Demand for Precision Farming Forecast to Grow 9.8% Annually Through 2026

Posted by Tom C on July 14th, 2021

Precision farming/smart farming could ensure high returns for agribusiness if used to its complete potential; it can help farmers battle the negative effects of nature on crops by collecting geospatial data of soil, livestock, and plant, and other inter-and intra-field information. Precision farming also provides inputs about the requirements for irrigation, liquid fertilizers, nutrients, herbicides, and pesticides, thereby reducing the wastage of resources and the overall cost of farming.

The global agriculture IoT market is estimated to grow from USD 11.4 billion in 2021 to USD 18.1 billion by 2026 at a CAGR of 9.8% during 2021–2026. The growth of the agriculture IoT market is driven by factors such as increasing adoption of the Internet of Things (IoT) and artificial intelligence (AI) by farmers and growers, growing focus on livestock monitoring and disease detection, high demand for fresh produce, population growth, loss of arable land, surging adoption of aquaculture monitoring and feed optimization devices in developing countries, and strong government support for precision farming practices.

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The advent of advanced technologies such as guidance systems, variable rate technology, IoT, AI, and remote sensing has transformed the agriculture industry into a technologically intense and data-rich industry. Smart agriculture technologies assist in increasing profitability, improving sustainability, protecting the environment, and minimizing the consumption of resources such as water, fertilizers, and energy. IoT is implemented in various applications, including precision farming, livestock monitoring, precision aquaculture, smart greenhouse, and precision forestry.

IoT and AI are helping farmers and growers optimize their crop yields and promote better livestock health through remote monitoring and data-driven decision-making. The global population is increasing at a high rate. According to the Food and Agriculture Organization (FAO), the global population is expected to reach 9 billion by 2050, which would lead to a surge in demand for food, with food production likely to double between 2014 and 2050 to keep up with population growth. Governments, globally, are encouraging farmers to adopt smart agriculture practices by increasing agricultural budget amounts and providing guidance at different levels to increase food production with limited resources such as land, fertilizer, and water. The advent of big data in agricultural farms, the introduction of agriculture-specific applications in smartphones, and the adoption of drones in precision farming are the major opportunities for the agriculture IoT market. However, the unavailability of simple and standardized data management and data aggregation tools and lack of standardization in the agriculture industry are a few challenges for this market.

The precision aquaculture application segment is projected to register the highest CAGR during the forecast period, by application. Increasing demand for real-time tracking of fishing activity is the major reason behind the high growth of the agriculture IoT market in aquaculture farm monitoring applications. Additionally, increasing government support worldwide for freshwater aquaculture production, and growing investments in technological research and product innovations to further boost the demand for the market.

Theautomation and control systems segmentof the agriculture IoTmarketfor precision farming hardwareis estimated to register the largest market share in 2026, by hardware type. The increasing demand for drones/unmanned aerial vehicles (UAVs) is a major reason behind the high growth of the market for automation and control systems. Also, the increasing adoption of automation and control devices such as GPS/GNSS, irrigation controllers, and guidance and steering systems is expected to drive the market for automation and control systems.

The small size farms segment is projected to register the highest CAGR during the forecast period, by application. The agriculture IoTmarketfor small-size farms is projected to register the highest CAGR during the forecast period, by farm size. Small farms are expected to adopt automation and other advanced technologies at the highest rate in the coming years due to the reducing cost of farm automation equipment and advancements in technology that make it more feasible to deploy automation tools even on smaller farms to achieve high returns on investments.

The production planning stage segment of theagriculture IoTmarket is estimated to register the largest market share in 2026, bythe farm production planning stage.Farmers are extensively using agriculture IoT hardware devices for monitoring and data analytics applications in order to formulate data-driven strategies to maximize profits. Data pertaining to production processes, crops, and equipment is collected with the help of sensors. This data is stored in the cloud, and data analytics solutions generate insights with such data. Farm owners can leverage these insights and make important decisions about their farms.

APAC is expected to witness the highest CAGR in the agriculture IoT market during the forecast period. Agriculture IoT techniques are expected to be adopted at a high rate in APAC. This region consists of emerging countries such as India, China, and countries in South East Asia. Rapidly growing population, availability of arable land, and strong government support for farmers through subsidies in these regions are the major factors driving the adoption of agriculture IoT technologies in APAC.