Technology to boost productivity in Africa’s agribusiness – PwC

Agriculture is standing on the edge of a second green revolution which will entail fundamental shifts in how the agricultural sector utilises and implements innovative technology to improve output in a sustainable manner and address the need for greater food security globally, according to a latest PwC 2016 Africa Agribusiness Insight Survey.

The survey was carried out among group of African agribusinesses that are mainly focused on delivering agriculture and related services to primary producers.
“Currently, there is a second green revolution underway. There is a desperate need for food security and therefore, higher agricultural output without compromising resources in the process,” said Frans Weilbach, agribusiness industry leader, PwC Africa.

“Advances in technology and innovation are the key to the future of agriculture as agribusinesses strive to feed an increasing population against a background of climate change, scarcity of water and a host of environmental concerns,” he said.

He stated that innovative technology and advancements in productivity are becoming increasingly important as pressure mounts on food systems as the global population is growing rapidly and the climate is ever changing.
The agricultural sector is regarded as one of the most critical industries for the African continent due to economic potential and is projected to become a US$1trillion industry in sub-Saharan Africa (SSA) by 2030.

According to the survey, more than half; about 58.8 percent of survey respondents consider investment in Africa as an opportunity for their businesses to expand.
The survey focuses on the strategic challenges that agribusiness leaders face in their businesses, while on the other hand; it highlights areas where technological innovation is already taking place and where it can make a difference in the future.
“Agribusinesses are making changes to go high-tech. From data-gathering drones to artificial intelligence farming, technology is making the agricultural sector more precise and efficient as agribusinesses push for increased profits,” according to the survey.

“The average crop yield for sub-Saharan Africa is estimated at a mere 25 percent, compared to 90 percent for East Asia and that if sub-Saharan Africa can increase its yield to at least 50 percent, it will be able not only to feed itself, but to become a net food exporter in the process,” the survey states.
In addition, the survey provides viewpoints on the agricultural sector in Nigeria and Kenya.

Survey respondents, however, are less optimistic about revenue growth over the next 12 months compared with their expectations a year ago. The majority of agribusinesses (46.2%) are expecting revenue growth of between 0-5 percent, and 26.9 percent of businesses expect it to be between 6-10 percent.

The biggest challenges to business growth cited by business leaders were access to technology, the scarcity of natural resources and supply-side uncertainties. African agribusinesses also feel that there is a long way to go toward better support from government in the sector.

Josephine Okojie