The rise of the rural The Future of Farming entrepreneur 2014 - - PowerPoint PPT Presentation

Ambitious by nature

Berry Marttin, member Executive Board Rabobank

The rise of the rural entrepreneur The Future of Farming

2014 Nuffield Contemporary Scholars Conference

The challenge of the next GFC...

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The challenge

Natural resources

Food Natural resources

Food

2050

Every minute 158 more mouths to feed Of which 154 in developing and emerging economies 2014: Access to food is lacking 842 mln people are chronically hungry <-> 1.4 bln with overweight 3 mln children die of hunger every year 2050: Access & Availability More mouths with more money living in (mega-)cities “We need to produce more with less”

Consuming our western way…

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Arable land per capita (in hectares)

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Source: World Bank, Rabobank Arable land (hectares per person) Arable land (hectares per person) includes land defined by the FAO as land under temporary crops (double-cropped areas are counted once), temporary meadows for mowing or for pasture, land under market or kitchen gardens, and land temporarily fallow. Land abandoned as a result of shifting cultivation is excluded.

0.5 1 1.5 2 2.5 3 3.5 1971 2011 Minimum for West European diet

But the puzzle is complex...

(example supply side)

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Animal welfare Consumer perception Environment Biodiversity Economy Innovation

Global Master classes - key topics and deep dives on new themes

• Succession: Enabling

the next generation

• Sustainability:

From dedicated supply chains to circular systems

• Science: Unlocking big data, innovations
• Social enabling: From theory to practice
• Social Media: Virtual Farm concept P2P for leading farmers
• Supply

Chain: Balance the value chain

• Safety

& Health: Nutrition-sensitive growth

• Success: Best farm management

practices

• ........

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Succession challenge

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Size is important, but big is not always beautiful

9 Top performers are not the largest farms in Australia: 8 years average EBIT for Australian farmers (> 5mln assets):

Source: Rabobank dataset 2002-2010

1,5% 2,7% 16,4% 38,8% 26,2% 8,0% 1,4% 5,0% 0,0% 5,0% 10,0% 15,0% 20,0% 25,0% 30,0% 35,0% 40,0% 45,0% More than 10% Between +7.5% and +10% Between +5% and +7.5% Between +2.5% and +5% Between 0% and +2.5% Between 0% and

• 2.5%

Between

• 5% and
• 2.5%

Less than

• 5%

EBIT Australian farms > 5 million Assets 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

• A. more than 10%
• B. Between 7.5% and

10%

• C. Between +5% and

+7.5% AU 30mln + 20-30mln 15-20mln 10-15mln

Succession

• Key issue:

how to enable the next generation of farmers!

• Innovation and

investment is crucial

• Education is key
• Increase cash flow at

the farm gate

• Cooperation in the

chain is needed

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Best soils in US (Midwest), Ukraine & Argentina

Source: USDA 11

Tropical & humid Temperate & humid Temperate & humid

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Climate determines production potential as well

Soil quality & climate

13 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Social enabling environment Soil quality & Climate Actual yield Potential Yield

Actual Yield

14 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Social enabling environment Soil quality & Climate Actual yield Potential Yield

Social enabling factors key for yield

15 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Social enabling environment Soil quality & Climate Actual yield Potential Yield

Social enabling environment

• Key issue:

from subsistence to commercial farming

• Enable access to finance

No cash no crop

• Government Long-Term

Vision and Reforms

• Building a sufficient

agricultural infrastructure

• Cooperation within the

value chain is key

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Partnership FAO & Rabobank Foundation in Africa Rabo Development Financial inclusion for 7.5 mln people including 2mln farmers Rabo Foundation 25 countries Rabo Development 16 countries Rabobank Groep 47 countries 3215 client branches

Banking4Food

Sustainability

• Key issue:

reducing environmental footprint and waste

• Efficiency and High

Productivity are Key More crop per drop...

• Look for the opportunities

in sustainability

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Social Media & Innovation

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Innovation Productivity gains with Big data…

Crucial role for algorithms (machinery intelligence) to provide integrated farm solutions

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Algorithm Public data (soil maps, GPS, weather info, public research data) Proprietary data On-farm data collected by machinery (yield, applications, soil testing, etc.) Inputs Algorithm that runs machinery Yield

Supply Chain

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• Cooperate
• Maximise freedom
• Consolidate and

Concentrate

• Innovate
• Reconnect with consumers

Thank you

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Feeding our world more sustainably