Smart farmers

Background

Brazilian agtech boom produces 1.125 start-ups

Brazil already has 1,125 agtech companies, according to the study “Radar Agtechs Brasil 2019”.

Initiated by Embrapa (Brazilian Agricultural Research Corporation), SP Ventures and Homo Ludens, the detailed research points out the number of agtech start-ups in Brazil has more than tripled in just 1 year.

Major technical leaps forward

In the opinion of Cleber Soares, director of Innovation and Technology of Embrapa, agtech’s task is to “allow Brazilian agriculture to achieve further major technical leaps forward to be increasingly productive, efficient, sustainable and resilient in order to face the world´s scale challenge of providing farm products”.

“There are numerous opportunities for a rising entrepreneurial class in Brazil, which has a great capacity to mobilise talent. There is no better place to experience agtech’s vibe than the Brazilian agricultural environment”, says Soares.

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  • The Radar Agtechs 2019 presentation in Campinas - Photo: Magda Cruciol (Embrapa)

    The Radar Agtechs 2019 presentation in Campinas - Photo: Magda Cruciol (Embrapa)

  • Radar Agtechs 2019 was organised by Embrapa, SP Ventures and Homo Ludens. - Photo: Magda Cruciol (Embrapa)

    Radar Agtechs 2019 was organised by Embrapa, SP Ventures and Homo Ludens. - Photo: Magda Cruciol (Embrapa)

Innovation key factor

Fernando Camargo, the Innovation and Irrigation secretary of Brazilian Ministry of Agriculture, Livestock and Supply (Mapa), says innovation is seen as a key factor in order for Brazil to live up to its vocational role of providing food, fibre and fuel worldwide.
“This ebullition has happened regardless from governmental support; however, Mapa understands ag innovation meets up with Brazilian destiny. First of all, we can´t disturb this process and should help on many aspects such as spreading connectivity, gathering efforts, promoting partnerships and supporting a democratisation process”, says Camargo.

Factors that contribute to the agtech boom

Several factors have contributed to this agtech boom. Firstly, the FAO (Food and Agriculture Organisation of the United Nations forecasts that the world demand for food between 2010 and 2050 will increase by 70% and this trend is already reflecting on international trade.

Secondly, Brazil is a “natural” provider of agricultural goods because of its large resources and its climate, and, moreover, its farming know-how . As a consequence, despite the instable domestic economy, Brazil´s agribusiness sector is keeping a “Chinese pace” of growing since the 1970´s.

Finally, Brazilian agribusiness is attracting special attention from entrepreneurs, researchers, investors and agtech companies aiming to make a digital transformation towards the future.

The “Radar” study helps to understand at what level agtech currently is in the country and which solutions it has provided. According to Francisco Jardim, director of SP Ventures, the main goal “is to join efforts for the sector’s development and support businesses with high potential solutions”.

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Luiz Sakuda (Homo Ludens) says Brazil is one of the main agtech markets. - Photo: Magda Cruciol (Embrapa)
Luiz Sakuda (Homo Ludens) says Brazil is one of the main agtech markets. - Photo: Magda Cruciol (Embrapa)

Investments

For example, agtech start-ups received US$ 80 million in investments in 2018, against US$ 20 million in 2017. “The venture capital industry’s duty is not just to foster business, but to boost great leaps of humanity. The current context allows, for the first time, one of these transformations to have Brazil and its agriculture as epicentres”, says Cleber Soares.

According to Luiz Sakuda, founder of Homo Ludens Research and Consulting, the study shows Brazil as one of the main agtech markets in the world. In accordance with the AgFunder 2019 report, the others are the United States, China and India.

“Given the great representativeness and potential of the Brazilian agricultural sector, the market for technological solutions for agribusiness is very promising, throughout all stages of the chain”, says Sakuda.

Classification of Brazilian agtech companies

Among the 1,125 Brazilian agtech companies, 196 or 18% are classified as “before the farms” (inputs), 397 or 35% as “inside the farms” and 532 or 47% as “after the farm”. Agriculture accounts for 54,3%, food for 33,6% and animal production for 16,8%.
Geographically, 90% of these start-ups are located in the Southeast (São Paulo, Rio de Janeiro, Minas Gerais and Espírito Santo) and the Southern (Rio Grande do Sul, Santa Catarina e Paraná) regions of Brazil. The most relevant cities are São Paulo (262), Piracicaba (41) and Campinas (38). Just 18 cities house 58% of the total number of companies.
“Before the farms” agtechs work on laboratory analysis (20), biological control (32), shared economy (10), fertilisers and nutrition (41), genomic and biotechnology (40), animal health and nutrition (20), seeds and saplings (9) and financial services (24).
“Inside the farms” is divided in precision agriculture (340), fish farming (7), content and education (18), imagery diagnosis (8), waste management (21), IoT (20), machinery (34), irrigation and meteorology (21), monitoring (19), remote sensing (29), management systems (122), automation and telemetry (21) and drones (43).
The “after the farms” group delivers solutions in food (246), warehousing and logistics (29), bioenergy and biodiversity (14), consultancy (26), plant factories (13), 4.0 Industry (8), retail management (24), online shopping (29), marketplace (95), online restaurants (24), traceability (12) and packing (12).

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