Sage, SAP say data is the fertilizer that will feed Africa’s agricultural transformation

Sage, SAP stated that data is the fertilizer that will feed Africa’s agricultural transformation noting technologies like blockchain, Internet of Things and Artificial Intelligence key touted as the enabler of a new era of African agricultural prosperity.

Stated at the recently concluded Smart Agri Congress Africa, themed “Disruptive technology changing the face of Agriculture” saw the two organisations shared information on how Africa as a continent approach the adoption of these technologies across the agricultural value chain through digital transformation – especially in an industry that the World Bank estimates employs two-thirds of the continent’s workforce and produce a third of its total GDP?

“With rising demand for food for the world’s growing population, East Africa is strongly positioned to turn agriculture into a major driver of economic growth. Farmers and food processing businesses need to invest in technology to make their organisations globally competitive to seize this opportunity,” said Nikki Summers, Regional Director for Sage in East Africa.

“Sage has business management solutions that will integrate the data and the collecting of the data using IoT devices that the East African food and agricultural businesses can elevate their productivity and profitability by targeting the needs of their niche in the agriculture market.”

In 2009, SAP embarked on the development of a solution that would enable better management of smallholder farms by tracking and collecting data related to farms, cultivated plots (via GPS coordinates), crops, farmers, and farm gate selling processes.

A prototype of this solution was developed in cooperation with the GIZ, a partner of the German Federal Ministry for Economic Cooperation and Development (BMZ), and piloted in 9 African countries reaching more than 100 000 small-scale producers. Quality data is the single most important building block toward establishing a smart agricultural sector for Africa.

“The capability to give smart farm input is now made a reality. We now talk about the age of digitization, we talk about the customer of one not the customer of many based on digital input. I can be able to customize a product in real time and tomorrow could be a different product just with the data I have about you as a farmer. I can then tailor smart pesticides, smart fertilizers, smart information to that particular farmer that are very cost effective just because you have all that information which makes sure that every particular farmer wherever they are can have maximum yield at any point in time. That is what technology allows us to do,” stated Dr. Gilbert Saggia, Managing Director: East Africa at SAP Africa.

Data feeds digital transformation in agriculture

The African agricultural sector is dominated by smallholder farmers. According to the International Fund for Agricultural Development, there are an estimated 500 million smallholder farmers in Africa and South-East Asia, providing as much as 80% of the food consumed in these regions and supporting up to two billion people financially.

Many of the difficulties these smallholder farmers experience are directly or indirectly related to the availability of quality information and data mainly because of infrastructure. Such data includes information about buyers and exporters; information about inputs, such as soil types, growing best-practice, weather, and pest control; information about markets, such as pricing and local, regional or global demand; traceability information related to food safety and certification to increase the market value of goods produced; information regarding storage and logistics; and access to financial services in the form of micro-loans or insurance.
“In agri-businesses, it is common for growers and producers to get paid based on the grade or quality of their products,” says Braam Koekemoer, Regional Manager: Africa at Aritmos, an independent software vendor developing specialist agriculture functionality for the Sage Enterprise Management system. “These growers usually don’t provide companies with purchase invoices. With the right software, it is simple for buyers to generate invoices on behalf of producers, and to manage advance payments and final settlement after delivery.”

In many instances, the lack of information has a direct impact on African smallholder farmers’ outputs and, by effect, livelihoods. Only 5% of cultivated land in Africa, for example, makes use of irrigation, compared to 38% in Asia, leading to lower yields and limiting their income-earning ability. And while agricultural performance has improved over the past decade, it is not yet sufficient to meet the demands of a population that is expected to grow by 1.3 billion people in Africa alone by 2050. A technological intervention is needed.

Reimagining Africa’s agricultural sector

According to a 2017 report by the Alliance for a Green Revolution in Africa (AGRA), the continent’s food system requires an agricultural transformation that is focused on more than just agricultural production and encompasses the entire food system. The report further points to promoting the growth of smallholder farms and SMEs involved in Africa’s food systems, and providing assistance to smallholder farmers that commercialises viable farm business prospects and capabilities.

One view to a smart agricultural sector involves establishing a sustainable and inclusive agricultural model that promotes equitable value distribution across the value chain; creates jobs; allows the increase of productivity and improvement of logistics and storage capacities while remaining cost-effective and respectful of the environment; and implementing and monitoring effective and efficient public policies.

We believe that the bedrock of such a model is the capturing in real time of all relevant data produced by each of the different stakeholders within the agricultural value chain, so that their decisions are as rational and efficient as possible. Here, technology has a clear role to play.

“Digital Transformation allows you to live on data and how to make decisions based on data in agriculture. We need the data because it informs you when are you planting, weeding, pruning, harvesting and digital transformation gives you the opportunity to integrate a lot of components in this ecosystem where you have the farmer themselves, the equipment, the materials, the land they work on. Integrating all this and using devices and sensors to collect this data and make a decision, data which is collected from various areas i.e. the soil, animals, air to name a few,” said Michael Rasugu, Enterprise Sales Leader at Sage East Africa.

Reimagining Africa’s agricultural sector

According to a 2017 report by the Alliance for a Green Revolution in Africa (AGRA), the continent’s food system requires an agricultural transformation that is focused on more than just agricultural production and encompasses the entire food system. The report further points to promoting the growth of smallholder farms and SMEs involved in Africa’s food systems, and providing assistance to smallholder farmers that commercializes viable farm business prospects and capabilities.

A technology platform designed for smallholder farmers

Called SAP Rural Sourcing Management, the solution is operated in the SAP Cloud Platform and delivered as Software-as-a-Service to farmers who access it via their mobile phones, negating the need for costly technology infrastructure investment. Rural Sourcing Management is used by the world’s largest chocolate producer, Barry Callebaut, and the Kalangala Palm Oil Grower’s Trust in Uganda, where 80% of the population is involved in agriculture.

The Rural Sourcing Management solution is helping the KOPGT grow and expand, improve efficiency, and keep all major players in the value chain connected digitally. This is shining a path toward prosperity in Uganda and supporting the government in its aspirations of moving its citizens to a middle-income status by 2040. We believe that by providing African smallholder farmers with technology tools designed to improve their day-to-day farming operations, we are creating an ecosystem of benefits across the agricultural value chain that will take the continent one step closer toward realising a brighter and more food-secure future for generations to come.

Adds Koekemoer: “With rising competition and growing global opportunity, this is a challenging and exciting environment for African agri-businesses. With the right technology in place, they can improve productivity, efficiency and quality to compete with the best in the world. They can also prepare themselves to integrate the next wave of digital technologies reshaping the world of agriculture—from drones and the Internet of Things to precision farming.”