The current adoption of Unmanned Aerial Vehicles in Agriculture (Ag Drones) in selected Asian countries remains very low, per the latest industry report from Ipsos Business Consulting, a global growth strategy advisory firm.
The paper – Commercial Drone Adoption in Agribusiness: Disruption and Opportunity – notes that aerial agricultural tools in China affects less than 2% of farm area, highlighting the huge potential for a technology that has long been heralded as being the answer to the question of how to make mechanization accessible to smallholder farmers across Asia and other regions. The corresponding figures for Thailand and Philippines is less than 10 per cent of farm area, whilst aerial tools in South Korea cover less than 15 per cent of farm area.
"Although earliest applications of agriculture drones can be traced to the late 1970s Japan, commercial applications of drones in agriculture has only recently started to gain momentum" said Markus Scherer, who leads Ipsos Business Consulting's centre of excellence for commercial drone technology. "For many value chain players, application of this technology has provided farmer operators an affordable alternative technological tool to implement precision agriculture practices as well as address resource efficiency when managing crops."
The report provides evidence o that there are considerable opportunities in Asia for the manufacturers of UAVs as well as the challenge for the agribusiness companies to find ways of effectively utilising this technology so that it is both affordable and practical for the small farmer as well as the large commercial farms." Mr. Scherer highlights that both Thailand and the Philippines had less than 10 per cent of farm area subject to aerial tools, whilst South Korea has less than 15 per cent, reinforcing the point that the challenges and opportunities really are Asia Pacific issues and not just China centric.
Typically marketed and perceived as a precision agriculture tool however, an often overlooked value proposition of this technology lies in the application agriculture drones can offer for more traditional farming practices. The business implications of agriculture drones in this context is also attractive, some studies estimate that agriculture drones can reduce water usage by 90% for irrigation, and reduce up to 30-50% in chemical use.
Natee Ruengjirachuporn, Global Agribusiness Sector Lead for Ipsos Business Consulting noted that there were similarities with earlier farm mechanisation initiatives, but agreed with Mr. Scherer that the UAV technology has greater potential to provide an affordable farm mechanisation option that can be more easily embraced by farmers in both plantation and individual farmer segments. "Governments and industry have long wrestled with the challenge of fast tracking the rate of mechanisation within agriculture to improve yields and quality. Whilst there has been pockets of success across the Asia Pacific region, the rate of farm mechanisation has not been as fast as everyone would like to see, often due to the typical farm size making many mechanisation options unaffordable. Aerial tools have huge potential to jump past this hurdle. We can also see many AgTech players have been actively trying to introduce their products and services in this region, nevertheless different farming practices and farmer's behaviours amongst countries could be one of the key considerations for players to have a successful market penetration in this region."
Uncovering alternative opportunities from agriculture drone technology, it becomes pertinent to examine current farming practices, potential paths to adoption, and market attractiveness to assess the extent of impact by agriculture drones.
Commercial Drone Adoption in Agribusiness – Disruption and Opportunity has a firm message for those industry players hoping to be a catalyst for the growth in farm: there have been many innovative products and technologies launched in the Asian agricultural industry since the turn of the century, with few having the expected impact. Those companies hoping to take advantage of an expected boom in drone technology must first do their homework. A clear understanding of the factors and implications at play in agriculture drone adoption is essential for determining the roadmap for adoption of this technology. In each market context, the Ipsos Business Consulting paper also illustrates the variance in regulatory environment, productivity challenges, and economic incentives influencing the speed of agriculture drone adoption in each country.