The Business Research Company defines the agriculture (agri) market as consisting of sales of agriculture and related services by entities (organizations, sole traders and partnerships) that provide agriculture and related services such as animal and crop produce and other support services.
It estimates the global agri market at US$10,181.92 billion in 2021, up 6% from 2020 and forecast to reach US$12 trillion by 2022.
The Asia-Pacific region accounting for 57% of the global market.
In a separate report, Lux Research noted that political, economic, social, and technological factors are all elevating the need for end-to-end food traceability and transparency, and the COVID-19 pandemic served as a force multiplier
While there is an abundance of reasons for agri-food companies to implement traceability and transparency tools, understanding the value of doing so is nontrivial.
Lux’s new report, “Demystifying Food Traceability and Transparency,” seeks to provide much-needed clarity to the murky subject of the value of implementing traceability and transparency tools for agrifood companies. To develop a better sense of what is driving food traceability, Lux evaluated different macro forces that are promoting adoption: political, economic, social, and technological (PEST). Then Lux clearly categorized the qualitative and quantitative outcomes of food traceability projects and created a hot spot map of these outcomes among the 41 traceability projects analyzed. Further, Lux identified the unmet needs in the incumbent traceability activities and emerging technology solutions and their developers and laid out the future directions of this space.
Jerrold Wang, analyst on the Lux Research emerging ecosystems of agrifood and health team and the lead author of the report, noted that among the food traceability drivers from political, economic, social, and technological angles, regulation bears the most weight.
He conceded that opportunities exist beyond simple compliance and provide real business benefits.
“Measuring a tangible, quantitative ROI remains difficult; however, the downside of failing to embrace food traceability, especially given tightening regulations, currently outweighs the unclear upside,” he concluded.
3 major unmet needs of agri stakeholders
Sustainability measurements – Measuring indicators of sustainability is now critical to corporate reporting. With increased supply chain connectivity, accurate and granular data is requisite.
This is an urgent and complex challenge. Sustainability indicators are difficult to measure and suffer from a lack of standardization.
Supply and demand forecasting – The COVID-19 pandemic demonstrated food system fragility to disruptive shock. Ideally, layering predictive analytics around traceability data improves forecasts of supply and demand and balances the gap between them.
Building resiliency requires improved inventory management to resist likely future perturbation.
Trade facilitation – COVID-19 forced countries to reexamine local food security, but cross-border trade remained an economic lifeline for many regions. There is a need to optimize food supply chains when sudden, unpredictable perturbations occur.
Global trade will require innovations that rapidly resolve disputes amid a growing frequency of supply chain disruptions.
Technology developers will work in earnest to capitalize on the unmet needs expressed by agrifood stakeholders, but a “one-platform-fits-all” approach is not viable, despite being the state of the art.
With companies inevitably forced to utilize different platforms, platform interoperability is critical to achieving the long-desired “network effect” in food traceability.
Agrifood companies should be active participants in forming consortia with suppliers, customers, tech developers, and standardization organizations to test and validate platform interoperability and metrics.