Digital Agriculture in LMICs - 11 Jul #22
Indonesia’s eFishery bags $200 M, becomes largest aquatech globally, while Eratani doubles up on funding; in Africa telco giant Safaricom eyes agritechs
06/07/23
Agritech investments in target for Safaricom’s new ventures
Kenya-based telecoms company Safaricom is planning to launch two venture capital firms to invest in African startups, including agritechs. Safaricom wants two incorporate the two new companies. One will be investing in seed stage start-ups. It will be in fact the repurposing of an existing subsidiary, which is currently running Safaricom’s Spark Fund. The other company will be a newly created one named Venture Co, with the purpose to invest in growth stage startups.
The move is a shift from Spark Fund, which Safaricom started in 2014 to support Kenyan tech start-ups using mobile technology. Spark Fund has invested in the agritechs iProcure and Farmdrive. The telco plans to recapitalise any gains from the investment portfolio back to Safaricom PLC. Just in June, the International Finance Corporation (IFC) said that it was planning to invest KSH 21.8 billion (USD 156.9 million) in Safaricom, in exchange for 7.25% of the company’s equity. IFC is also providing a KSH 13.9 billion (USD 100 million) loan to the telco giant.
07/07/23
Indonesia’s eFishery confirms $200 M funding, reaches $1.4 Bn evaluation
Indonesian aquatech eFishery has finally confirmed the details of its latest Series D funding, following a series of reports in the last two months. The aquatech stated that it has raised IDR 3 trillion (USD 200 million) in a round led by 42XFund, a global investment management company based in Abu Dhabi, with support from Kumpulan Wang Persaraan, Malaysia's largest pension fund, Swiss asset manager Responsibility and 500 Global. Early eFishery investors such as Northstar, Temasek, and Softbank also participated in the round. The company is now reportedly the first aquatech globally to reach a valuation of USD 1.4 billion.
The fresh funding will be used for community development of fish and shrimp farmers. The aquatech targets 1+ million aquaculture ponds in Indonesia by 2025. Quoting research from the University of Indonesia, the company said it contributed IDR 3.4 trillion, or 1.55% to the GDP of the Indonesian aquaculture sector throughout 2022. Established in 2013, eFishery initially developed an IoT-based smart pond management system, and has over time expanded to an end-to-end solution enabling farmers to access markets. It has to date secured USD 298.6 million in funding.
10/07/23
Eratani raises an additional $2 million in Indonesia
Indonesia’s agritech startup Eratani has raised a further USD 2 million in seed funding, after securing USD 3.8 million back in December. The latest injection of cash takes Eratani to a total of USD 5.8 million raised in its seed round. This round saw the participation of Japan-based SBI Holdings through its joint venture with NTUitive and Kyobo Securities. Other investors were Genting Ventures, Orvel Ventures and Ascend Angels.
Eratani’s mobile platform is a one-stop-solution providing farmers with data driven advisory, financing, crop processing access and market linkages for quality inputs. According to reports, the start-up currently supports a network of 20,000 rice farmers in five provinces (West Java, Central Java, East Java, Banten, South Sulawesi). Founded in 2021, the Indonesian agritech has to date raised USD 7.4 million.
In other news..
04/07/23
IFFCO to deploy 2,500 agricultural drones in India
The Indian Farmers Fertiliser Cooperative (IFFCO) has announced plans to procure 2,500 agricultural drones to provide efficient spraying services of its liquid fertilisers to farmers. IFFCO is targeting to onboard 5,000 rural entrepreneurs to operate the drones, which are expected to be able to cover 20 acres per day. IFFCO is also deploying 2,500 electric three-wheelers to carry the drones to the farmers’ fields. IFFCO has a long history of deploying digital agriculture solutions. Since 2011, it has partnered with telecoms giant Bharti Airtel by creating the joint venture IFFCO Kisan Suvidha Limited, which provides agritech solutions to farmers such as the IFFCO Kisan Agriculture App, and Kisan call centre. IFFCO operates 115 farmer centres serving 50 million farmers.
05/07/23
Rockefeller Foundation to support agritech adoption by Indian smallholders
In a new report, The Rockefeller Foundation and Indian nonprofit organisation The/Nudge Institute said that Indian agritechs are struggling to reach smallholder farmers. The study named Smallholder Farmers and Climate Change – Voices from the Field outlines the climate related challenges faced by the rural population. It highlights that agritechs are increasingly targeting mid and large farmers but not smallholders, as it is difficult for their business models to serve them commercially. The report focuses on six states where the Foundation is supporting 22 million smallholders, defined as those who possess 1-2 acres of irrigated land or 3-7 acres of rain-fed land.
The Foundation aims to integrate the intelligence from the report into its work on testing and scaling regenerative and nourishing food systems. Based on the findings from the study, it is planning to build agritech capacity (commercial viability, distribution of solutions, adoption at scale) to reach smallholders. An interesting finding of the report is that the incidence of spraying pesticides and the usage of chemical fertilisers has more than doubled for 76% and 54% of small farmers, respectively.
06/07/23
Good reads: OECD and FAO launch Agricultural Outlook report for 2023-2032
The Organisation for Economic Co-operation and Development (OECD) and the Food and Agricultural Organization (FAO) of the United Nations have published their latest Agricultural Outlook report for 2023-2032. The report offers an assessment of the ten-year prospects for agricultural commodity and fish markets at national, regional, and global levels, and serves as a reference for forward-looking policy analysis and planning. This year’s Outlook demonstrates that rising fertiliser costs can lead to higher food prices. A scenario analysis estimates that for each 1% increase in fertiliser prices, agricultural commodity prices would increase by 0.2%. Global food consumption – the main use of agricultural commodities – is projected to increase by 1.3% per year over the next decade, a slower pace than the previous decade due to the foreseen slowdown in population and per capita income growth. The report is prepared by FAO and OECD with inputs from member countries and international commodity organisations.