As the heart of the Canadian prairies, Saskatchewan is proud to be a leader in the emerging industry of agtech. We’ve put together a few points explaining why this sector is so important to Saskatchewan, as well as insights shared by Ian Meier from Agrimatics on how COVID-19 has affected their team and his insights on common themes that have come up in the agriculture and agtech industries:
What Is Agtech?
Agtech—sometimes also referred to as agritech—is an application of the two terms: agriculture and technology. Through the use of software and hardware technologies, agricultural practices are becoming more efficient, productive, and safe. Agtech creates innovative solutions for nearly every step in the food production process, whether it’s producing higher yields with fewer resources, reducing waste or pesticide use, improving food safety, enhancing the quality of crops, precision farming, and more. Food demand is growing, and available land is shrinking, so the way we produce food and move it to market is transforming.
Why Is Saskatchewan a Great Place for the Agtech Sector?
Saskatchewan is home to more than 40% of Canada’s cultivated farmland, making it some of the most productive land in the world. In 2019, our province exported $12.9 billion in agri-food products, and we’re also recognized worldwide for growing high-quality crops, as well as herding the second-largest cattle-producing province in Canada. Saskatchewan is a great place for agtech as our province boasts a talented labour force, with over 52,000 people working in our tech sector overall, and we also have an abundant and increasing number of strong incentives to help companies succeed.
How Has Agriculture and Agtech Been Affected by COVID-19?
In terms of agriculture, there have been different opinions about the challenges that farmers will face this year, but the main point is that there’s going to be a definite shift in demand. Because of the differences in the nature of products, financial returns are sure to change with factors such as corn prices suffering from reduced demand for ethanol due to depressed oil prices. “Farmers have to keep going, and the crops still have to get put in,” Meier says. Considering the current population and as it grows, agricultural sources will remain in demand, so there will continually be a need for farmers to get those crops in as efficiently as possible, all while making better large-scale decisions by way of agtech innovations.
How Have Saskatchewan Agtech Companies Responded to the Pandemic?
Agrimatics shared that they doubled down on product development and reprioritized product plans. As COVID-19 started ramping up, some changes went seamlessly while others presented a challenge. Because Agrimatics has used cloud tools since the beginning, the transition to working from home was easy. Overall, processing facilities have been hit quite hard because of the close working conditions, so everyone has been adapting to work in unique ways to stay safe. With the need to continue physically building their products, the team shifted to manufacturing with minimal staff in the office while keeping everyone else at home. Securing supplies was the greatest struggle but as Meier explains, “When we were forced to change our processes, we turned to local support.” They were able to bring in raw materials internationally and process the final product locally. Although there’s an increased cost for local suppliers, there's security and flexibility in being able to process parts on demand, and they plan to continue with these relationships even after things settle down.
What Does the Future of Agtech Look Like?
“It’s tough to predict what’s going to happen in the agtech industry,” Meier says. There are opportunities to invest in your company’s R&D when the economy is slow, but at the same time, there will likely be cutbacks on actual product development. During this unpredictable time, there is also bound to be unexpected side effects and trends that will influence the future of agtech. There are already many innovations making it easier for information to be shared automatically, which has been beneficial for physical distancing and communicating remotely. Things could go from status quo to a boom, but as of right now, there isn’t a clear prediction.
If You’re a Tech Entrepreneur, Why Should You Care About the Ag Sector?
Innovative tech entrepreneurs pioneer the agtech sector in Saskatchewan, and they are getting more support to do so. In 2020–21, our province will be seeing a $1.0 million investment for an agricultural technology program to drive investment into local early-stage agtech innovations and attract international agtech companies to our province. Thanks to this budget, more manufacturers and tech startups will be able to create game-changing technologies that will contribute to Saskatchewan’s economy.
What Should People Who Want to Start a Tech or Agtech Company Know?
The main goal should be to build a sustainable business. There are plenty of opportunities to grow your business organically without needing to rely on risky outside investments. While working with VCs is a fit for some people, not everyone likes to be tied to someone else’s decisions and forced to grow at all costs. Investments dry up, so focus on selling to your customers by building a great product that people will pay for. “The best money to raise is money from your customers,” Meier mentions. Think “revenue is vanity, profit is sanity, and cash is reality.” With slow growth, you’ll be able to weather the storm—like the COVID crisis that we’re facing right now.
For those looking to get more involved in the agtech sector, dig into agricultural resources, funding options for technology companies, and learn from other entrepreneurs and companies in the industry. If you have any questions about agtech or how you can position yourself in this booming industry, don’t hesitate to contact us.