The Upcoming Tectonic Shifts in Food and Agri Supply Chains

Posted on October 11th, 2023

What if you could predict the onset of a disease in your pomegranate orchard days in advance and take preventive action? If you could just stick a probe into your soil and figure out exactly how healthy your soil is, or if machines could operate at ultra-high speeds and sort fresh produce not just based on their colour and size but also their sweetness and taste, wouldn’t that make it so much easier? What if your retailer could seamlessly integrate into a complex supply chain and alleviate his inventory woes?

So many of these scenarios are now becoming a reality. 

For a long time, the food and agri space has been the country cousin of the more glamorous segments in the startup world such as grocery e-commerce, last-mile food delivery, and quick commerce. The set of folks, technocrats, engineers, coders and others working in this space have been seen as idealists toiling away in the dust. It has been deemed as unlively to adopt technology – impossible to scale and, frankly, too boring. However, there is a significant tectonic shift occurring in this space.

The entire food and agricultural supply chain will make a fundamental transformation in the next 20 years, using and gaining from more technology than what was made available to it, and absorbed by it in the past 200 years i.e., the entire period of the industrial revolution. Further, the inflection point of invention and absorption has already been crossed, and we are firmly in the phase where early adopters are rapidly scaling and triggering escalating interest in the mainstream users. Lastly, the absorption of technology will be worldwide, and not just restricted to a few developed countries. In fact, emerging economies will leapfrog developed countries in this.

I saw evidence of this in Dubai where WayCool unveiled its complete technology stack for the first time. The quality of enquiries (over 180 serious queries) we received, the sense of urgency amongst all operators in the supply chain for solid, mobile-first, scalable, and completely integrated technology solutions, whether it is farm tech or distribution tech, was astonishing. These customers were not dabbling curiously in little experiments. No, these seasoned practitioners were very clear in their ask – complete, climate-agile solutions that ensured consistent yield, superior performance, reduced costs, and predictable returns on agricultural investments at the farm end, and cohesive solutions that exponentially deflated waste and inventory while dramatically improving service levels.

Another point is the rapidity with which Indian farmers and retailers are taking to technology. We recently launched the second version of our Outgrow super-app for farmers. We had 27,000 downloads in 10 days, 3,764 active users, and more than 2,118 users using our AI-based disease detection tool. Interestingly, more than 25% of the farmers connected with our agri-doctors through the in-app chat. A lot of myths are getting busted here.

For long, commerce has been valued over technology, and many companies have been forced to deploy their otherwise formidable capabilities towards solving simplistic issues such as commercial transactions. That’s changing quickly. As candy floss capitalism fuelled by artificial liquidity tapers down once again, technology is going to eat commerce for breakfast in the food and agri supply chain.

We continue to invest in our tech stack even as we respond to the push to build and scale a commerce platform. It gave us a head-start, despite the view from the outside world that we were doing something that was perhaps a bit too complex. We will continue betting on this, and build our stack which is already one of the most comprehensive on the planet.

A lot of folks have bypassed betting on this space in the past decade, while pumping their dollars into thinner, somewhat trivial models. There are others who went ahead with their due diligence of the sector and its participants, but were stopped by red lights when it came to actually making bets. Well, those red lights just turned out to be the taillights of the bus that you missed.

Focus on Food, Not Just Agriculture

Posted on October 11th, 2023

Food security is a priority for every country, considering the challenge of delivering sufficient food to the world’s population. The world population is estimated to touch 9 billion by 2050. ‘Zero Hunger’ and promoting sustainable agriculture ranks second in the United Nations’ 17 Sustainable Development Goals (SDGs) for 2030. However, currently around 690 million people worldwide (8.9%) go hungry, as per the UN. This is expected to cross 840 million by 2030, making ‘Zero Hunger’ a pipedream. A majority of the world’s undernourished – 381 million people – are still found in Asia, with Africa not far behind at 250 million.

For example, India, despite being the second-largest producer of fruits and vegetables in the world, has an astounding 17.76 lakh acutely malnourished children and 15.46 lakh moderately malnourished children. This is according to a recent report released by the Women and Child Development Ministry of India. In October, the 2022 Global Hunger Index ranked India at 107th out of 121 countries indicating that India has a serious hunger problem.

Worldwide, extreme poverty is predominantly rural, with smallholder farmers and their families accounting for a very significant percentage of the poor and hungry. Achieving Zero Hunger and eradicating poverty are integrally linked to augmenting food production and agricultural productivity.

In addition, increasing pressures on natural resources and climate change threaten the sustainability of the world’s food systems. Climate-related disasters, including forest fires, droughts, hurricanes, flash floods, and storms, are happening with alarming frequency. These disasters adversely impact agricultural productivity, which means food availability suffers. This causes food prices to skyrocket and results in income losses that prevent the poor from being able to afford food.

Reimagining our food systems

Our food systems need an overhaul backed by responsible investors with a concern to enhance the livelihoods of smallholder farmers, and reduce the carbon footprint of food supply chains. Policymakers should also involve stakeholders, and develop food systems anchored by smallholder farmers who can sustainably deliver safe, affordable and nutritious food throughout the year.

Food and Agriculture Organisation (FAO)’s twin-track approach to fight hunger uniquely combines rural development with sustainable agriculture to enable vulnerable sections to access food.

These include:

  • Enhancing the food supply to the most vulnerable
  • Improving rural food production, especially by small-scale farmers
  • Investing in rural infrastructure and rural markets
  • Revitalisation of the livestock sector
  • Resource rehabilitation and conservation
  • Enhancing income and other entitlements to food
  • Food aid
  • Seed/input relief
  • Capital for livestock restocking
  • Enabling market revival

We need to develop food systems anchored by smallholder farmers who can sustainably deliver safe, affordable, and nutritious food throughout the year to low-income people.

Food safety is a top priority. Every country must adopt technologies that support traceability and track the food journey from farm to fork. Consumers need to know where their food comes from, and how it supports the local economy. This includes adopting comprehensive food safety policies and robust strategies to eliminate food contamination. 

Upgradation of cold chain infrastructure can eliminate food waste. The FAO estimates that almost one-third of the produced food is lost or wasted globally. That’s about 1.3 billion tonnes of food per year – enough to feed 3 billion people!

Shifting our focus to food rather than only agriculture will reveal the bigger picture and the integrated linkages between farmers and the food ecosystem, so that the consumer has access to safe, affordable food.. 

However, local knowledge must be considered while chalking out a food security strategy as a one-size-fits-all approach will not work in aligning ourselves to the Zero Hunger goal. 

A holistic approach

Building sustainable and resilient food systems that produce nutritious crops and livestock products calls for a holistic approach that supports all the stakeholders – from farmers, processors, and traders to food companies, retailers, and eventually the consumer.

At WayCool, we believe that innovations guided by smallholder farmers, adapted to local circumstances, and sustainable for the economy and environment are necessary to ensure food security.

Farmers must also diversify production in order to cultivate a variety of crops that enhance nutrition and are more resilient to external factors. Governments need to help farmers find the right balance between food and cash crops, and adopt climate-smart agriculture practices. Traditional farming methods like tilling and crop rotation must be combined with scientific techniques to support productive food systems.

Investing in agricultural research will prepare us for future challenges, including natural and manmade threats, as well as expand and protect economic opportunities for rural communities.

Busting India’s ‘Food Scarcity’ Myth

Posted on October 11th, 2023

India is among the world’s leading producers of milk, food grains (cereals and pulses), and fruits and vegetables. In addition to these products, our country also produces ample quantities of sugarcane, cotton, fish and poultry. That India has a food scarcity problem because we do not produce enough is a myth.

In 2019-20, India’s total production of food grains reached a record high of 296.65 million tonnes and total horticultural production peaked at an all-time high of 320.48 million tonnes.

The real crux of India’s food scarcity issue is its fragmented supply chain that makes the entire agricultural ecosystem complex for all stakeholders. It takes anywhere between 7 to 11 steps for food to travel from farm to fork i.e., from the farmer to the consumer!

Moreover, the lack of seamless information flow between stakeholders of the agri value chain poses a major hurdle. Timely and accurate information must be available with all market participants in order to avoid high levels of food loss. The limited demand visibility with food producers results in disrupted supplies, volatile prices, low remuneration for farmers, and uncertain supplies and prices for discerning consumers.

According to a UN report, an estimated 931 million tonnes of food was wasted globally in 2019 with India alone losing food equivalent to the total amount of food consumed by Brazil.

To rejuvenate the country’s food economy, India needs to reimagine a tech-driven supply chain that:

  1. Ensures all market participants are seamlessly interconnected on a single, unified tech platform that facilitates real-time information availability.
  1. Provides integrated Artificial Intelligence (AI)/Machine Language (ML) analytics tools that optimises the entire supply chain, and
  1. Automates a major chunk of the supply chain for enhanced productivity and faster and agile handling of perishable products.

An integrated ecosystem for all stakeholders

An integrated tech platform is pivotal for supply and demand planning at both macro and micro levels. Such a platform will serve as an ecosystem not just for farmers and consumers, but also for other stakeholders like processors, Warehouse Service Providers (WSPs), logistics providers, and retailers.

By bringing all the stakeholders on an integrated tech platform, not only will we create a cohesive, transparent ecosystem, but also boost efficiencies by eliminating inaccuracies in demand and supply planning.

Leveraging such a platform will help:

  1. Farmers use the available long-term forecasts to grow crops based on a scientifically anticipated demand, and short-term forecasts to understand the forecasted market prices that will help them decide exactly when to harvest.
  1. Millers and processors to plan their processes that are tightly aligned to consumer demands on one side and supply frequencies from farmers on the other side.
  1. Logistics players to develop a cohesive view of what needs to be transported when.

This real-time visibility significantly improves planning and ensures that all stakeholders are working in tandem.

How AI/ML analytics integrated within the platform works

Long-term demand forecasting models will help farmers grow the right crops based on the forecast and the soil content. Several models around growing techniques and packaging practices can also help them accurately predict product yields and enhance their income.

Retailers can leverage the embedded analytics models for consumer insights to understand what commodity sells in a particular community and stock the relevant products accordingly. With advancements in technology, we can even go to the extent of predicting which variant of rice or fruits and vegetables are more likely to be consumed in which street! These detailed insights help retailers stock the right Stock Keeping Units (SKUs) that not only improves their earning capacity but also avoids wastages of slow-moving stock.

For the supply chain players, predictive analytics is core to demand planning. They can use the forecasts and supply information to run network optimisation as well as reduce Food Miles thereby minimising food loss.

Once enough information is fed into the tech platform, it becomes easy to analyse how much produce can be generated from a particular region as well as the consumption pattern in surrounding regions to make a sound decision. The same insights can then be shared with the farmers to make informed decisions.

Automation for an uninterrupted supply chain

When one deals with food and perishables, there are two critical elements from a logistics perspective – ensuring that the produce moves from the source to the consumer in the shortest possible time, and minimising the physical handling of the produce as every human touch reduces the shelf-life of the product.

Automation is not just a strategic lever but an important cog in the seamless management of the entire food supply chain. While we have seen the use of automation in food processing, it still remains sluggish in the rest of the supply chain, barring a few new-age players.

Automation has delivered phenomenal results in sectors such as the automotive and electronics industry. This could make way for frugal engineering solutions that ably support the complex cost structures in the food industry.

There are several use cases for automation in the food supply chain such as robots assisting in base-level functions of moving boxes or crates of the produce along conveyor belts, automated systems for grading, sorting, and dispensing precise quantities of grains as well as fresh produce into packing machines. Companies such as Ocado are building such solutions for developed markets. However, similar solutions are required for emerging markets at cost structures more suited for these markets. Besides increasing productivity, these solutions reduce effort and errors, and improve ergonomics, factors that are as important in emerging markets as they are elsewhere.

Automation can also be used in sorting and grading processes based on the quality of food grains and fresh produce. Examples include IoT-integrated decision conveyor systems that automatically match the supply crates to specific customer orders and allow produce to seamlessly flow through fulfilment centres without any human intervention.

Three is the key

From a process maturity viewpoint, food tech and especially agri-commerce is just evolving from a diagnostic stage to a better defined predictive and prescriptive model. Once this transition is completed, opportunities are immense not only in reducing food wastages but across different elements of the supply chain.

The three key elements – an integrated tech platform, embedded analytics and automated supply chain – must seamlessly interconnect to truly get to the core of solving India’s food scarcity issue. WayCool is consistently working towards it and redefining India’s food supply chain to ensure food security.