MACHINERY companies were told to prepare for disruption based on the needs of the global consumer.
Speaking at the Tractor and Machinery Association (TMA) annual conference in Sydney, Rabobank, agriculture analyst, Wes Lefroy said the global food consumer is changing.
“Brands are starting to align themselves with credentials, that might be non-GMO, carbon neutral or things like fair trade, or animal welfare,” he said.
“The next part of this is the rise of smaller brands., as consumers satisfy the need and want to feel better about the food they are eating.
“The result of this is the range of food on offer is becoming larger, brands are trying to meet these individual tastes and needs.”
Mr Lefroy said consumers are starting to get food is also different.
“The effect of online shopping, is it essentially gives the consumer a wider range of choice,” he said.
”We are seeing the formation of tribes behind food.
“We are seeing a greater demand for food safety, transparency and provenance.
“Legislation is starting to grow from these tribe concerns, which isn’t surprising but the reduced reference to science is concerning.”
Mr Lefroy said an example of a proactive response to consumer change, was the butter industry, while consumers moved away from margarine for something considered more natural, there was also a rise in quality and offerings from the butter industry.
“Ensure we endure, like butter,” he said.
Mr Lefroy said blockchain technology could allow supply chain entities to facilitate the transfer of commodities and bring security and potentially transparency to the transaction.
”It provides a link between growers and consumers,” he said.
“Those at the farmer end will have a much better view of what is happening within the market.
“Being able to identify new opportunities and react to new niche demands, can essentially make decisions more accurately based on profit.”
Mr Lefroy said things like the “internet of things” (ioT), the interconnected network of things which collect and transfer data, will be important to link with blockchain technology.
“We are seeing machinery on the farm being the most developed data mechanism by farm,” he said.
“A lot of the advances we are seeing in data technology is coming form machinery.”
Mr Lefroy said to take advantage of future opportunities, farmers needed to recognise, while they may not see value in a product, the consumer may.
“Doing nothing is not an option,” he said.
“We need to accept the need for social licence to operate is real.
“Choose the quality path, certainly naturalness is a valid competitive advantage to pursue.
“Understand that supply chains will change, and more often and faster then before and that means your business will need to as well.
“Prepare for a data-heavy future, it presents both a disruption and an opportunity.”
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