ADM, Bunge, Cargill, and Louis Dreyfus Partner to Bring Tech to the Grain Supply Chain
ADM, Bunge, Cargill, and Louis Dreyfus, the four global behemoth agribusinesses known as the A-B-C-D’s, announced they are partnering to pursue ways to use technology to digitize and standardize the global agricultural commodity value chain.
Understanding that the integration of technologies such as AI and blockchain will provide opportunities to increase transparency and efficiency for customers while also reducing resource and time-intensive processes for suppliers, the companies also are seeking broad-based industry participation in support of global access and adoption.
“We expect an industry-wide initiative of this nature to be able to accelerate improvements in data management and business processes, and bring much-needed automation to the industry,” said Soren Schroder, CEO, Bunge. “Promising technologies will not only provide synergies and efficiencies for ourselves, we believe they will prove vitally important to serving customers better by laying the foundation to enable greater transparency.”
As an initial goal, the four companies will focus on technologies that work to automate grain and oilseed processes that occur post-trade, as these are often the most manual and high-cost points of the supply chain. This first step will work to shorten document processing lead times, reduce wait times, and improve end-to-end contract visibility.
Longer vision goals include a more digital-based approach that will eliminate other manual and paper-based processes having to do with contracts, invoices, and payments to create greater reliability, transparency, and efficiency.
Within this framework, specific targets include:
Improved quality and reliability of documents and data, with reduced review time and seamless transfer of transaction data to customers;
Greater visibility across supply-chain movements underpinning transactions, leading to reduced costs associated with shipping, storage and wait times;
Standardized data using technologies accessible to all players, driving further efficiencies;
Compatibility with other applications supporting electronic and digital solutions, providing an end-to-end experience for users; and
Increased efficiency and transparency, enabling the industry to better serve its customers and consumers.
“We’re pleased to join the effort to foster modernization and standardization of data and documents in the global agribusiness value chain. By working together to design and implement a digital transformation, we will bring hundreds of years of collective knowledge and experience to simplify processes and reduce errors for the benefit of the entire industry,” said Juan Luciano, chairman and CEO, ADM.
The Promise in Precision
Grain has been the focus of more than one investment round or strategic partnership since the beginning of this year. After years of bumper crops and significantly lower commodity prices have caused farmers’ margins to disappear, the promise that digital ag platforms can provide farmers with higher returns per acre and improve margins for handlers is attractive.
In January of this year, BlockGrain, an Australian agtech-blockchain startup, raised the equivalent of approximately $1 million in cryptocurrency from the $90 million NEM Blockchain Investment Fund.
Founded in 2014 on Australia’s Gold Coast by fifth-generation farmer, Caile Ditterich, BlockGrain is an agricultural supply chain tracking company. Through its integrated logistics platform, the startup provides greater transparency to grain farmers, helping them determine grain quality, connect with global markets, better navigate the supply chain, and improve margins.
“BlockGrain was created with the mission to solve real life problems faced by the agriculture industry today,” said Ditrich in January. “We know that the complexity of the supply chain coupled with lack of meaningful information and data result in major efficiency and productivity issues for our farmers, brokers and logistic companies.”
Five months later, in May of this year, Bushel, a company that provides a software platform to allow grain elevators, cooperatives, and ethanol plants to digitally connect with their growers for real-time information and payments, announced a $7 million private investment round.
The cloud-based platform, which is powered by a proprietary translator developed by Myriad Mobile, an enterprise software technology company, incorporates a wide variety of technologies that power real-time scale tickets, contracts, pre-pays, cash bids, e-sign, and more.
Two months later in June, Farmers Business Network (FBN) — the company behind the independent farmer-to-farmer network built to connect farmers and allow for the sharing of data, insights, and information critical to agronomic decision making — and AgriSecure, a Nebraska-based turnkey organic digital platform, announced their own strategic partnership.
And most recently, in August, IoT technology startup TeleSense raised $6.5 through a Series A led by ag investment pioneer Finistere Ventures for the advancement of supply chain, food safety, and grain storage solutions.
TeleSense plans to use the capital secured through this round to apply its data-driven solutions to the agricultural supply chain with an initial focus on grain transportation and storage.
“Agriculture has always been a technology industry,” said David MacLennan, chairman and CEO, Cargill. “Farmers and our customers expect us to deliver innovations that make them more efficient, effective and profitable. We embrace this as an opportunity to better serve the industry and ignite innovation through new products, processes and partnerships.”