<aside> 💡 “Latin America and the Caribbean are the world’s breadbasket and lungs,” Michael Morris, Lead Agriculture Economist @World Bank
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The agricultural industry worldwide is facing dramatic disruption, the demand for food is growing at the same time as its supply is facing unprecedented constraints in both available land, rising energy and labor costs placing downward pressure on business margins. To make matters worse, the frequency and strength of catastrophic climate events are growing, applying more pressure on supply chains, retiring entire agrarian regions with a single drought, and manipulating the seasons, and corresponding yields. Amidst these global trends, Latin America presents ground for optimism having raised agricultural productivity (yields) faster than any other developing region. The path that agriculture innovators forge in the coming years, and the technological interventions they build will have distinct implications for the health and wellbeing of the population.
Latin America has historically been limited by high market fragmentation, small batch farming practices, and large scale subsidies keeping incumbents in operation. Most farms, even if large-scale commercial, lack the funding, implementation resources, ongoing management expertise, or data to inform and scale a digital transformation of their production, and time to experiment. This has historically turned away innovation and yet more recently, we have observed a transformation.
In spite of all the risks faced (or because of them) the Agtech sector is gaining traction in LATAM with over 1,000 startups in the region, accelerating maturity of the space.
Source: YieldLab 2021 report