The digital transformation of the agriculture and food system

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agriculture policy brief

The digital transformation of the agriculture and food system

February 2019

Digital technologies provide new opportunities for the agriculture sector and the global food system, including smallholders, offering new solutions to meet old and new challenges. Policy makers can also benefit from digital technologies, which can support the design and implementation of agriculture policies, supporting better targeting and efficiency. olicy makers must consider both the characteristics and needs of the agriculture sector in P broader digital strategies.

What’s the issue? New opportunities to create and share information are shaping the digital transformation of the agriculture and food system. These new opportunities are particularly important in the context of the challenges of climate change and in an increasingly integrated global food system. The OECD is exploring opportunities and challenges offered by digital technologies for both the government and the agro-food value chain, to understand what roles governments can have in facilitating this transformation. Whether and how digital technologies provide opportunities to address traditional constraints in the sector, but also whether they can create new challenges that governments should take into account. Digitalisation of agriculture and farms is occurring across a broad spectrum, from low-tech solutions using mobile devices and platforms to provide management decisions services, to high-tech “digital farms”. But more than the “digital farm”, the digital transformation of agriculture is about data and the use of data. The agriculture sector is now becoming both an important consumer and supplier of data, potentially across borders, enabling value creation both upstream and downstream of the farm. Upstream of the farm, this includes providing new services using on-farm data to customise services to farmers, research and development, or finance. Downstream, farm data can feed into to the rest of the value chain: food processors, wholesalers, retailers, or

government, for traceability and more broadly for public and private standards in line with evolving consumer preferences. Helping to overcome information gaps and asymmetries, digital technologies allow stakeholders with different preferences and incentives to work better together, creating an opportunity to improve policies for the agro-food sector as well as new market opportunities, including for small stakeholders. The ability to use digital technologies in agriculture depends not only on access to basic connectivity infrastructure (broadband, telecommunication services, etc.), but also on the development of data collection and analysis services, and on the regulatory environment. Together, this data infrastructure enables a series of feedback loops that can inform stakeholders at all levels of the agro-food value chain, including governments, to gain knowledge for decision making, increase the efficiency of existing production, and better manage value chains and policy processes. However, government should be aware that the policy and regulatory environments, or the lack thereof, at each stage of the data infrastructure influences the extent to which digital tools are available to stakeholders (see figure), as well as value added distribution outcomes. In addition, digital technologies are not a silver bullet, and old issues might still prevail, or some new problems might arise.


The digital transformation of the agriculture and food system Digital opportunities in agriculture: some policy implication • Regulations affecting the supply of service to provide actionable insights • Policy monitoring and implementation

• Agriculture business services (platforms, digital extension services, technical advices) • IoT specific: augmented behaviour (machine to machine)

Analytics and modelling: augmeted intelligence

• Policies affecting technology adoption and service provision • Regulations affecting the harvesting of data specific to the production system and its ecosystem Sensors: Remote and in-situ • on-farm • other (drones, network of sensors in monitored ecosystems)

Farm Production system

Digitalisation of the farm system & collection of data

Underpinning connectivity

Big Data governance: • Data ownership and open data • Pre-competitive space • Liability

• Data analytics

• Connectivity infrastructure in rural areas (broadband, WiFi, mobile)


Association with data from other sources (Big Data)

Storage and data management Standards: • Interoperability • Data ownership • Privacy • Security

What should policy makers do?

Legend Digital technologies and services Institutional arrangements

• Data management & storage technologies

Data and information flows

supporting dialogue between stakeholders to address the issues of control, use and sharing of data in agriculture. Attention should also be given to ensure access to services and data flows in a global digital infrastructure and to recognise the specificities of agriculture data – including the potentially conflicting view that data is either a private asset or a public good.

supporting connectivity and the development of a data infrastructure, including their cross-border dimension, particularly by supporting co-ordination among stakeholders to foster change, both between the public and private sector and between countries.

Digital technologies provide an opportunity to re-think the way policies and regulations are made, but they might also change the role of the government in the agriculture sector more broadly. In looking to take greater advantage of digital technologies in policy making, governments should first re-evaluate systems before simply replacing analogue activities with a digital format. In addition, in using digital technologies for new policy design and implementation, they should be careful to avoid creating new digital divides.

Standards: • Data ownership • Data flows • Privacy • Security

In addition, governments could further support the digital transition of the sector by: •

making use of digital technologies to improve the efficiency and effectiveness of existing policies and enabling new types of measures – for example policies that are more results-based, more collaborative, or less compliance-driven. addressing challenges to their own adoption of digital technologies, including institutional constraints, and transparency, oversight and responsibility.

developing standards for quality data and for algorithms.

championing efforts to improve access to agricultural data (both for research and the provision of services to farmers).

Further reading • M. Jouanjean (2019), “Digital opportunities for trade in agriculture and food”, OECD Food, Agriculture and Fisheries Papers, No. 122, OECD Publishing, Paris, https://doi. org/10.1787/18156797. • DeBoe, G., and M. Jouanjean (2019, forthcoming), “Digital opportunities for trade in agriculture and food”, OECD Food, Agriculture and Fisheries Papers, OECD Publishing, Paris. • OECD (2018), “Digital technologies in food and agriculture: Reaping the benefits”, Summary Record: Global Forum on Agriculture, 14-15 May 2018.


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