The Rising Influence of Rising Affluence

[DewDiligence]

(MON)—WSJ write-up on FieldScripts precision farming service:

http://blogs.wsj.com/cio/2014/02/25/for-small-farmers-big-data-adds-modern-problems-to-ancient-ones/

…a new application suite developed by Monsanto Co., called FieldScripts, is supposed to help farmers get more out of their arable land. …FieldScripts takes into account vagaries of sunlight and shade, and variations in nitrogen and phosphorous content in the soil—precise to a ten-meter by ten-meter grid. Monsanto then analyzes the data in conjunction with the genetic properties of their seeds, combines all this information with climate predictions, and delivers precise planting instructions— literally, scripts—to iPads connected to planting equipment in the field. This would allow farmers to pinpoint areas that need extra fertilizer, saving them the cost of spreading fertilizer everywhere, while boosting their yields in areas that have performed more poorly, preventing depletion of nutrients in the soil, and reducing the amount of excess fertilizer that enters the water table, say farmers.

But the investments in technology and the fee for the service can amount to more than what many small farmers can earn in extra yield from their farms. According to Sara Olson of Lux Research Inc., the problem with precision agriculture is “the diminishing returns that come along with costly technologies on smaller farms.”

For a large farm, say 5,000 acres, it’s a different story. Revenues could increase by between $100,000 and $200,000, Ms. Olson estimates. Monsanto’s service will cost $50,000. Total [i.e. incremental] profits will run between $50,000 to $150,000 – easily enough to offset the cost of updating farm machinery.

…Farms have gotten bigger, and fewer in number over the past 50 years, and technology is likely to exacerbate the problem. “Precision agriculture will absolutely continue to favor the trend toward larger farms,” Ms. Olson said.

MON charges growers $10/acre for FieldScrips and an additional $15/acre for climate-prediction analytics furnished by The Climate Corporation, which MON acquired in Oct 2013 for $930M (#msg-92619988).