71. The Marshmallow Test

Herbicide resistance

Hi. If you are new here, I am Rhishi Pethe, and I am excited you’re in the “Software is Feeding the World'' community. Every Sunday, you will receive this free newsletter at the intersection of technology and agriculture systems. I am a product manager at Project Mineral (focused on sustainable agriculture) at X, the moonshot factory. The views expressed in this newsletter are my personal opinions.

Today’s edition includes,

  • Will herbicide resistance lead to change in farming practices?

  • Semios and AgWorld - speciality meets row crops.

  • Fulfillment by PDD?

  • Golden Rice approved for commercialization in the Philippines.

  • Blade Runner (great product name!) in India.

  • Crop risk assessment in developing countries - Spire Global and Mantle Labs.

  • Around the coffee shop.

  • Listen and watch recommendations - Jack Bobo, The Last Drop.

The marshmallow test

What do you do when you have something relatively inexpensive, and works really well to solve a problem? You go for it.

Antibiotics are one of the greatest inventions/discoveries of the modern era. The common antibiotics are relatively inexpensive, and in most cases they work. But poor antibiotic stewardship can result in antibiotic resistance, and lead to a vicious cycle of higher dosage and potency. My country of origin (India) is a prime example. A study found that 70% of individuals in India have antibiotic resistant bacteria.

Farming has been seeing this phenomenon get worse over the last few decades, when it comes to herbicides and certain weeds like Palmer Amaranth. 

If glyphosate is considered a once in a century molecule, Palmer Amaranth is a once in a century (or worse) weed. 

Glyphosate was extremely effective, and relatively inexpensive for countering a wide variety of weeds. When glyphosate resistant GMO crops came to the market, the use of glyphosate skyrocketed.

Two decades later, Roundup’s complement, an innovation that caused sales to surge even higher, arrived: Roundup Ready seeds. The genetically modified plants that sprouted from them could survive spray after spray of the herbicide. This enabled farmers to simply plant Roundup Ready seeds, wait until the weeds emerged, then spray the entire field with Roundup. Everything but the valuable crop quickly wilted and died. The development revolutionized weed control: Farmers no longer needed to buy a vast array of expensive herbicides each year or till their land every season.

The word “Amaranth” derives from a Greek word, which means “unfading.” John Milton described “Amaranth” as immortal in Paradise Lost. The Greek origin and John Milton were prescient in some sense, at least within the context of agriculture. If it is unchecked, Palmer Amaranth can suppress soybean yields by nearly 80% and corn yields by 90%! 

Connie Bowen, in her podcast with Sarah Mock, “The End of Agriculture: Glyphosate” made the point that glyphosate was so good, the farming industry overused it. Similar to the antibiotic example, it was too much of a good thing. Weeds like Palmer Amaranth have become resistant to herbicides. In fact, pigweed is tailored to evolve resistance to most common weed killers. It continues to reproduce, even in the worst of circumstances. A cockroach is supposed to be able to survive a nuclear explosion.

Palmer Amaranth is the “cockroach” of agriculture.
Palmer Amaranth is the hydra of agriculture, with no Heracles in sight.

Tragically, no better weed killer has been invented since. Farmers are being forced to use older products, with different modes of action. In theory, a new mode of action would go a long way to stop weeds like Palmer Amaranth from gaining ground. The problem is that nothing approaching Roundup’s efficiency and cost-effectiveness has been introduced.

Weed scientists have been warning farmers to adopt integrated weed management by combining herbicides with practices like rotating crops, hand pulling weeds (not practical in row crop farming), and scouting. Crop rotation has become more common, but not at the rate at which it would have slowed down the advance of herbicide resistance. Some of the other practices are expensive, and require a new way of doing things.

Will herbicide resistance force more farmers to adopt different farming practices?

When given a marshmallow, with no bad outcomes on the horizon, it is very difficult to say no to a marshmallow, and instead eat your share of vegetables, exercise, and sleep well.

Are there other marshmallow scenarios lurking in the future? 

Are there generally acceptable practices, but would result in some difficult scenarios in the future? I would love to hear some ideas from you.

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Semios and AgWorld

Vancouver based Semios has been on an acquisition spree. It had previously acquired Altrac and Centricity to build out its offering for automation, control and compliance. Semios recently acquired AgWorld. Semios and AgWorld business, their customers, and the solutions they offer are very different.

Semios works with low acreage, high value permanent crops like apples, grapes, cherries, pistachios and almonds in California, Oregon and Washington, and provides sensors for pest management and reduction of pesticide. AgWorld works with high acreage, annual commodity row crops, and provides tools for enterprise resource planning, task and activity management, and reporting.

Based on this acquisition,

Vancouver’s SemiosBio Technologies Inc. is set to become the world’s largest independent agriculture technology company after agreeing to buy Australia’s Agworld Pty Ltd. for more than $100-million.

Semios offers a bug-control technology which fools bugs. Semios’s product is a chemical which mimic pheromones, are sprayed at regular intervals from canisters in orchards and vineyards, and trap the male insects, who think they are looking for a female. It is a subscription based model for growers.

The 2 x 2 matrix below is not the best representation to show how their businesses are different, but it does show the difference between the crop, and capability focus, including a difference in go-to-market for the two companies (grower vs. retail.)

Semios is supposed to be profitable on an individual farmer basis, which is not always true if you are on the right hand side of the chart above.

What are some potential synergies that the two companies together can try to exploit?

  1. Market access: AgWorld and Semios’s customers are mutually exclusive from a geographical standpoint, and so there is a potential to cross sell in each other’s markets immediately.

  2. Semios can leverage AgWorld’s retail go-to-market to reach additional customers, which fit their current offerings. Given AgWorld’s retail expertise and Semios farmer expertise, the two can provide a better customer experience and service to farmers due to stronger connections with the grower value chain.

  3. Semios could leverage the planning, tracking, and reporting solutions from AgWorld, if they can tweak them to work for different geographies and crop types.

  4. AgWorld can leverage Semios expertise on drawing insights, and potential actions, and apply it to broad-acre crops and customers.

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Fulfillment by Pinduoduo?

Pinduoduo continues its relentless growth in China. PDD announced their Q2 2021 results, their numbers continue to be impressive.

  • Total revenues increased by 89% compared to the same quarter in 2020!!!

  • Average monthly active users in the quarter increased by 30% from 568 million to 738 million, compared to Q2 2020.

  • Active buyers in the 12 month period ending June 30, 2021 increased by 24% to 850 million from 683 million, compared to the previous 12 month period!!!

  • PDD reported a profit compared to a loss in the same quarter in 2020.

Revenue growth has outpaced user growth 3-to-1. It indicates a higher basket size per user, or inclusion of other direct non-user revenue sources.

Pinduoduo is working to improve downstream market access for farmers, help them build brands, provide training and tech to improve productivity, and is revamping logistics infrastructure.

Depending on how good the infrastructure is, they could potentially start providing infrastructure as a service (similar to Fulfillment by Amazon) to other businesses. If the density of people and products using their logistics network increases, it will further drive down costs for their business. This could be a virtuous cycle, with the logistics network becoming a strategic asset in their business model.

(If you want to learn more about Pinduoduo, you can read my conversation with Xin Yi Lim, executive director of sustainability and agriculture for Pinduoduo from a few months back.)

Golden Rice

Malnutrition is a big challenge in developing countries in Asia and Africa. Vitamin A deficiency impacts an estimated 190 million children globally, about two and half times the number of total children in the US! Vitamin A deficiency is a leading cause of childhood blindness. The numbers in a country like the Philippines are mind boggling and sad.

Every day, 95 children in the Philippines die from malnutrition. Twenty-seven out of 1,000 Filipino children do not get past their fifth birthday. A third of Filipino children are stunted, or short for their age. Stunting after 2 years of age can be permanent, irreversible and even fatal. (Data from UNICEF)

Image source

Golden Rice was developed in collaboration with the International Rice Research Institute (IRRI) to contain added levels of beta-carotene that the body converts into vitamin A. The rice is genetically modified to give up to 50% of the young child’s estimated average need for vitamin A.

​​The Philippines became the first country to introduce Golden Rice. I hope it leads to better health outcomes for millions of children in the Philippines and other countries.

Blade Runner

FMC Ventures, Omnivore, and Blume Ventures invested $ 5 million in Tartan Sense, an Indian agriculture robotics startup.

TartanSense builds robotic farm vehicles, generally smaller in size than their non-automated equivalents, that are equipped with computer vision technology that allows them to ‘see’ what they are doing.

These robots are built to target two interrelated problems faced by many smallholder farmers in India and other lower-income economies: inefficient chemical spraying, and an unreliable supply of manual labor.

Its latest robot — named BladeRunner — is able to locate, identify, and uproot weeds, in addition to spot-spraying particular crops. According to TartanSense, BladeRunner can reduce chemical use by up to 45% and boost weeding efficiency 7x.

I love the focus on the problem. They want to go after cotton, which is a big cash crop in India. It is an efficiency play for use of inputs, and access to skilled labor, which is a challenge anywhere in the world. The go-to-market strategy of Tartan Sense is not very clear to me, and I would love to know more. I am left asking the question that Venky Ramachandran posed in his last newsletter,

What will take Indian Agtech to move beyond its obsession with the B2B2C model and move towards direct-to-farmer network business models pioneered by the likes of FBN?

Spire in developing countries

Remote sensing in developing countries has two main challenges - small size of fields, and limited ground truth data both in terms of quantity and quality.

A partnership between Spire Global and Mantle labs will try to address the problem of risk assessment solutions. Spire’s satellites will collect radio occultation data*, including advanced weather data and models in Southeast Asia, India, South America, and Africa. 

(*Radio occultation (RO) is a remote sensing technique used for measuring the physical properties of a planetary atmosphere or ring system. Radio occultation captures precise atmospheric data that helps reduce errors in weather forecasting)

Spire’s constellation has about 110 low-orbit nano-satellites (CubeSats) that collect real-time data from every layer of the atmosphere. Spire also provides forecast APIs, configurable weather precision models, to understand risk profiles for farming operations.

The weather infrastructure in these regions is not as advanced as North America or Western Europe. The partnership will provide farmers with advanced warnings on crop health, weather, and threats from pests and disease.

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Around the coffee shop

Invasive species introduced by human activity are costing African agriculture $ 65 billion every year or around 2.5% of Africa’s GDP.

Food inspection is a critical part of food safety. Zoom Agri raised a $ 3.3 million seed round for a VaaS (Vision-as-a-Service) food inspection technology. Zoom Agri focuses on grains and oilseeds, and provides it as a service model, while the hardware is free. Combining computer vision, machine learning, and IoT, ZoomAgri aims to disrupt the current methods for performing testing, inspection, and certification functions, which involve a lot of manual labor. 

Syngenta Group announced its second quarter results with a 24% increase in sales for the group, with China showing a 46% growth rate Y-o-Y.

Corteva and Growmark have partnered with Indigo to provide a third party verified credit program for carbon. Given the recent Wall Street Journal article on Indigo, it is a bit surprising that marquee names like Corteva and Growmark are partnering with Indigo. It suggests there is more than what meets the eye. A Twitter discussion based on a Tweet from my friend Shane Thomas is interesting. Jake Joranstad estimates Indigo’s gross revenue for 2020 to be around $ 8 million, compared to the billion dollar revenue number stated in the article. 🤯

Listen and Watch

Pre-pandemic, I used to listen to podcasts on my commute to work. With the pandemic, my podcast listening has gone to zero. With voluntary return to work, I have started going into the office once or twice every week.

I heard Tim Hammerich’s Future of Agriculture podcast after a long time last week. I had almost forgotten how good Tim is at interviewing guests. I am especially excited about the series with Amy Wu to highlight women leaders in the food and agriculture space. I am also excited that Tim is going to spend more time across the entire food value chain.

I recently listened to his conversation with Jack Bobo, which was fascinating.

Jack Bobo (39:45)

“We will need to produce as many calories in the next 30-40 years, as we have the last 10,000 years”

Jack Bobo is the CEO of Futurity (Where Food meets the Future) and it was fitting to listen to him on the “Future of Agriculture” podcast. You should listen to the whole thing, but here are some interesting tidbits I picked up from the conversation. Human psychology and how you nudge human beings has a big impact on outcomes.

  • 42% of all Americans are obese and by 2030, that number will be 50%.

  • In 1975, obesity rates in Europe were higher than America. (This stat blew my mind.)

  • David Wallerstein, while working for a chain of movie theaters, introduced the concept of jumbo popcorn and jumbo drinks. It was based on the thesis that people will feel odd to go back for seconds. He managed to convince McDonald’s to do the same.

  • In 1955, a soda at McDonald's was seven oz. A child size today is 12 oz.

  • Halo effects are powerful - a cookie labeled as low-fat is considered healthy, even though it might be loaded with sugar. Many brands today leverage the halo effect with words like “organic”, “natural”, “whole grain”, “regenerative” etc.

  • Confirmation bias is a huge factor in our decision making (no surprises there.)

  • Jack Bobo found that even though the plate portion at Cheesecake factory seems to not fill a plate completely, due to the ginormous plate size, you actually get two meal sizes per plate!

  • Livestock based protein producers should not be fearful of plant-based proteins as the protein market is a growing pie due to increased demand from developing countries.

  • Soda taxes can be a problem, if you compare them to tobacco taxes. Soda consumption is at a 30 year low, but obesity is at a 30 year high.

  • Sustainability is a continuum from local to global sustainability.. For example, Europe exports its environmental footprint, as it is the largest importer of food, and Brazil is the largest exporter to Europe. Consumers think in terms of local sustainability, but agribusinesses should think in terms of global sustainability.

The Last Drop - India’s Water Crisis (46:53)

California is facing a drought and my country of origin is facing a massive water crisis as well. The Last Drop is a documentary on India’s Water Crisis.

The problems of food production, and water scarcity are oftentimes political, and policy challenges, rather than not-enough-food being grown or not having enough rainfall. I was not excited about some of the people they chose to interview, because I believe they don’t have good intentions.

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