Smart Farms in ASEAN: Risks and rewards for some of the most vulnerable

Bali Rice Fields By Trevor Clarke, Tech Research Asia research director

When we talk about the "future of work", very rarely do we hear anything about agriculture, in what remains a large employing industry in ASEAN - one of the most populous regions in the world.

In the Asia Pacific IT industry, the agricultural sector has never really been considered a sexy market. In most countries, it represents but a fraction of the end user spending and is a difficult market to develop and stimulate demand.

Connectivity in regional areas, while improving, has been poor, especially in emerging countries in the Asia Pacific region but also in advanced economies like Australia and Japan. Farming customers have widely varying levels of understanding and adoption of technology, and they are dispersed across broad geographic areas. Meaning cloud-based services which feature heavily in today’s offerings, and even the client-server applications of yesterday’s era, are often difficult to implement with any certainty of performance levels. It can be done, but doing so just has not attracted the same attention as financial services, government, and other big-spending sectors that are concentrated in easy-to-service urban centres and mega-cities.

This is not to say that those in the agricultural community have all been luddites. There are many examples of progressive technology adoption in various locations in the region. For example, when I was an editor I remember commissioning a story over five years ago about the Australian wine industry which included an array of impressive case studies ranging from SCADA systems and analytics, to autonomous forklifts in factories (you can read it here). There are also many examples of mobile phone adoption empowering many small-scale farmers in the region with market information and education. There are pockets of advanced tech adoption, but for the most part they are the exception and not the rule - especially in ASEAN.

In contrast, today through contemporary Internet of Things (IoT) technologies and improved connectivity a renaissance in thinking about what it means to be a smart farmer is occurring in many developed countries such as the US, Canada, Japan, and Australia. And the industry should now be considered one of the sexiest opportunities.

Indeed, there are many ways that the IoT is playing a role in this reborn interest in agriculture as a real tech opportunity. Consider the following - very few - examples:

  • Sense-T in the island state of Tasmania in the south of Australia has a range of IoT-driven projects in both agriculture and aquaculture. This includes, among many other exciting projects, disease prevention in vineyards via sensor monitoring, weather information, and analysis of historical disease patterns.

  • The use of drones or unmanned aerial vehicles (UAVs) for imagery or spraying such as that shown in this video from Japan:

  • And then there are the connected cows, as explained in this video:

  • Precision agriculture tech and services - like that from John Deere in the US - that includes remote management of equipment, precise delivery of chemicals via "hands free" computer control of vehicles and equipment, and data-driven insights.

  • The use of satellite imagery combined with other sensor based networks to improve the productivity of pastures such as the Pastures from Space project.

There are, many, many more examples that stretch across the broad sub-sectors within agriculture - and most are from developed economies. But what is a smart farm? Is it just the adoption of these IoT-type technologies? I would argue it must have, inter alia, the following characteristics:

  • Adaptability: An inherent ability to adapt to market circumstances and the environmental conditions of the day.

  • Long-term Profitability: Both financial and in terms of what the farm contributes to its community

  • Sustainability: Across all facets of this concept including the environment, people, and business

  • Security: Both in terms of the safety and wellbeing of people working on the farm, the safety of the food or produce for those consuming it, and food security for the community and country.

  • Empowerment: For the farmer and the community through data ownership and agency to act on knowledge derived.

  • Agile technology enablement: Fast adoption of easy to use technology that can be supported and upgraded easily over time within the economic reality.

So if these are at least some of the characteristics of a smart farm, do national agriculture policies support this vision in a region like ASEAN? Are they integrated with other policies (such as information technology and communications, logistics, environment, etc) and regulations (especially as regards trade and data)? In my opinion, there is a lack of existing coordinated frameworks for ensuring optimal outcomes when it comes to smart farming policies across the globe. And if such approaches have been developed, they are certainly not easily accessible to those with resources to search for it (i.e. someone like myself), let alone farmers in developing markets that could be affected by it.

In my view, we need to consider "smart farms" and what they mean for the future of work in ASEAN's (and other's) agriculture industries very carefully. The potential outcomes of both a positive and negative nature are too significant to ignore.

In the ASEAN region in particular, the role of smart farms is still not well researched and understood. While there are forecasts for how big the IoT market will be in Asia Pacific (more than US$500 billion by 2020 according to some) in my experience these forecasts often mask the reality for sectors like agriculture and even if included are not reliable as a result of heavily modelled approaches that are not open to peer-review. They also don’t offer much to inform farmers own strategies, that of national policies, nor the go-to-market activities of suppliers. In reality they more often than not just add unhelpful noise to what is already a very loud and sometimes shill chorus around IoT.

We lack a strong empirical and even qualitative understanding of the level of the adoption of smart farm services and technologies in ASEAN. Furthermore, the implications of this adoption in the region compared to the same use of technology in competing trade locations is also not well understood. This is especially the case outside of niche academic work, intergovernmental agency circles, development NGOs, and localised farming groups.

In the discourse around the future of work and emerging technologies (especially the “rise of the machines”) there has been some work (and a lot of publicity) done globally on the susceptibility – and it is important we stress “susceptibility” in this conversation – of various roles or tasks to be replaced by artificial intelligence, machines, or robotics. See these examples from this edition of TQ here, from the BBC here, and from the original Frey and Osborne work which kicked it all off here. I believe the rise of automation and IoT is an important development that may critically impact agriculture in ASEAN (as well as the broader Asia Pacific region).

In the Frey and Osborne US-focussed work, farmers had a 47% probability of computerisation which is the 137th least likely out of 702 jobs they looked at. In the BBC's UK-focussed adaptation of this work, "farmers" are "fairly likely" to be automated being 108th out of 366 jobs evaluated.

McKinsey and Company, however, contend that the focus on occupations is misleading, and that we are better off looking at what tasks can be automated. The company's research suggests, "fewer than 5 percent of occupations can be entirely automated using current technology. However, about 60 percent of occupations could have 30 percent or more of their constituent activities automated." I lean towards this approach over focussing on occupations, except, of course, for roles that only have few tasks involved such as those on assembly lines in factories. Also, what isn't clear from McKinsey's work is what the implications of their analysis is for farming and agriculture. They may have looked at this, they may not have. Either way they haven't published it yet.

And in all cases, the implications for a region like ASEAN are far from being known or analysed with empirical evidence to support the findings. This is all happening outside of the region and with different economies and technology adoption levels as the framework of analysis.

Indeed, to my knowledge there is yet to be an informed debate about what could happen to what is arguably already some of the most vulnerable people: ASEAN’s farming families and communities (and of course other places across the region and globe). If it has happened, it's not well-known. Although a swing towards services is clearly evident in most of ASEAN’s labor markets, agriculture, husbandry and fishing still make up swathes of employment. See the two maps from the World Bank below. The first shows the percentage of the population employeed in agriculture as a percentage of total employement, and the second the percentage of the population in regional areas.

Use the scroll wheel on your mouse to zoom in and click and hold to reposition the maps over ASEAN

Data from World Bank
Data from World Bank

According to the Asia Development Bank, in Vietnam there are more than 24 million people employed in agriculture, or some 46% of total employment. In Myanmar it is over 70% or 20m+ . In Indonesia it is 35% or close to 40m people. In Cambodia it is 64% or close to 5m people. In the Philippines it is 31% or around 12m. In Thailand it is 41% or approxiamately 16m. In Lao it is around 70% or 2m. Only Malaysia and Singapore are much lower percentages. Combined across the region we are talking more than 100 million people directly employeed in agriculture, give or take. This doesn't include the informal workers such as family members that also help out, nor the communities in rural areas that rely on this employment.

A hefty portion of this segment of the population is often characterised by ILO, the UNDP, the Asian Development Bank, and the World Bank as some of the most vulnerable.

As a very simple exercise to highlight the point – which we do not suggest is sufficient in any way as research or evidence - if we directly apply Osbourne and Frey’s approach to the region we 'd see close to 47 million people are at risk. If we used the BBC’s approach it is closer to 70 million plus. Due to the very different characterstics of farming within ASEAN and also the level of existing technology adoption and their access to new tech it is likely the probability of being susceptible to automation is much lower. But even if we are talking about 5% of the farmers in the region, that is 5 million people who typically are already in lower socio-economic categories and with wider effects due to food security, community health and well-being, families, education, and national success at stake. Clearly, far more work is needed to establish an empirical body of work on the risks to ASEAN farmers from automation and the rise of IoT.

There is definitely a case that all sub-sectors of agriculture can potentially benefit from the adoption of IoT-related technologies and services across the world including ASEAN. I encourage a robust approach to policy in this area and hope all farming communities can benefit.

However, in my view, there is also a real possibility of these ASEAN communities suffering immensely and perhaps more acutely than those in advanced economies that are also disrupted. One reason would potentially be because of increased competition by large-scale IoT-driven and automated farming in developed economies that further widens the already huge digital-divide between most of ASEAN and places like Australia, the US, and Japan. Another reason could be the actual loss of jobs for farm owners or workers in ASEAN as a direct result of automation.

Anni Nitin, who is Executive Director of the Southeast Asian Council for Food Security & Fair Trade (SEACON), agrees the digital divide is widening and the risks are real.

“Smart farms are not so near I would say, but of course it is in the pipeline. Even in the next 15 years, I mean, our stakeholders are those in rural areas. It really depends on the support of governments as well to provide the infrastructure. Even if we talk about eAgriculture, in most of this areas in rural parts this infrastructure barely exists. In some communities, such as in Hanoi which is about 3 hours drive from the city we can hardly get internet connections. The basic infrastructure must be provided first.”

SEACON's work is in food safety and training those in agricultural communities how to leverage technology, in particular the basics of accessing information on the internet to make decisions. But she says a "smart farm" as we know it in developed nations like the examples above is not going to be mainstream in 10 years in places like Laos or Cambodia.

“Personally, for me it is a risk. Because with every technology you put in place you have to think about the consequences on the job market and people. How do you balance it? Even with the job creation that you have related with high technology, it already screens out a lot of people that can’t do that job.

“When we talk about sustainability of technology itself, and most of this automation, today hardly we see much of it come from ASEAN itself. So most of it is imported from outside, so maintenance and long-term knowledge transfer is an element that needs to be addressed.”

Nitin’s work at present is predominantly about teaching farmers the basics about technology and the internet. The adoption of advanced IoT services for them is still somewhat of a pipedream. Yes, the power of information is great for farmers. They can reduce their risk when they can directly get into the market and understand it. However, the information revolution, let alone Industry 4.0, is largely passing them by.

Consider also that most of the farmers already struggle to stay above the poverty line and find enough capital to invest in their farms, let alone technology like connected machines and analytical tools. They are often owners of small-plot holdings and cannot compete at scale with multi-national conglomerates.

They are also in regional areas that do not have a ready supply of re-training facilities available or different job opportunities should these farmers decide – or have it decided for them – that their profession is going to be replaced by machines directly or driven out of business by large-scale farming competition from other locations. By more well-funded farms that have access to capital, information, and technologies that allow them to be more predictive, more efficient, and less reliant on human labour - as we are already witnessing.

It is very likely that the impacts of smart farms will be felt differently in different locations and depending on the sub-segment of the industry across ASEAN as it will the world. Some will prosper as a result of IoT – and at large it has the potential to help improve the quality and quantity of food available on average around the world – and that is to be welcomed and encouraged. I should stress, that I am a big believe in the potential positive outcomes of the agricultural internet of things (IoT). There are some wonderful opportunities to do things we already do better, or to generate great new outcomes with technology. Indeed, it is very possible – as most of those looking into the susceptibility of jobs or tasks to be replaced by AI or machines suggest – we will see the emergence of new job opportunities and different services in the agricultural sector as a result of technology adoption. Other benefits are also possible and must be pursued.

I don’t believe we are yet at a point that this is to be considered an imminent danger to these ASEAN farming communities as IoT and AI-driven automation via machines is still in embryonic stages of adoption. But I also don’t think it a stretch to suggest the future of work for many ASEAN farmers also includes many grave risks that are not being discussed enough in our push for benefiting from the emergence of sexy smart farms laden with connected tech.

Will they be able to adapt quickly enough and can we prevent foreseeable suffering? In the rush of start-ups, venture capitalists, and even established ICT vendors to “disrupt” industries and flip companies for profit, what are the longer-term implications for the livelihoods of vulnerable people, families, and communities? And what will happen to the many important cultural ties to agriculture that are evident across the region? These are big questions with not many people offering answers at the moment. But they’ll need to be addressed with multi-stakeholder input if we are to mitigate the downsides and amplify the many potential and potent positives of smart farms in ASEAN. After the future of work for more than 100 million people and their families is at stake.

At TRA we are investigating the lessons learnt by early adopters of smart farm approaches. We want to help all stakeholders gain a clearer understanding of the outcomes that occur when these projects are pursued. This includes the skills needed, the financial requirements, the business and flow on effects. We encourage anyone with experience in this area to get in touch. The results will be available freely to any interested party and published here on TQ.