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We need to be smart about technology

We need to be smart about technology

We need to be smart about technology

Chris Brown of KPMG’s global strategy group outlines some of the risks and opportunities which technology investments present for Irish agribusiness.

In a recently published research paper by KPMG titled Techtonic Shifts, the group looked at the potential effects of a range of new technologies on the agribusiness sector and explored possible responses.

Among the key lessons for Ireland is the need to be patient and not to fall into the trap of chasing the hype. Agribusiness remains a highly localised sector. Solutions which work for harvesting in the American Great Plains do not necessarily transfer well to Waterford, Kildare or Carlow.

Similarly, investing in productivity-enhancing technologies only to reduce price will not produce long-term benefits for producers or processors. Experience also indicates that many of the latest innovations and inventions are doomed to failure.

In some cases, this will be due to flaws in the new technology itself, while in others it will be because the companies behind them don’t have the scale or resources to develop them properly. It wouldn't be the first time that inferior technologies have outlived better solutions due to superior resources.

While early adopters of new technologies can sometimes gain first-mover advantage over market rivals, the associated risk is high, and this is probably best left to the large global players who can afford to take such risks.

For many Irish producers and processors, the best strategy is probably to keep a close watching brief on what is happening outside of Ireland and make incremental investments as and when a technology begins to prove its return on investment.

There is also the question of which kinds of technologies to invest in. The group of technologies explored in the Techtonic Shifts report can be broadly categorised as industry 4.0 technologies, and includes robotics, internet of things (IoT) sensors, artificial intelligence (AI) and data analysis.

All of these technologies are already in use to a limited extent in Irish agribusiness, with Teagasc, for example, leading research and pilot projects to assess how best they can be employed.

Each of these technologies has undoubted potential, particularly when combined, but the question for Irish agribusiness is where they can be deployed to best effect in this country. The answer is to look first to our existing strengths and establish how available technologies can be used to build on them and enhance existing market positions. 

Naturally, technologies which deliver clear productivity improvements cannot be ignored, but the key innovations for Irish agribusiness will be those that can be utilised, directly or indirectly, to enhance brand Ireland’s premium market positioning and reputation for clean, green, high quality food.


The first and most obvious of these is blockchain. The unchangeable nature of blockchain records makes the technology a strong candidate for supply chain management and monitoring. Combined with IoT sensors, blockchain technology can be used not only to track movements but the precise storage conditions of shipments.

It also has the potential to maintain a complete register of ingredients, their points of origin, and their complete history through the production and processing chain.

At a time when increasingly affluent consumers are demanding ever-higher standards of food, not just in terms of product quality but also in relation to production methods, animal welfare, and environmental impact, blockchain could be a game-changer for Irish beef and dairy producers.

What better way to capitalise on the grass-fed production practices employed in this country or build on Origin Green initiatives than through a supply chain technology such as blockchain that delivers 100% traceability?

Ultimately, blockchain could enable the personalisation of a brand story and its provenance right down to the individual farms, or at least specific milk pool regions in case of dairy.

Consumers will be able to scan the label on Irish made cheese with their phone and see information, images or video of a grass-fed dairy farm in the relevant milk pool. While this mightn’t appeal to all customers, tech-enabled brand storytelling is already increasingly popular across many of Ireland’s most important export markets.

Blockchain will require the integration of a number of different technologies. It requires the existence of a critical mass of IoT sensors and supporting controls along the value chain to provide the necessary and reliable input data. While some of the IoT capability may already be growing, the missing piece is the coordinated deployment across multiple companies in a value chain. In the view of KPMG, the application of this technology is still five to 10 years away.

IoT and data analytics at farm level

We’re already seeing the use of soil and water quality information supplied by Teagasc being utilised to assist precision agriculture. New data analytics technologies can guide farmers in the application of fertilisers in terms of timing, quantities, and geography. This can lower input costs for farmers while also improving the environmental efficiency of the farm. The same will apply to planting and grassland management strategies.

Some fears have been expressed that these new technologies will replace the expertise of farmers, reducing them to the position of landowner-overseers. This is not a situation we see coming to pass in Ireland, however. 

It is our belief that technology will augment rather than replace the intuition and know-how of farmers. Farming is not like other industries as no two farms are exactly the same. The differences between individual farms grow more pronounced from region to region and country to country.

While some production systems may lend themselves to automation more than others, this is less the case for Ireland’s mostly grass-based system for dairy and livestock production. Another area where AI and data analytics is coming into play is genomics. Great strides have been made in this area in recent years and this is likely to accelerate.

New technologies will enable better selection for particular traits, which improves the overall environmental performance and efficiency of beef production in Ireland. These gains may be incremental but over time may make a significant different to the greenhouse gas emissions of the Irish beef herd.

Robotics and automation

Automation is set to play an increasingly important role at both processor and farm level. Robotic milking has already gained a foothold in the dairy sector, while many other routine farmyard tasks are being increasingly automated.

In addition, the use of automated or robotic harvesting machinery has the potential to significantly lower the costs of production of certain crops, thereby enhancing competitiveness.

Many of these technologies are in their infancy and remain expensive or unproven. However, if you can put a man on the moon you can build a machine to pick a strawberry. It is only a matter of time before these technologies become sufficiently advanced and costs come down enough to bring them within reach of Irish farmers.

In an economy approaching full employment where skilled farm labour is difficult to find, automation will become increasingly essential for many modern farmers.

At the processing level, the impact of new technologies varies. The use of IoT to monitor and control dairy and beverage production processes has the potential to enhance quality, reduce costs in terms of energy usage and improve production cycles by predicting points of failure in advance and enable timely interventions. The same technology will apply to products such as grains, breads and processed foods.

On the other hand, the complexity and variation in the carcase sizes for beef and pork will make it tougher for robotics to be employed widely in those processing plants for the moment at least. Advances in sensor, machine vision, machine learning and AI technologies mean we are likely to see this change but it will take a decade or so.

While the main impact of robotics and automation may be cost reduction, its ability to enhance quality and improve environmental performance through reductions in energy and water consumption should not be underestimated.


The question for Irish agribusinesses is how best to take advantage of these technologies and avoid being negatively affected by their disruptive effects, especially as larger, international peers make earlier investments.

The most important piece of advice is not to get caught in the technology trap. Investing in a technology without being absolutely clear on how it can add value to your business can lead to expensive mistakes.

Given the early stage of development of many of the technologies outlined in this article, the best strategic approach for Irish farmers and processors is to keep up to date on developments.

Given the scale of almost all Irish agri-enterprises, it is clear that close collaboration will be required if the potential benefits offered by the new technologies are to be maximised. Larger processors in particular should ensure they are up to date on relevant technological developments but should wait until technologies with clear benefits for cutting costs and adding value become affordable before making the investment case.

In short, whatever your scale or enthusiasm for technology, ensure you can deliver real returns on investment in the short to medium term.

Christopher Brown

Christopher Brown

Director, Global Strategy Group

KPMG in Ireland