Even if you are not familiar with the term "agritech", you may have unwittingly seen examples of it in restaurants, farms, and more. For example, if you've dined at farm-to-table restaurants like The Farm Foodcraft in Bangsar South, you've actually already come across Agritech in the form of hydroponics.
The integration into a dining concept is unique, but Agritech offers more than just hydroponics. Here's what you can find in Malaysia's agritech scene today if you dig a little (excuse the pun).
What is Agritech?
Simply put, it's the abbreviation for agricultural technology, which is a collection of scientific techniques used to improve plants, animals and microorganisms that, according to the Australian Biotechnology Organization, are beneficial for farmers, the environment and consumers.
These techniques are used in plant and animal biotechnology and biofertilizers to protect plants from pests and disease, reduce pesticide needs, reduce food production costs, and provide alternative fuel sources.
Here are some agritech use cases:
- Smart farming (automated irrigation, vertical farming, hydroponics, etc.);
- Drones and satellites (scanning and monitoring crops and fields);
- IoT-based sensors (Internet of Things) (provide precise information about weather, quality and current state of the soil);
- Blockchain and Big Data (so that consumers can find out where their products come from);
- Biotech (creation of plants that are better able to adapt to the environment than normal ones, development of artificial fertilizers, etc.);
- Farm maintenance technology (optimization of water consumption, correct selection of mature products, etc.);
- Production and innovation technology (removing the middlemen and bringing agriculture closer to urban areas).
Agritech refers not only to agriculture, but also to horticulture (gardening basically) and aquaculture (raising aquatic animals or growing aquatic plants for food).
An example of agritech's role in simplifying farming is the use of a soil sensor to detect moisture levels and moisture flow, which can be used to send data back to a farmer on demand, hourly, or daily. This saves a farmer time not having to go to the field to check the soil regularly every now and then.
When it comes to technologies like IoT and AI, agriculture becomes more efficient and less labor intensive, which helps the farmer get more yield compared to traditional farming. This also puts less strain on the farmer in order to meet the requirements of our growing world population.
How important is that Agricultural sector in Malaysia?
Agriculture remains one of the most important sectors in the country, and since the last report in 2019, the agricultural sector is the third highest GDP contribution (7.1%, equivalent to RM101.5 billion) in the country, ranking next to the Mining and quarrying sectors.
Exports rose from RM 114.5 billion in 2018 to RM 115.5 billion in 2019 (0.9% increase), and imports rose from RM 93.3 billion in 2018 to RM 93.5 billion. RM in 2019 (0.2% increase). The trade balance of this sector increased by 4.1% from 21.1 billion RM in 2018 to 22.0 billion RM in 2019.
Dictionary time: The trade balance is the net total of a country's exports and imports of goods without taking into account all financial transfers, investments and other financial components. A country's trade balance is positive (meaning it registers a surplus) when the value of exports exceeds the value of imports.
Since agriculture is one of our most important industries, it is all the more important that opportunities to improve processes are constantly developed and implemented. However, one major problem still stands in our way.
Whoever needs Agritech most urgently in Malaysia cannot afford it
The group of farmers most in need of agritech are smallholders who make up the majority of farmers who dominate the local agricultural sector.
They are the ones who tend to face low productivity and low crop yields due to the lack of labor on their holdings. In addition, there are also problems with the inability to cope with natural disasters and waste due to poor agricultural practices.
In terms of labor that we just touched on, employment in the agricultural sector has decreased slightly from 1,570,300 in 2018 to 1,541,100 in 2019. It is therefore important that agritech step into the picture to cushion the decline before it hits an all-time low for farmers.
Agritech, like smart sensors and drones, aren't cheap, however. For example, drones that provide images of field conditions can cost around $ 1,000 (about RM 4,145) each, not counting the salary of talent hired to operate one. Currently, this is an unrealistic price for many smallholder farmers when they are expected to pull the money out of their own pockets.
“We'd love to get our hands on automated hardware like a robotic harvester that cuts our labor costs or a weather station device that uses historical data to tell us the best time to plant, fertilize and water. But all of this is just too expensive now, ”a local farmer, Markus Chin from Shinnou Farms, told Al Jazeera in 2019.
Agritech sector growth in Malaysia
Over the years, several initiatives have been taken by the public and private sectors in Malaysia to help grow Agritech by funding startups with Agritech solutions, providing microfinance programs for farmers to introduce Agritech, and more.
In 2018, the Malaysian Digital Economy Corporation (MDEC) initiated a pilot project through a public-private partnership with Pertubuhan Peladang Kawasan Kuala Langat (PPKKL) to increase the yield and quality of plants using the latest technologies.
Farmers have implemented an Internet of Things (IoT) enabled fertilization system (combination of fertilization and irrigation) that has enabled them to reduce monthly fertilizer consumption by 20%, reduce monthly manpower requirements by 25% and improve the overall quality of the yield (degrees) A chilli) by up to 90%.
In 2019, the Malaysian Global Innovation & Creativity Center (MaGIC) held a bootcamp for Agritech startups with a demo day at the end of the 10-day event during the Global AgriTech Summit.
3 Agritech startups that emerged as winners of the boot camp were:
- Sayur.Farm: Developed a FitBit-like device that can serve as a farm assistant that can update the current state of crops and their surroundings, collect information through artificial intelligence and visualize data to provide yield forecasts, plant health, recommended recipes and share, insights , Profit analysis and earnings analysis;
- Origins of life: production of fly larvae of black soldiers from organic waste and their conversion into cattle, animal and animal food;
- FarmExchange: A closed marketplace where farmers can get credit directly for the equipment they need. Farmers can also get a credit score, and lenders can have a transparent view of the farmer's requirements, proposed ROI, and schedule.
However, it appears that all but Life Origin have not been active lately. Some more local agritech startups currently active are:
- Braintree Technologies Sdn Bhd: Uses drones to count and spray trees, map plantations, map infestations, etc .;
- TanaLink EARS: Uses technology to provide real-time data and your farm for theft, harvest, fertilization coverage, wildlife presence, soil sensors, etc .;
- plantOS: uses a fertilization system that can detect diseases in advance, act as a soil sensor and automatically fertilize your plants accordingly, reducing nutrient waste.
- Fefifo: Offers smallholders and young unemployed agricultural graduates arable land and technologies to start a modern agricultural company with guaranteed purchase.
- Nutribah: Uses an IoT-based smart farming system and has its own fleet of drivers to eliminate the middlemen and deliver their products directly to consumers.
While there aren't too many established local agritech startups in the country yet, MaGIC CEO Dzuleira Abu Bakar noted that agriculture is changing with the pace of change. While this has been underfunded in the past and not as popular in an industry, it quickly turns around. With these technological advances in agriculture, too, the industry is beginning to become more inclusive and attractive to the younger generation.
Even Petronas crept into the Agritech ecosystem last year as VC for Braintree Technologies under Petronas Ventures and in line with Petronas' Sustainability Agenda and United Nations Sustainable Development Goals, further signaling the potential of Agritech in Malaysia .
Just last week, MDEC and CIMB Islamic signed an MoU to extend a comprehensive microfinance program with an allocation of 10 million RM as the first financing package to catalyze digital agricultural technology (Digital Agtech) in Malaysia. Over the course of the program this allocation can be increased to RM 25 million.
MDEC's ongoing eLadang program also benefited 548 participants in December 2019. 78 farmers took advantage of digital farming technology, which resulted in a 20% increase in productivity and a 30% increase in income
a 30% reduction in operating costs.
As the MoU contributes to the increased use of technology in agriculture, job opportunities created in this sector are expected to increase by 30% by 2025. At the same time, more young people who are needed for the administration and operation of the innovative technologies are being driven to participate.
- More articles on Agritech can be found here.
Selected image source: Poladron via Tech for Impact