Harnessing data for sustainable profitability in agriculture

Does data hold the key to unlocking profitability in sustainable agriculture? How can we work together to harness its potential? Speakers at Alltech ONE Budapest answered these questions and more this week as they explored the ways in which data can unlock new levels of growth in agri-food.

Three Alltech executives — Robert Walker, European growth officer; Tara McCarthy, global vice president for ESG; and Dr. Mark Lyons, president and CEO — examined the transformative role of data science in agriculture, as well as the future of sustainability in agri-food and the science of sustainability.

Data science in agriculture paves the way for growth

Customized data can provide food producers with a deeper understanding of their business, allowing them to optimize operations, identify inefficiencies, minimize waste and maximize their resources. Data-driven insights can help producers find sustainability strategies that also enhance profitability.  

Food producers can leverage regulations such as the European Green Deal to design digital strategies that not only avoid green penalties from government, but also focus on creating branded, unique products, Walker said.

European feed production is declining, according to the 2023 Alltech Agri-Food Outlook, and yet, the value of European food production is on the rise. This calls for integration among the supply chain.

“Businesses that are most resilient and future-ready are those that are integrated, with clear linkages between agriculture and food production,” he said. “Integrated businesses are better able to deliver on consumer expectations for food that is nutritious, tasty, produced sustainably, and ensures the welfare of animals.”

While sustainability, consumer trends, pandemic and geopolitics are the main drivers of agri-food integration, ag-tech is the enabler of value capturing. Sustainability claims on food packaging, for example, can greatly boost the value of food products. These claims rely on verifiable production information.

Data also enables advisory services to give effective guidance, and it validates the impact of management changes, Walker said.

Digital platforms can connect members of the supply chain and allow businesses to be virtually integrated, Walker said. It also allows the transfer of value across the supply chain, from retailer to processor to farmer.

For example, Alltech’s three-step process — measure, advise, partner — demonstrates the power of data-driven decision-making. By gathering farm-specific data, food producers can better understand their systems, set goals and identify opportunities for improvement. Advisors equipped with this data, such as veterinarians and independent consultants, can provide valuable insights and guidance to farmers, feedmillers, food processors and other stakeholders in the value chain.

Walker referred to the advisory services of Alltech E-CO₂, whose certified environmental assessments provide a wealth of in-depth data on animal production, health, feed, fertilizer, nitrogen balance, water, energy and resource use. The data collected is used to deliver practical on-farm and online programs, as well as benchmark reporting, with clear and concise consultancy advice to lower the producer’s carbon emissions.

Alltech also uses its InTouch system to bring together farm insights and results from on-farm measurement tools. Its advisors help farmers interpret data and set goals.

“By sharing data and insights, we empower advisors to solve agri-food-system challenges and drive the transfer of value, from the consumer to the processor to the farmer,” Walker said.

What’s next for sustainability in agriculture?

The sustainability agenda has quickly accelerated over the past five years, McCarthy said.

Before 2015, the topic of sustainability was more popular among the academic world than the public. Terms like “ESG reporting” were not as integrated into businesses as they are today. The tipping point occurred between 2015 and 2020, driven by initiatives such as the United Nations Sustainable Development Goals and the Paris Agreement, as well as popular influences, such as David Attenborough’s climate change documentaries.

Now, sustainability is being integrated throughout the agri-food industry. A key driver of progress today is policy changes, such as the European Green Deal, McCarthy said. The Green Deal aims to transform the European Union’s economy into a sustainable and climate-neutral one by 2050, and legislative framework has been introduced to ensure that all sectors meet its goals. The United States has committed to a 40% reduction in carbon emissions 2030. It has announced a net-zero target for 2050.

What’s next?

Increased regulation, climate-change activism, media attention and consumer demand are driving sustainability discussions. Consumers expect food producers to step up, McCarthy said. While everyone across the value chain has a role to play, food producers are front and center, followed by governments and policymakers, farmers and shoppers themselves.

How can the agriculture industry create a more sustainable food system? It starts with data.

McCarthy encouraged the audience to take the Alltech Sustainability Insights Survey to share their perspective on the issues that matter most to the value chain.

“Even if we’re 10% more informed as an industry, we’ll make better decisions,” she said.

As part of Alltech’s insights survey project, the company has spoken with 26 industry leaders to better understand the complexity of the food industry and identify issues that affect the value chain.

The initial key insights from these conversations are related to:

• External forces: Food is a complex industry influenced by policy, politics and nutrition.
• Understanding sustainability: There is much more to sustainability than reducing emissions.
• Cost: Consumers want food that is sustainably produced, but very few are willing to pay the price for it.
• Proof: How do we make sure sustainability models have the flexibility to adapt and the reliability to be repeated?
• The role of technology: Can technological solutions be financially viable at the scale we need it to operate?

“We have the opportunity to shape the future,” McCarthy said. “Ultimately, what all of us are looking for is better food with fewer resources from our planet.”

McCarthy encouraged conference attendees to embrace the power of data to help the agri-food industry fulfill its essential role of both nourishing and replenishing the planet.

“Data is our friend,” she said. “It’s almost like an insurance policy to show what we have done to consistently prove the improvement we are making.”

As we look for answers to today’s challenges, science gives us a sense of optimism, Dr. Lyons told attendees. Innovation and collaboration are vital.  

“We are coming out of a time of chaos,” Dr. Lyons said. “A lot of old rules are being thrown out. This is the time to adapt and think in new ways.”

The Alltech Sustainability Insights report will offer an in-depth look at how our industry is responding to today’s challenges and help us develop a collaboration strategy for delivering a Planet of Plenty™. Take our survey today!