahundred percent dependent on
(19:42):
connectivity because we're outwhat they call on the edge where
the tractor implementcombination is working, but
certainly you can see wherethat's going grant.
Do you wanna talk a little bitabout that, how you see pieces
of that coming together?
Speaker 3 (19:54):
Well, sure.
Mike, I think we're starting to,starting to realize, as you
mentioned, you know, implementsgetting smarter.
I mean, a lot of people, I thinkview ACO as a tractor company
traditionally, and, you know,sometimes we say inside, you
know, nobody goes tractoring.
So it's really important to havethat implement, uh, being smart
and, and really being able to,to play a more active role in
driving the operation, whetherthat be through things like, uh,
(20:17):
tractor implement management,um, or being, you know, much
more smart in the agronomicsense of collecting data.
Um, maybe through a single passin the field, rather than having
to go grid sampling, or spendadditional time, labor and
resources that are already inshort supply to gather some of
that data and make betterdecisions and, and circle back
(20:37):
around to that doing more withless being able to utilize, you
know, better decision makingtools generated with, uh, you
know, new information with everypass in the field.
So, yeah, certainly I think, uh,smart implements is, is gonna be
a big thing as we look forwardin the future and, and, uh,
certainly an opportunity forgrowers to, to increase their
return investment and for, uh,equipment manufacturers to
(20:59):
provide those solutions
Speaker 1 (21:00):
Coming back to one of the things that Kurt brought up
right, is Kurt.
You were beginning to touch alittle bit on how business
models are changing and, andreally how we're beginning to
see this, some of those things,right?
Whether that's farmers adjustingto, you know, increases in
emission or emission inregulations, things like that,
elements of the connectivitygap, or, or even just how
(21:22):
farming is goes about as abusiness.
And so can you tell us a littlebit about some of the things
that came up out of thatconversations as part of this
project?
Speaker 2 (21:32):
Well, that's fair.
I'm, I'm a farm kid fromMissouri and farming, you know,
as we've kind of alluded tobefore the general premise of
farming, the business model offarming has not changed much
really in the last, you know,century.
Uh, really since the foodrevolutions, the market is ripe
for disruption right now, newbusiness models, whether that's
how a farmer accesses theirequipment or how they access the
(21:55):
technology.
I think we're, I think we'regonna see some, some different
things show up.
In fact, you're starting to seewhether it's, uh, uh,
investments that are being madeby startup companies into things
that are, you know, somebodycould be considered novel here
in the United States.
Or if you look at other areassuch as India, where there is a,
a push for, uh, ways in whichtractor ownership is changing, I
(22:18):
think, you know, the, thefuture's wide open as to what
that, what those business modelsare going to look like.
I think those are driven reallyby a number of kind of
underlying factors.
And that's how we got to thisparticular point, uh, with the,
with the futures council.
One of those is, is if you lookat the dollars that are flowing
into food production right nowfrom the investment community is
(22:41):
astounding.
They're flowing into those, youknow, before the pandemic.
But as grand alluded to earlier,the pandemic kind of put a
bright, shiny spotlight on theag industry, which is all of a
sudden caused more money tofocus in on agriculture.
But you couple that with theenvironmental pressures that are
being placed on the ag industry,and then you also, uh, add to
(23:03):
that, just this idea that, uh,that investment dollars are
always looking for industrieswhere efficiencies can be gained
largely because of the newtechnology.
I think we're seeing that that'swhy this whole new business
model really rises to the, tothe, to the front of a, of a
very interesting trend.
I don't know what it's gonnalook like.
You can't point to one inparticular, it's going to, uh,
(23:25):
to, to, to make the, make themost of it.
If that's, you know, carbonmarkets for a farmer to
participate in, or a, adifferent way in which a, uh, a
farmer accesses the, the, thetractor, or even the technology
that may, may be off balancesheet, who knows that we do know
that there's gonna be a lot,there's a lot of attention being
paid to this right now, and it'sgonna be different in the next
(23:45):
10 and 20 years and beyond.
Speaker 1 (23:48):
Absolutely.
And that was probably one of thebiggest things that we saw, uh,
in the discussions, or at leastthat I saw as a member of the
panel and in the discussions wasjust really looking at how much,
how land ownership models inboth the developed and the
developing world, how capitalasset models in the developing
world, how the service economyelements of things like sea and
(24:08):
spray and elements of yourconsultant, your consultant,
working with coordinated, smartequipment, working with the
delivery of on time servicesand, and really the logistics
challenges and opportunitiesthat those present, and then how
that begins to fit, whetherthat's for professional
ownership or even some of themore public domain pieces and,
(24:31):
and just a number of thingsthere.
Uh, how do you see it from theAGCO perspective?
Are you, you seeing some ofthese trends grant?
Speaker 3 (24:37):
Yeah, I certainly think so, Mike, I mean, you
touched on a lot of interestingpoints there, but I think, you
know, the flexibility I thinkis, is gonna be the big thing,
you know, I think flexibilityand, and risk management too.
I think as you look at, uh, farmoperations, you know, it's
certainly a, a high risk highreward business these days.
I think as we see operationsgetting bigger, we see
(24:57):
competition for land, you know,increasing in certain areas,
especially with pressure.
Um, like Kurt mentioned, youknow, with different investors,
you know, ownership models, uh,a lot of absentee landowners.
So really there's a lot ofpressure there to, to gain a
return on investment.
So things like guaranteeduptime, you know, uh, maybe
power by the hour, new ownershipmodels to support these things.
(25:20):
And again, you know, going backto the labor issue that, uh,
we're seeing on a lot of farms,you know, looking at how we can
be smarter with how we work, youknow, whether that's, uh, you
know, gaining access to, to moremachinery during peak times.
Um, or if that machine comeswith an operator, maybe through
a contract service, things likethat.
And I think there's a lot of,lot of different, uh,
opportunities as we lookforward.
(25:41):
And I think, um, again, you'llsee those under underlying needs
, uh, you know, met with the,the flexibility and, and
hopefully some risk mitigationoff offered for our growers as
well.
Speaker 1 (25:51):
Absolutely.
And so grant, why don't you talka little bit about, I mean, this
is obviously a passionateopportunity for you.
You've been involved in thiseffort of making this white
paper for the last couple ofyears.
If there was one thing that youreally, uh, and unique insight
that you got out of those 13different trends, what, what
jumped out at you?
Speaker 3 (26:09):
Well, you know, it, the whole, thing's been
interesting to me, you know,Mike, and I think, like we said,
there's a lot of underlyingthemes, but I think the real
underlying theme for me is thatagriculture will continue to
adapt.
We've got a growing population.
I think I've heard statistics,you know, something along the
lines of, we need to raise asmuch food between now and 2050
as we have for all of humanhistory, just because of those
(26:32):
multiplication effects.
We've mentioned with proteinconsumption, uh, with the world
population, you know, this is abig deal, a big challenge.
So, you know, limited waterresources, limited land
resources, limited laborresources, um, especially
trained labor.
You know, we've got a, a bighill to climb and I'm sure that
agriculture is going to rise tothe challenge.
Our farmers are gonna rise tothe challenge.
(26:52):
Our equipment manufacturers aregonna rise to the challenge to
feed this growing population.
So certainly that's what I'mpassionate about to contributing
to.
And, and I think this, uh, uh,white paper does a great job of,
uh, providing some thoughtprovoking insights to, uh, to
set the stage, to meet thosechallenges.
Speaker 2 (27:09):
Well, I'd say I've, I've two things.
First is, uh, the one that wasthe frankly the biggest eye
opener for me was how consistenteverybody was on these divergent
opinions, all coming together toagree on, uh, a few, uh, points
that were very important.
The one that rose to the top,the quickest was the biggest
(27:30):
surprise to me was waterscarcity.
Uh, and how much of an impactthat was going to have.
And this was two years ago kindof before it started even making
headlines in a big way with, uh,with the allocations we're
seeing, even in California, youknow, in the last, you know,
two, three weeks.
Uh, so that was a, that was oneof the biggest surprises to me,
but I would tell you theoverarching thing that makes me
very proud is I'm a farm kidfrom Missouri, and I get very
(27:53):
passionate about this type ofstuff.
And, uh, it's very easy for meto look at this paper and say,
this is difficult for those ofus that are incumbents in the
industry.
Uh, equipment manufacturers say,this is gonna change our world.
And you know, it's not gonna bebusiness as usual, man.
I look at the complete oppositeway and I love the conversations
around sustainability and usingtechnology to feed the
(28:15):
population in a very sustainableway, because we've got this.
And if you think about howexciting it is to see how much
change is happening, just righton the cusp of, uh, you know, 5,
10, 20 years from now, thisindustry's gonna look very
different.
And it's very exciting for thoseof us that are, you know, have
been involved in agriculture,all of our lives.
(28:37):
And we've been waiting for thismoment to finally have a reason
to, to prove that we've got the,uh, we're up for the challenge.
And I think all of ourmanufacturers are excited to
kind of get behind some of thesetrends, some of these ideas to
say that this is not a challenge, uh, that we're gonna take
lightly, but it's one that we'regonna approach with enthusiasm,
and we're gonna approach it with, uh, with the right amount of,
(28:58):
uh, of, of thought because thetechnology does allow us to do
some pretty amazing things.
Speaker 4 (29:03):
We've been talking about AEM, the future of food
production, white paper.
And if you'd like to get yourown copy to learn more about the
13 different trends, you canvisit Topcon
positioning.com/future of food.
That's Topcon,positioning.com/future of food
Speaker 1 (29:25):
Edge.
Certainly like to thank both ofour guests, both grant good from
AGCO, as well as Kurt bladesfrom the association of
equipment manufacturers and AEM.
If you've enjoyed this podcast,please remember to like share
and subscribe to Topcon tops,agriculture on Spotify, apple
podcast, Amazon music, orwherever you get your podcast.
Hello, I'm Mike Gomes , vice president of strategic
business development for Topconagriculture.
And I'm a guest host today onTopcon talks agriculture today.
I'm very excited about ourdiscussion and our guests.
Today's topic is about thefuture of food production
systems and a very interestingproject that was done by the
(00:35):
AEM, the association ofequipment manufacturers.
So we've got two guests today,the first of which is Kurt
blades and the second of whichis grant good from AGCO.
And so I'll let them introducethemselves.
Kurt, why don't you go first?
Speaker 2 (00:49):
Perfect.
Thanks Mike.
And thanks for having me on, uh,my name's Kurt blades.
I serve as senior vice presidentfor industry sectors and product
leadership for the associationof equipment manufacturers.
So by that role, that has meoverseeing the five sectors that
AEM represents ag construction,forestry, mining, and utilities.
But then that also gets meinvolved with some really
(01:10):
interesting projects likeworking with regulators and
policy makers to help makingsure that our products can be
sold and every mark in aroundthe world.
Speaker 1 (01:18):
Thanks very much for making the time to speak with us
and our listenership today andgrant, why don't you tell us a
little bit about what you'redoing at AGCO?
Speaker 3 (01:26):
Yeah.
Thanks Mike.
Uh, pleasure to be here.
So I am our, uh, director forwhat we call global smart ag
engineering.
Uh, smart ag is kind of ourbranch of engineering for, uh,
creating new value streams forAGCO.
So been with AGCO for 15 yearsand, uh, was born and raised on
a farm in, uh, Northeast Kansas,where we had diversified
livestock and cropping operationbeen passionate about ag my
(01:47):
whole life.
So really, really happy to behere today.
Talking about this, uh, uh,white paper from the AEM.
Speaker 1 (01:53):
Let's get into that a little bit.
Kurt, can you tell us a littlebit about how the future of food
production systems white papercame about?
Why did AEM put this together?
Speaker 2 (02:03):
You know, the association of equipment
manufacturers has for a numberof years had, uh, you know, a, a
desire to be in the thoughtleadership business, or we
wanted to make sure that we areprovided our members with, uh,
you know, good thinking pieces.
And we have got a structure thatallows us to happen.
One of these is called thefutures council.
So we actually, uh,representing, you know, the five
(02:25):
sectors that I referred toearlier, ag construction,
forestry, mining utility.
What we really wanted to do wasframe up really one of those
kind of bigger issues that arehappening within our industries.
So we can make sure that ourmembers are, uh, are able to
respond appropriately.
So the, today we're gonna betalking about the future of food
production study, but there's avery similar version of this
(02:47):
that we created for theconstruction side of our
business, the future ofbuildings.
And the idea on both of these isto look at the 10 year horizon
to say, what's gonna happenwithin our industry because of
technology that's happening orsocietal changes or policy or
you name it.
That really gives us a niceroadmap, uh, to, you know, to,
to recognize our world'schanging.
(03:07):
And the industries that werepresent are also gonna be
changing as well.
Speaker 1 (03:11):
Fantastic.
And so Kurt, how did you puttogether this group?
How did you put together thegroup of people that, that did
this?
Speaker 2 (03:18):
So what makes this kind of unique?
What AEM does really well is weget, we get groups of people
together, and there's lots ofdiscussions about, you know,
future looking topics.
I mean, you can't, you can findlots of amount that where people
pro prognosticating what thefuture's going to hold.
What makes this particular studyunique is the fact that we
assembled about 20 experts fromaround the industry representing
(03:42):
various AEM members, uh, thatwe're kind of hand selected by
either by their companies or, or, uh, or by us directly through
AEM that really have a pensionfor what the future is going to
hold, but also have a, uh, apretty good, uh, grasp on their
unique aspect of the industry.
So the process was these, uh,this group of kind of a think
(04:04):
tank got together over thecourse of really the last 18
months and discussed trends,ideas, put them down on paper,
debated'em as a group, andreally came up with what we're,
uh, what are we gonna be talkingabout here today, which were 13
trends that are really, uh, kindof immutable.
Those are things that are gonnashape our world and how Fu food
production is, uh, uh, is goingto change over the next 10
(04:25):
years.
Speaker 1 (04:26):
Great.
And grant, you've been involvedwith this group kind of since
the inception.
And so why don't you talk to usa little bit about your
perspective, both coming fromAGCO on the smart agriculture
side, and then how you saw the,the development of this white
paper?
Speaker 3 (04:41):
Sure.
Mike, so, um, like you say, I'vebeen involved with the, the, the
future of food discussions, uh,from the very beginning was
really an honor to, to be a partof the conversation.
And, and really, it was just alot of collaboration, a lot of
really good collaboration andleadership by the AEM to, uh,
take some methods from thefutures Institute, facilitated
by the AEM and get some of thosethought leaders from, uh,
(05:03):
various companies together to,to shape these trends and really
evolve, you know, from thosetrends into, into kind of what
that meant for, for our growers,for the ag industry.
I mean, ultimately for theequipment manufacturers.
So it was really interestingprocess to be a part of, uh,
really thought provoking andcertainly had a lot of, uh, good
discussion around these, uh,around these topics.
(05:25):
Um, one of the interestingthings I thought was there were
a lot of underlying trends, youknow, had these many points, but
, uh, kept kind of circling backaround to a lot of common
themes.
And I think you've done a goodjob today too, of, of, uh,
plucking out some of thosethemes for us to discuss.
Speaker 1 (05:40):
That's a great point grant.
So the white paper actually puttogether 13 different trends
that we had talked about.
And, and so I, I just tried toput some of those things
together in what we wouldconsider common themes.
And so I guess the one firstcommon theme that really jumped
out at me was really the idea ofdoing more with less.
(06:01):
And it's the idea that, youknow, over the next 10 years,
agriculturalists are gonna haveto produce more with a lighter
or less environmental impact aswell as optimization of water
use, as well as elements, a kindof the global demand for protein
grant, as you are working somuch with planters and certainly
coming from Kansas and a Kansasfarm, how do you see that trend
(06:22):
kind of fitting in?
Speaker 3 (06:24):
Sure.
So really Mike, you know, as welook at doing more with less,
that's really not a new conceptto, to our growers at all.
I mean, we've been doing thatfor, for centuries really, um,
in agriculture.
So like you mentioned, you know,here in the Midwest, uh,
certainly we have someconstraints with water.
We've got, uh, um, you know,always economics is, is a
challenge for our growers tryingto, trying to optimize things,
(06:45):
but really you look at the, theevolution over the next 10
years, we think, um, you'll seemore widespread adoption
probably of precisionagriculture, um, whether that's
variable rate technologies,variable hybrids, trying to get
the, you know, the best seed forthe, for the best acre or, you
know, technologies such as seaand spray where we're seeing,
you know, potential to reducechemical use of certain
(07:06):
herbicides in certainapplications by, you know, over
two thirds.
So really there's, there's a lotof opportunities to, to do more
with less.
I think two, you know, youmentioned the, the, uh, global
meat consumption increase and,you know, we look at the, the
expanding third world and the,the, this increasing standard of
living and really you have thisinteresting dichotomy where we
(07:29):
have more protein consumption inthose areas of the world.
But then in our more developednations, we've got maybe
alternative, uh, protein sourcesbeing consumed.
So really, you know, as we lookat that, there's gonna be more
demand for every acre to beproductive, because whether
it's, you know, using soy forprotein, for alternative, uh,
(07:49):
meats, or if it's, uh, feeding,you know, livestock and that
feed to gain ratio that we seethat it takes multiple pounds of
grain to raise one pound ofbeef.
Um, we've really got a, agrowing demand, um, with the
world's population expandingover the next 10 years or
continuing to expand, and a lotof, uh, challenge there for our
farmers to meet, which again iscertainly nothing new,
Speaker 1 (08:12):
Good stuff, good stuff.
Kurt, from the industry'sperspective, what was your take
on how these, some of thesethings were coming together and
the idea of doing more with lessor where you see that taking us
over the next 10 years?
Speaker 2 (08:24):
Well, I'll tell you the, uh, the biggest surprise
that I had in this wholeexercise when discussing the,
uh, the trends was the, the, theheavy discussion on water
scarcity.
And in fact, when we talkedabout what was the, the first
thing that came up, we could allagree on was that water is a
challenge.
And that was actually a littlebit surprising to me, but it,
(08:44):
but it absolutely makes sense.
I'm sitting in here in Wisconsinwhere, you know, if you look out
my window behind you, you see alot of green plants.
Uh, but if you're in California,you know, Mike, where, where
you're, where you are today,obviously there's regulations
that are coming daily aboutwater scarcity and doing, doing
more with less, or where grantis in, in Kansas.
(09:04):
And even some of those lands inWestern Kansas, where we've been
growing, uh, corn, wherenormally we hadn't in the past.
I think the water scarcity is avery, very real thing.
So that's a practical thing, butwe, the, but the general idea of
growing more with less is justabsolutely, uh, you know, again,
as, as grant said before,agriculture's been doing that
for centuries, uh, we've beendoing it for centuries because
(09:27):
farmers recognize that's the wayto be efficient.
Uh, we make a little bit moremoney because we spend a little
bit less on inputs.
Now, all of a sudden you putenvironmental constraints in
there, or pressure, uh, fromconsumers or even, uh, you know,
the need to do more with lessbecause of, because of water
scarcity, all of a sudden itopens up a pathway for
(09:50):
technology like we've never seenbefore.
So what normally was an economicdecision for a farmer to invest
in new technologies?
All of a sudden becomes a, uh, atriple bottom line.
They're gonna make a little bitof more money because they're
doing things more efficiently,but also because we're producing
more with less input, we've, uh,reduced our carbon footprint in
(10:11):
a pretty remarkable way.
And we're actually able to tellreally good story about, you
know, just feeding the world ina general, uh, a general, you
know, positive way becausepopulation is growing and
there's no more resources comingto our, you know, for us to grow
those crops on right now.
Speaker 1 (10:27):
That's pretty significant.
Uh, the other thing is justtalking a little bit about
really traceability and as we'recontinuing to produce more food,
fiber and fuel through renewableand sustainable sources like
agriculture, you know, we'retalking a little bit about
traceability and shorter supplychains and some of those kinds
of things.
And so Kurt, you want to talk alittle bit about how you see AAM
(10:50):
membership being affected bythis, or how this came out in
the paper?
Speaker 2 (10:55):
Well, what, what we started talking about was this
whole general idea of consumers,caring a little bit more about
where their food comes from.
This has been going on foryears, but what has happened and
what is gonna be happening inthe next 10 years is that the
technology is allowing thattraceability to exist.
Like it never has before.
So that, you know, whether it'sblockchain technology that
(11:17):
allows for a full transparencyof the supply chain or whether
it's because the sensortechnology that is on a tractor
today that wasn't there before,uh, that's all going up to the
cloud, doing other thingsdoesn't really matter.
The reasons the, the, thereality is we can do more
traceability now than we everhave been able to in the past.
And consumers are demanding itcouple that with this whole idea
(11:40):
of a shorter supply chain, whichis, you know, there's consumers
certainly want to know thattheir food they're consuming is,
is produced with the mostefficiently possible, the less,
uh, impact on the land.
And that also is, is includingtransportation costs and other
things like that.
So shortening that supply chainmay mean, you know, uh, things,
whether they're grown invertically or, or produced more
(12:02):
locally, uh, because of consumerdemands or because efficiency
demands.
It becomes very interesting tosee how this, how this comes
into play.
So how does this relate to AEMmembers?
Well, Topcon as an AEM memberand Adco as an AEM member are
very much at the forefront ofthis technology that, uh, uh,
farmers are implementing tocollect that data at the very
(12:22):
field level, uh, whether it'splanting or spraying or
harvesting that data starts atthe field level and AEM members
are smack data in the center ofthat entire conversation.
Speaker 1 (12:34):
Absolutely.
And that's one of the, probablythe biggest things that I see in
the industry is it's that datathat becomes basically just
documentation of practice and,and most farmers are doing
absolutely the right things, theright things for the
environment, as well as for theeconomics of their, of their,
their business.
And so you certainly see thatgrant, how do you see it because
(12:55):
you are, you know, being therein Kansas and, and certainly in
the line of business that youare, you, you get a front row
view of a lot of these thingsand particularly as they're
moving forward.
Speaker 3 (13:05):
Yeah, absolutely.
Mike, so, so I really agree witha lot of what Kurt said and, and
, you know, certainly this isnot a brand new trend.
I think we've been seeingconsumers wanna be closer to
their food for, for severalyears now we saw the pandemic
really press the accelerator onthat.
I mean, for generations, wehaven't really been food
insecure for most people in theus.
And I think for the first timefor a lot of people, we saw the
(13:27):
shelves bear, you know, in a lotof areas, especially in the meat
aisle.
So I think you saw a lot ofpeople express, you know,
wanting to be closer to that,uh, food security closer to, to
that by, you know, you saw locallocker appointments being out
two years during the pandemic,you saw, you know, local farmers
phones ringing off the hook forindividual animals.
You saw freezers deep freezersbeing in shortage because people
(13:50):
wanted to, to know that they hadmeat on hand for their family
kind when a freezer full.
So, so I think that's reallyinteresting.
I think the, the traceabilitypiece, certainly too, just to,
you know, aside from just beingcloser to, to your meat and, or
closer to your, to your food andyour produce, you know, the
traceability piece and reallythat accountability that, that
(14:10):
builds into the system, I thinkis gonna be a good thing,
whether it's vegetables, romainelettuce, uh, um, you know, I
think we've seen someimprovements there in the recall
processes and procedures.
That's something thattraceability certainly enables
to be much more efficient sothat we're not, uh, maybe
scrapping, you know, tons andtons and tons of, uh, of produce
, uh, when we could target those, uh, recalls much more
(14:32):
specifically if there's aproblem identified in the food
supply chain.
So, uh, certainly an area that Ithink is gonna evolve, certainly
an area that, uh, there is a lotof opportunity for value add and
, uh, value preservation, uh,through the supply chain.
Speaker 1 (14:45):
Right.
And I, I think you did a greatjob of touching base on one of
the things that we certainly seeand that's elements of the
digital divide and howimportance connectivity is to
our industry and to outdoorindustries, as they're beginning
to use some of these tools.
Do you have any thoughts on thatone?
Speaker 3 (15:01):
Yeah, I really do.
I mean, really connectivity's, Ithink certainly an enabler for a
lot of this traceability, and aswe see that pull, connectivity's
just gonna be more and moreimportant.
We look at, uh, you know, beingable to pass that data from the
point it's collected to thecloud, to these downstream off
board systems to preserve thatdata.
Certainly, you know, as we see,you know, rural broadband or
(15:23):
access to, uh, cellular data,you know, becoming problems, uh,
in certain areas, I think we'regonna see that shrink as we
expand our infrastructure in theus, uh, and really the need is
gonna be there.
It's, it's not gonna be a matterof if you do it, it's, it's,
it's gonna be a requirement.
I think in a lot of cases andwhether that be from the
economic side, like we see incertain cases, maybe with
(15:44):
Walmart contracts, things likethat, or potentially even from
the regulatory side, it's gonnabe really important to, to have
that data synced up in lifetimefor, you know, the, the use, uh,
throughout the, the supplychain.
Speaker 1 (15:58):
Excellent.
And, and Kurt in your capacity,you talk to agriculture, but as
well as other industries, talkto us a little bit about how you
see it from the manufacturerside and, and how you see
connectivity in the digitaldivide coming together.
Speaker 2 (16:10):
Well, you know, first of all, I think, you know, here
in the United States, we'vebeen, you know, pretty blessed
with a, uh, a recentinfrastructure bill that puts a
whole lot of emphasis on helpingto close that digital divide,
uh, both, uh, you know, between,you know, haves and haves nots
of, of connectivity, but morespecifically, and I think
relevant for your audience hereis a focus in, on rural, uh,
(16:33):
areas and rural broadbandspecifically, uh, you know,
grant mentioned, uh, you know, alittle bit about having wireless
connectivity.
I think you wanna hit on thatjust a little bit more is that,
uh, you know, where, where we asam and pretty, pretty adamant in
anyone that will listen, willtalk about how, you know,
wireless or excuse me, broadbandin rural areas is not limited to
(16:54):
the anchor institutions.
It really needs to be wirelessin the field, because when you
think about all of thetechnologies that we've talked
about so far today on thispodcast, really, uh, just
explode when you have constanton, uh, wireless connectivity
and when a, when a, uh, atractor or a combine or sprayer
or whatever it is constantly,uh, communicating into the, into
(17:17):
the cloud.
It can, it's amazing what we'llbe able to, to do with that,
whether it's our artificialintelligence or, uh, other
things that can come, come as aresult from that.
But having said that thosetechnologies can only happen if
that digital divide is met.
And it seems like there's a lotof attention being paid to that.
So I feel optimistic in the next10 years, we're gonna really
(17:37):
close that gap in a big way.
So that gets the connectivitypiece in here.
But the other piece that, that,uh, we also have to address is,
uh, you know, that that mightrequire an upgrade of, uh, of
equipment.
And whether it's an upgrade oftractors, combines sprayers,
whatever to take full advantageof this technology.
And so that's the second pieceof that is making sure that the
(17:59):
business models of a farmer are,are enough to be able to support
purchasing new equipment, andthat there are ways in which,
uh, farmers can access thisequipment and access all of this
technology that really lives upto the promise of producing more
with less.
Speaker 3 (18:14):
Those are great points, Kurt.
And I think, you know, it's nottoo just the, the presence of
the coverage, it's the qualityand the size of the pipeline
too, as we look at 5g and theamount of data that we're, you
know, generating through machinelearning through all these new
data acquisition technologiesand really putting more and
better decision tools in thefarmer's hands it's, uh, this
(18:35):
infrastructure's really, reallygonna be a big deal.
Speaker 2 (18:38):
Yeah.
It's amazing how, uh, whenhaving these conversations early
on and Mike, you're veryfamiliar with this when talking
with, with regulators aboutrural broadband is that, uh, you
know, those that aren't familiarwith agriculture, think of it as
a down link.
Like, how do I make sure I canget, you know, Netflix to play
in my, in my tractor cabs?
Like, no, that's not what wewant.
We want up and down speeds thesame, uh, the same speed that
(19:01):
pipe's gotta be big, but mostimportantly, it's gotta be
constant because the minute youlose that little bit of
connectivity in a blind spot,you've kind of lost some of the,
the real benefits that we'retrying to gain with this
technology.
So this digital divide is aninteresting one for us to dive
into it holds a tremendousamount of promise when we get it
solved though.
Speaker 1 (19:21):
Absolutely.
And I guess that's one of thethings that I see is, is that,
you know, with the era of smartimplements, which we see we're
very much in the middle of now.
And so between those smartimplements connected to a
tractor, oftentimes using theISO bus standard, um, and
creating that data, it's, it'sdoing some unique things, right?
And, and so it might not be ahundred percent dependent on
(19:42):
connectivity because we're outwhat they call on the edge where
the tractor implementcombination is working, but
certainly you can see wherethat's going grant.
Do you wanna talk a little bitabout that, how you see pieces
of that coming together?
Speaker 3 (19:54):
Well, sure.
Mike, I think we're starting to,starting to realize, as you
mentioned, you know, implementsgetting smarter.
I mean, a lot of people, I thinkview ACO as a tractor company
traditionally, and, you know,sometimes we say inside, you
know, nobody goes tractoring.
So it's really important to havethat implement, uh, being smart
and, and really being able to,to play a more active role in
driving the operation, whetherthat be through things like, uh,
(20:17):
tractor implement management,um, or being, you know, much
more smart in the agronomicsense of collecting data.
Um, maybe through a single passin the field, rather than having
to go grid sampling, or spendadditional time, labor and
resources that are already inshort supply to gather some of
that data and make betterdecisions and, and circle back
(20:37):
around to that doing more withless being able to utilize, you
know, better decision makingtools generated with, uh, you
know, new information with everypass in the field.
So, yeah, certainly I think, uh,smart implements is, is gonna be
a big thing as we look forwardin the future and, and, uh,
certainly an opportunity forgrowers to, to increase their
return investment and for, uh,equipment manufacturers to
(20:59):
provide those solutions
Speaker 1 (21:00):
Coming back to one of the things that Kurt brought up
right, is Kurt.
You were beginning to touch alittle bit on how business
models are changing and, andreally how we're beginning to
see this, some of those things,right?
Whether that's farmers adjustingto, you know, increases in
emission or emission inregulations, things like that,
elements of the connectivitygap, or, or even just how
(21:22):
farming is goes about as abusiness.
And so can you tell us a littlebit about some of the things
that came up out of thatconversations as part of this
project?
Speaker 2 (21:32):
Well, that's fair.
I'm, I'm a farm kid fromMissouri and farming, you know,
as we've kind of alluded tobefore the general premise of
farming, the business model offarming has not changed much
really in the last, you know,century.
Uh, really since the foodrevolutions, the market is ripe
for disruption right now, newbusiness models, whether that's
how a farmer accesses theirequipment or how they access the
(21:55):
technology.
I think we're, I think we'regonna see some, some different
things show up.
In fact, you're starting to seewhether it's, uh, uh,
investments that are being madeby startup companies into things
that are, you know, somebodycould be considered novel here
in the United States.
Or if you look at other areassuch as India, where there is a,
a push for, uh, ways in whichtractor ownership is changing, I
(22:18):
think, you know, the, thefuture's wide open as to what
that, what those business modelsare going to look like.
I think those are driven reallyby a number of kind of
underlying factors.
And that's how we got to thisparticular point, uh, with the,
with the futures council.
One of those is, is if you lookat the dollars that are flowing
into food production right nowfrom the investment community is
(22:41):
astounding.
They're flowing into those, youknow, before the pandemic.
But as grand alluded to earlier,the pandemic kind of put a
bright, shiny spotlight on theag industry, which is all of a
sudden caused more money tofocus in on agriculture.
But you couple that with theenvironmental pressures that are
being placed on the ag industry,and then you also, uh, add to
(23:03):
that, just this idea that, uh,that investment dollars are
always looking for industrieswhere efficiencies can be gained
largely because of the newtechnology.
I think we're seeing that that'swhy this whole new business
model really rises to the, tothe, to the front of a, of a
very interesting trend.
I don't know what it's gonnalook like.
You can't point to one inparticular, it's going to, uh,
(23:25):
to, to, to make the, make themost of it.
If that's, you know, carbonmarkets for a farmer to
participate in, or a, adifferent way in which a, uh, a
farmer accesses the, the, thetractor, or even the technology
that may, may be off balancesheet, who knows that we do know
that there's gonna be a lot,there's a lot of attention being
paid to this right now, and it'sgonna be different in the next
(23:45):
10 and 20 years and beyond.
Speaker 1 (23:48):
Absolutely.
And that was probably one of thebiggest things that we saw, uh,
in the discussions, or at leastthat I saw as a member of the
panel and in the discussions wasjust really looking at how much,
how land ownership models inboth the developed and the
developing world, how capitalasset models in the developing
world, how the service economyelements of things like sea and
(24:08):
spray and elements of yourconsultant, your consultant,
working with coordinated, smartequipment, working with the
delivery of on time servicesand, and really the logistics
challenges and opportunitiesthat those present, and then how
that begins to fit, whetherthat's for professional
ownership or even some of themore public domain pieces and,
(24:31):
and just a number of thingsthere.
Uh, how do you see it from theAGCO perspective?
Are you, you seeing some ofthese trends grant?
Speaker 3 (24:37):
Yeah, I certainly think so, Mike, I mean, you
touched on a lot of interestingpoints there, but I think, you
know, the flexibility I thinkis, is gonna be the big thing,
you know, I think flexibilityand, and risk management too.
I think as you look at, uh, farmoperations, you know, it's
certainly a, a high risk highreward business these days.
I think as we see operationsgetting bigger, we see
(24:57):
competition for land, you know,increasing in certain areas,
especially with pressure.
Um, like Kurt mentioned, youknow, with different investors,
you know, ownership models, uh,a lot of absentee landowners.
So really there's a lot ofpressure there to, to gain a
return on investment.
So things like guaranteeduptime, you know, uh, maybe
power by the hour, new ownershipmodels to support these things.
(25:20):
And again, you know, going backto the labor issue that, uh,
we're seeing on a lot of farms,you know, looking at how we can
be smarter with how we work, youknow, whether that's, uh, you
know, gaining access to, to moremachinery during peak times.
Um, or if that machine comeswith an operator, maybe through
a contract service, things likethat.
And I think there's a lot of,lot of different, uh,
opportunities as we lookforward.
(25:41):
And I think, um, again, you'llsee those under underlying needs
, uh, you know, met with the,the flexibility and, and
hopefully some risk mitigationoff offered for our growers as
well.
Speaker 1 (25:51):
Absolutely.
And so grant, why don't you talka little bit about, I mean, this
is obviously a passionateopportunity for you.
You've been involved in thiseffort of making this white
paper for the last couple ofyears.
If there was one thing that youreally, uh, and unique insight
that you got out of those 13different trends, what, what
jumped out at you?
Speaker 3 (26:09):
Well, you know, it, the whole, thing's been
interesting to me, you know,Mike, and I think, like we said,
there's a lot of underlyingthemes, but I think the real
underlying theme for me is thatagriculture will continue to
adapt.
We've got a growing population.
I think I've heard statistics,you know, something along the
lines of, we need to raise asmuch food between now and 2050
as we have for all of humanhistory, just because of those
(26:32):
multiplication effects.
We've mentioned with proteinconsumption, uh, with the world
population, you know, this is abig deal, a big challenge.
So, you know, limited waterresources, limited land
resources, limited laborresources, um, especially
trained labor.
You know, we've got a, a bighill to climb and I'm sure that
agriculture is going to rise tothe challenge.
Our farmers are gonna rise tothe challenge.
(26:52):
Our equipment manufacturers aregonna rise to the challenge to
feed this growing population.
So certainly that's what I'mpassionate about to contributing
to.
And, and I think this, uh, uh,white paper does a great job of,
uh, providing some thoughtprovoking insights to, uh, to
set the stage, to meet thosechallenges.
Speaker 2 (27:09):
Well, I'd say I've, I've two things.
First is, uh, the one that wasthe frankly the biggest eye
opener for me was how consistenteverybody was on these divergent
opinions, all coming together toagree on, uh, a few, uh, points
that were very important.
The one that rose to the top,the quickest was the biggest
(27:30):
surprise to me was waterscarcity.
Uh, and how much of an impactthat was going to have.
And this was two years ago kindof before it started even making
headlines in a big way with, uh,with the allocations we're
seeing, even in California, youknow, in the last, you know,
two, three weeks.
Uh, so that was a, that was oneof the biggest surprises to me,
but I would tell you theoverarching thing that makes me
very proud is I'm a farm kidfrom Missouri, and I get very
(27:53):
passionate about this type ofstuff.
And, uh, it's very easy for meto look at this paper and say,
this is difficult for those ofus that are incumbents in the
industry.
Uh, equipment manufacturers say,this is gonna change our world.
And you know, it's not gonna bebusiness as usual, man.
I look at the complete oppositeway and I love the conversations
around sustainability and usingtechnology to feed the
(28:15):
population in a very sustainableway, because we've got this.
And if you think about howexciting it is to see how much
change is happening, just righton the cusp of, uh, you know, 5,
10, 20 years from now, thisindustry's gonna look very
different.
And it's very exciting for thoseof us that are, you know, have
been involved in agriculture,all of our lives.
(28:37):
And we've been waiting for thismoment to finally have a reason
to, to prove that we've got the,uh, we're up for the challenge.
And I think all of ourmanufacturers are excited to
kind of get behind some of thesetrends, some of these ideas to
say that this is not a challenge, uh, that we're gonna take
lightly, but it's one that we'regonna approach with enthusiasm,
and we're gonna approach it with, uh, with the right amount of,
(28:58):
uh, of, of thought because thetechnology does allow us to do
some pretty amazing things.
Speaker 4 (29:03):
We've been talking about AEM, the future of food
production, white paper.
And if you'd like to get yourown copy to learn more about the
13 different trends, you canvisit Topcon
positioning.com/future of food.
That's Topcon,positioning.com/future of food
Speaker 1 (29:25):
Edge.
Certainly like to thank both ofour guests, both grant good from
AGCO, as well as Kurt bladesfrom the association of
equipment manufacturers and AEM.
If you've enjoyed this podcast,please remember to like share
and subscribe to Topcon tops,agriculture on Spotify, apple
podcast, Amazon music, orwherever you get your podcast.
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