Tom Shapland

AgTech Ecosystem - I'm putting some slides together on CA labor and wanted to share some of my findings: 1) California growers hire 850,000 unique farm workers per year, or 425,000 full-time equivalents (FTE) (UC Davis - Phil Martin). My analysis shows that CA growers spend $16.3 billion for 850 million hours of work (425,000 at FTE rate of 2,000 hours/year). This provides a blended average of $19/hour. 2) Much of the increase has come from an 8x lift in regulatory costs in 12 years (from $109/acre/yr to $977/acre/yr). This is from Lynn Hamilton's work at Cal Poly. Much of this increase shows up as higher labor costs (3 main factors: food safety - LGMA + FSMA; Obamacare; minimum wage, overtime, and break rule changes). These numbers were from 2005 to 2017 - it's gone up since then but 2017 was the last deep dive Lynn made. 3) Lack of domestic farm workers has pushed H-2A immigrant farm worker usage up 8x in 18 years (48k in 2005 to 378k in 2023) (Dept of Labor). In California, the H-2A number is 44,000 for 2023 (a 3x lift in 5 years), which makes the labor split 90% domestic and 10% H-2A. This is how you get to the $19 blended rate - 90% is at CA rate of $17.25 and 10% is at H-2A rate of $28/hour ($19.75 AEWR - increasing 5=6% per year + housing and transport of $6-8/hour). 4) Most growers in CA I talk to believe that their and statewide usage of H-2A is more likely to increase than decrease because they see now change in domestic workforce availability. So if H-2A goes up another 10% in the next 3-5 years (to 88k total), that would push the average hourly cost of CA labor up another $1 or more. For example, if the mix shifts to 20% H-2A and the AEWR goes up 5% per year for two years (10%), the blended hourly rate goes to roughly $30 (higher if housing and transport goes higher). If you're an AgTech startup, this means two things: 1) Your TAM for solving a portion of the labor problem is going up as the H-2A usage is going up. You just need to figure out how many hours your solution can help the growers to provide some relief for H-2A costs. 2) Grower's margins will feel ongoing pressure as the H-2A usage and blended cost per hour goes up. So they will be less interested in buying AgTech until you show them the math all the way through from the viewpoint of a comparable sized operator. Your sales team needs to do the work of figuring out their actual labor mix and the actual hours used, then providing the improved math from integrating your solution. It's more of a consultative sell, but it's a better (and likely longer) sales process. I'll get a Google Doc out later with the details. For now, I wanted to share the numbers with you. I welcome questions - first draft at some of this math - there are likely some additional items that could stand to be figured into the model. Rhishi P. Sachi Desai Rob Trice Carter Williams Lynn Hamilton Jennifer Marston #agtech #growereconomics #mathmatters

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California's processing tomato industry has been through a wild couple of years. With post-pandemic demand normalization now on the horizon, according to our specialty crop analyst, Matt Woolf, how will that affect growers' break-even yield in 2024? Matt shared his forecast and other key insights this month at a roundtable event hosted by American AgCredit and Terrain. According to Matt, the pandemic juiced demand during a time of restricted supply, leading to the highest price for processing tomatoes the industry had seen. However, he expects demand conditions to start normalizing now given: ◾ A more structural decline in per capita demand ◾ Challenges of competing in the export market One sign of demand softening is the recently announced grower price per conventional ton of $112.50, down from last year’s $138. Though the break-even yield can differ widely by operation, Matt's analysis using UC Davis cost studies and California Tomato Growers Association prices suggests the average break-even yield in 2024 is approximately 27% higher than it was last year. Although the price has fallen from last year, Matt states that it is still the second highest on record, meaning 2024 could be a very good year for tomato growers. 📣 Stay tuned for more from Matt on processing tomatoes. #CaliforniaAgriculture #Tomatoes

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Check out the precision ag webinar to leverage forecast data.

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If you care about butterflies, you might want to check out this definitive preprint paper regarding nectar plants for US butterflies. https://lnkd.in/gB96CVJq

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What do you pay for high resolution #plantstand counting? #swatcam is $0.50/ac 🇨🇦 or $0.38/ac 🇺🇸 and utilized by farmers with #swatmaps to define the “why” of the reason they are high or low. Perfect for precision targeting of plants in your VR seed rate and hybrid/variety prescriptions in #precisionagriculture https://lnkd.in/g9AtC_ak

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To maximize crop yields, uniform growth in production systems is a key consideration. In the example below (from our collaboration with Cal Poly Strawberry Center), all three strawberry beds have near identical overall leaf area; however, the uniformity measurement tells a different story. The variations captured by this metric can reveal underlying root cause issues that can be identified and optimized. Uniformity can capture differential responses to abiotic/biotic stressors, management practices, and product responses. In addition, it can be used as a QC co-variate to identify places where there are technical issues with data points (planter issues, weed infestation, plant damage). More vigorous plants can sometimes compensate, but in many cases there is an overall yield drag. Monitoring uniformity by eye during field visits is subjective and challenging to quantify. Many researchers rely on a "plot quality" visual rating, but in my experience that is difficult to capture systematically. Here is where digital metrics come in: we can leverage this approach to efficiently flag data points that show deviations, and deal with them accordingly. #remotesensing #digitalag #fieldresearch #agribusiness

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AgTech Ecosystem - continuing research on the state of CA ag. This post and a few follow-ups will cover some findings on the irrigated acreage in California. Data is from USDA Census (which release every 5 years) and right now is for 2012, 2017, and 2012. I will get it backed up to 1997 for comparison to overall acreage (irrigated, dry farming, and range land) and do some comparison to CDFA annual data releases. DAta is in "2012 v 2017 v 2022 irrigated" tab. This post will cover farmer count - subsequent posts to be done on acreage counts by segment. Here's what we know for farmers: 1) Overall farmer count went from 53,546 (2012) to 52,362 (2017) to 46,247 (2022). That's a 7,299 drop - or 13.7%. That's a pretty big drop in only 10 years and it was far more pronounced in the most recent 5 years. Again, I want to back the data set up a few more USDA Census reports to 1997 to see how the trend looks over 25 years. 2) The USDA data divides farms into 13 segments from 1-9 acres all the way up to 5,000+. The only acreage segments that showed growth over the 10 years were 1,000 to 1,999 acres and 2,000 to 4,999 acres. For the 1,000-1,999 acre farms, the count went up by 1,514 (8.1% increase). For 2,000-4,999 acre farms, the count went up by 1,091 (16.6%). Interestingly, the 5,000+ acre farms went down by 502 (7.7%). 3) Nine (9) of the 13 categories saw a decrease over the 10 years and six were 10% decrease or more. Three of the hardest hit were the smallest categories - 1-9 acres, 10-49 acres, and 50-69 acres experienced 16%, 19%, and 17% losses. 4) The 3 smallest acreage segments represented 62% of CA farms in 2022 and the 3 largest acreage segments represented 6% of CA farms. The short conclusion on the farmer side is that it remains very challenging to continue operating as a small acreage farmer in California. I do not see any data points at the moment that are likely to change that. The economic benefits of being vertically integrated or operating more acreage continue to be significant. The regulatory challenges that continue to be imposed on California farmers impact small farmers the most. These numbers do not paint a great picture of California ag from the farmer perspective. I'll be back with acreage analysis later, and then some comparison to the overall picture (irrigated v total). https://lnkd.in/gBATxNWY

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As we see yet another Indoor Vertical Farming failure tarnish our great #CEA industry, I return to the most fundamental truth of successful CEA production: This is FARMING. Period. Full stop. I'm amazed that I still have to say it. Any farmer must skillfully balance the critical intersection of crop productivity with efficient economics. In a nutshell, both your technological and management choices MUST adhere to correct horticultural science AND appropriate farm economics. All of your tools -your systems, controls, equipment, and cultivation methods - need to serve the needs of those two components. (Every IVFing failure can be traced to that neglect!) Yes, it might seem cool to try and "reinvent the wheel," but as we have seen (time and time again) it never works. #SuccessLeavesClues #CEADoneRight! #NatureToBeCommandedMustBeObeyed www.AmHydro.com

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Too much go-to-market advice for companies in #agriculture stinks. It’s rooted in flawed thinking. Many companies get advice that assumes: If you build it, they will come. But customers almost never grasp your product's essence or why they should part with their cash for it. You need to reshape their perspective. Traditional go-to-market tactics? They're tailored for established markets. They assume you're: - Vying for market share. - In a known category. - Offering an incrementally better product. But here are some questions to ponder: ❓ In 1870, what did market research say about tractors? ❓ Was there a competitive breakdown on Roundup Ready beans in the 80’s? ❓ What were opinions on auto-steer in the 90’s? Traditional tactics falter when crafting a never-before-seen concept. They can't help when there’s no budget allocated for your innovation, nor can they redefine the problem you solve for customers. And research tells us that in technology categories, the category king normally takes about 76% of the market capitalization. Because no one remembers the also-ran, they only remember the winner. So if your go-to-market is not built to design a new category of your own - one you are uniquely qualified to define and dominate - then you’ll be letting someone else set the conditions for the way you communicate with your customers. And that's a bad plan for success. Instead, you need to build your go-to-market to have the conversation with your customer on the terms you establish You need to move the thinking in the industry from where it is today to where you want it to be. This should impact the way you price your product, the way you promote your company, and the methods you use to place your solution in front of the target customer. - Stop robbing your future valuation in the name of scaling the distribution of users. Upselling later is harder than it looks today. - Stop softening your market differentiation by selling through an existing distribution network. The channel usually won’t save you unless their is market pull for your product downstream. - Stop hiring salespeople and expecting that they’ll be ready to “just sell.” Early sales depend on organizational learning and renaissance team members who are willing to take the time to educate the customer. Remember, almost nothing is more important to the future value of your company than the way you build your #gtm today. Start investing in your story as if it matters. Start designing your category. Make something different. Make people care. Make fans, not followers. #agtech #gotomarketstrategy #agribusiness #categorydesign

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Another giant falls. 🌱 **Navigating the Future of Vertical Farming** 🌱 It's no secret that the vertical farming industry has faced significant challenges recently, with several companies shutting down due to financial challenges. While this news can be disheartening, it's also an opportunity for us to learn, adapt, and innovate. The closure of companies like Bowery Farming and AeroFarms reminds us that the path to sustainable agriculture is not without its obstacles. However, it also highlights the importance of resilience and the need for new, more efficient models. As we move forward, let's focus on the lessons learned and the potential for growth. Vertical farming remains a promising solution for food security and sustainability, especially as we continue to refine our methods and technologies. Together, we can build a brighter, greener future. 🌿✨ #VerticalFarming #Sustainability #Innovation #Resilience #FutureOfFarming

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AgTech Ecosystem - continuing the conversation around the ag labor challenge in California, here is a look at the next slide - this is a forecast slide around two key metrics: acreage lost and farmers lost over 55 years. 1) The first 25 years (1997-2022) are using the actual USDA data from the 5-year census reports and are the bars to the left of the red line for acreage (left side) and farmers (right side). The next 30 years are forecast using the trend lines established in the first 25 years of actual data. I have also done a Google Doc with analysis and all the details that I will include a link to in the first comment. 2) The acreage loss is forecast for 9 million acres over 55 years, from roughly 29 million acres to less than 20 million acres (32% of total acreage lost). This is for all forms of ag - irrigated specialty crops and hay crops, livestock, and dairy. The Google Doc has a tab analyzing irrigated acreage since this is where most of the high-revenue specialty crops are grown. 2) The farmer loss is even more pronounced - forecast at 45,000 farmers lost over 55 years (51% of total farmers). Combine these stats and you can see the trend line - California loses roughly 200,000 acres and 1,000 farmers every year. 3) See the 2012 v 2017 v 2022 Irrigated tab for 10 year irrigated analysis. The only acreage sizes that showed farmer growth are the 2,000-4,999 acres (+16.6%) and 1,000-1,999 acres (+8.1%). The lowest 6 tiers (1-9, 10-49, 50-69, 70-99, 100-139, and 140-179) all had double digit farmer loss (10%+ or more) except for 70-99 (9.5%). The data trends are clear - 7,455 small farmers (bottom 6 tiers) were lost in 10 years. 4) The acreage count for irrigated tells a similar story - only four tiers (260-499, 500-999, 1,000-1,999, 2,000-4,999) - 22%, 13.5%, 4.9% and 4.6% growth from high acreage count to lower. Every other tier had a net acreage loss, and 4 of the smallest 5 tiers were double digit acreage loss (>10%). This data is key for policy maker strategies: 1) Acreage count matters more than farmer count - the acreage drives the GDP of ag products that feed production facilities and support AgTech innovation. You can justify subsidies to protect small farmers (sort of), but the ROI for payments to establish new small farmers with rough economics looks tough to justify. 2) If you still want to argue for government funds for establishing small farmers, I'm going to need to see some math. What does it cost to establish a small farmer and what do the long term economics look like? Finally, the economics of a W-2 for AgTech workers over 5 years with raises and benefits looks pretty encouraging relative to 5 years of ag operator economics. Rhishi P. Sachi Desai Rob Trice Rob Dongoski Tim Nuss Norm Groot Jynel Gularte Carter Williams Danny Bernstein Damian Mason Todd Thurman Natalie Kovarik Tara Vander Dussen

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Addressing California's Ag Labor Crisis with Smart Precision Automation 🌿 The WG organization's latest insights reveal a severe labor shortage threatening California’s agricultural sector on tasks like pruning, cuttings, and harvesting. Today's dependency on labor only risks the farm's future. 🌎 Farms under Global Competition: As countries like Peru advance their agricultural infrastructure, California must innovate to stay competitive. ⏰VineRobotiqs has plans for cutting labor costs by 50% and providing key features to increase yield by an additional 50%. California farms will now be winning everywhere. 👥 Join Our Vision: We invite investors and industry partners to explore how VineRobotiqs can be part of the solution to revitalize California's agricultural landscape and beyond. Let’s discuss how we can turn these challenges into opportunities for growth and innovation. #AgTech #SustainableAgriculture #Innovation #CaliforniaAgriculture #InvestInAgTech

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AgTech Ecosystem - let's dig into the numbers behind the ag labor challenge in California. 1) CA hires a lot of farm workers to work a lot of hours - $16.3B for 850M hours in 2023 at a blended rate of $19/hour. There are 850,000 unique farm workers and 425,000 full-time equivalent (FTE) farm workers per year. Between 60-75% of the labor is on harvest and the remainder (25-40%) is on cultivation. 2) There has been an 8x lift in regulatory costs over 12 years (Cal Poly study between 2005 and 2017 for leafy greens) from $109/acre/yr (2005) to $977/acre/yr (2017). The three largest drivers of the increase were food safety (LGMA and FSMA - recall the spinach challenges in 2005), health care (Obamacare), and labor changes around minimum wage, overtime, and break rules - each of which were larger than the $109/acre/yr in 2005 when the 2017 results were analyzed. 3) The lack of domestic availability means H-2A (immigrant farm worker) usage has seen an 8x lift nationally (from 48,000 in 2005 to 378,000 in 2023) while CA has gone up 3x in 5 years to 44,000 in 2023. So 90% of CA farm workers are domestic at an average price of $17.25 and 10% are H-2A at an average price of $29/hour ($19.75 AEWR - adverse effect wage rate - plus housing, transportation, and meals). This makes the blended cost $19/hour and the average AEWR rate the last several years has been 5-6%. For every 10% lift in % towards H-2A, the blended hourly rate goes up by $1/hour. 4) Final cost - PAGA (Private Attorney General Act) deputizes private attorneys to find and file class action suits against all hourly farm worker industries (not just ag). This has proven to be a very beneficial act for attorneys - the growth in PAGA lawsuits since it's inception in 2004 has been 1,440% and the case count was over 5,000 in 2022 with an average settlement of $1.1M. So all of these factors add up to make CA specialty crop farm workers some of the most expensive labor on the planet, with no end in sight. $30/hour labor for farm workers isn't a future risk - it's here right now, especially if the H-2A AEWR rate goes up 5-6% and/or housing/transportation/food continue to increase. For comparison shopping for those that are curious (more in a future post), the going rate for Peruvian farm labor is around $32-40 per ... day (yep - $4-5/hour). Now look back at the first item - $16.3B for 850M hours. Realize that each hour that relocates to Peru saves a grower $25 in costs. Extrapolate that out across an entire growing rotation or season and you can see the financial impact relocating acres has on specialty crop operation costs. California policy makers may not understand the opportunity this presents for other growing regions, but Peru policy makers definitely understand the opportunity and are working hard to capture it. Rhishi P. Sachi Desai Rob Trice Tim Nuss Norm Groot Jynel Gularte Rob Dongoski Carter Williams Danny Bernstein Damian Mason Todd Thurman Natalie Kovarik Tara Vander Dussen

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It is great connecting with fellow industry professionals at the NW Hort Expo in Yakima! 🍎 Pacific Biocontrol presented a helpful overview of the distinctions between Codling Moth and Oriental Fruit Moth. A video summary by Peter McGhee, Pacific Biocontrol president and entomologist, below. Erica Moretti’s, USDA entomologist, presentation on biocontrol best practices was also a highlight. Biocontrol, along with pheromones, play a crucial role in integrated pest management for orchards. #NWHortExpo #PacificBiocontrol #CodlingMoth #OrientalFruitMoth #Biocontrol #IPM #PestManagement #Entomology

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The 6 problems you get from asking consumers about regen ag As regen ag continues to gain momentum as a leading model for sustainable agriculture, a European study shows that consumers are curious to learn more. But the survey also serves to illustrate that the food system cannot be easily fixed. It faces complex and interconnected challenges that require fundamental, systemic changes.

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In between managing pests, planting new varieties, and tinkering with technology, it's important to take a step back and consider where your business is headed. Here's Greenhouse Grower's latest Digital Deep Dive on Business Management! #Floriculture #Horticulture #Business #Management

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(USA 16.09.24) #growingproduce #agtech Top 50 Ag Tech and Food Tech Listings for 2024. SVG Ventures | THRIVE https://lnkd.in/gAWMn2BV has published its 2024 THRIVE Top 50 Ag Tech and Food Tech list, showcasing the world’s most innovative, venture-backed companies transforming the global agri-food value chain. Now in its seventh year, the report highlights significant shifts, with over half of the featured companies being new, emphasizing rapid innovation in ag tech and food tech. The Top 50 companies were selected for their leadership, cutting-edge technology, investment potential, and market impact. These organizations set the industry standard, covering sectors like Controlled Environment Agriculture, Animal Technology, On-Farm Automation, Novel Crop Inputs, and Agribusiness Platforms. SVG Ventures CEO John Hartnett praised these companies for their critical role in driving industry change. Meister Media Worldwide https://lnkd.in/gQzis_QS partnered as the official media sponsor for this year’s report. https://lnkd.in/gZEABmBJ

Are nutrient deficiencies, pests, and unpredictable weather patterns holding you back in your farming journey? You’re not alone. Every farmer faces these challenges, but there’s a natural ally ready to help: biofertilizers! What Are Biofertilizers? Biofertilizers are microbial inoculants packed with beneficial microbes, such as bacteria, fungi, and algae. They can be applied to seeds, used as a root dip, or incorporated into the soil, enhancing crop productivity in several ways: Boosting Nutrient Uptake: They help plants absorb essential nutrients more efficiently. Increasing Stress Resistance: They enhance crops’ resilience against drought and pests. Why Use Biofertilizers? The benefits are remarkable: Nutrient Fixation: They make essential nutrients more accessible to plants. Enhanced Crop Yields: More nutrients mean better production. Soil Health Improvement: They restore vital microbial activity in the soil. Biological Pest Control: They aid in managing harmful plant pathogens, reducing reliance on chemical pesticides. Types of Biofertilizers: Nitrogen-Fixing Bacteria (NFB): Boost nitrogen availability in soil. Phosphate Solubilizing Bacteria (PSB): Make phosphorus more absorbable. Potassium Solubilizing Bacteria (KSB): Enhance potassium availability. Zinc Solubilizing Bacteria (ZSB): Increase zinc accessibility for plants. Mycorrhiza: These beneficial fungi form symbiotic relationships with plant roots, improving nutrient and water uptake while enhancing soil structure. Don’t let agricultural challenges stifle your growth. Embrace biofertilizers to improve plant health, increase yields, and promote sustainable farming practices! 🌾✨ #Biofertilizers #SustainableAgriculture #CropHealth #AgricultureInnovation #SoilHealth #Mycorrhiza

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