Top Trends Ag Retailers Should Watch in 2023

In an industry that’s constantly evolving, you must keep a pulse on what’s coming to help your customers pivot and adapt. Whether educating farmers about new product classes or getting them set up to participate in emerging markets, you play a valuable role in future-proofing your customers’ businesses. Here are a few trends to watch as the 2023 season begins.   

Booming biologicals

Biological products, including biostimulants, plant growth regulators, microbial pesticides, and biofertilizers like algae, will continue to gain traction on the farm. As farmers explore new ways to enhance the performance of their current fertilizer and crop protection products, biologicals will find their way onto more acres. Grand View Research reports that the biologicals market will register a compound annual growth rate (CAGR) of 9.4% from 2020 to 2027. This product class also naturally fits with sustainable production practices that more farmers are adopting to improve soil health.

While biological sales are still relatively small compared to most inputs, there will be more opportunities to position these products with progressive farmers who want to push the boundaries on their yield and profitability potential. It may be a while before we see mainstream adoption, but with more grower awareness, biologicals could become a substantial revenue generator for ag retail.  

Bigger farms

If you’ve been in the industry a while, you’ve probably noticed that farms are getting larger. Data from the USDA’s Farms and Land in Farms 2022 Summary shows that the largest farms, with sales of $1 million or more, operate nearly 26% of U.S. farmland — six percentage points more than they did a decade ago. That trend will likely continue because farmers can realize more efficiencies and cost benefits as they combine resources and take advantage of volume discounts.

For ag retail, this trend holds challenges and opportunities. As the largest farms get larger, they will likely take on bigger, faster equipment capable of covering more acres in less time. That means you must prepare your business for shorter seasonal windows to meet customer demands and that you’ll need to have inventory systems and warehousing infrastructure in place to manage larger orders. Larger operations will likely also require more information faster than ever before. The next generation of farmers will likely be more comfortable communicating and doing business virtually, so having an infrastructure in place, like GROWERS Rally, will be crucial to meet the demands of larger farming operations.

More precision

Ag tech isn’t going away anytime soon. Farmers are abandoning blanket-style management in favor of a more prescriptive and granular approach. A recent precision ag summary by the USDA Economic Research Service reports that at least half of relatively large row crop farms (those at or above the third quintile of acreage) rely on yield maps, soil maps, VRT, and/or guidance systems to manage their operations. Farms are becoming more data-driven, and ag retailers must stay ahead of the latest technologies to keep up with their most progressive farmers. A technically savvy team that can sift through data to distill relevant insights will be more critical than ever as on-farm digitalization becomes more sophisticated and widely accepted. As the USDA reports, “we expect that digitalization has the potential to increase efficiency in the farm sector—while contributing to cost reductions, yield increases, and/or enhancement to the well-being of farm operators.” Those benefits will ultimately trickle down to the local ag retailer as well.

Better water management

Water has become a hot topic in agriculture, especially as historic droughts have ravaged the western U.S. Water has become the most limiting factor for crop production in areas like these. According to the World Bank, irrigated agriculture represents 20 percent of the total cultivated land and contributes 40 percent of the total food produced worldwide. But, unless the water is stewarded, agricultural production faces serious challenges.

Farmers limited by water availability will soon be able to push the limits on production in dryland areas. Several new ag tech startups are working on solutions to agriculture’s water dilemma. For example, N-Drip offers a gravity-fed drip irrigation method that conserves water and eliminates the need for costly pumping across even the largest fields. Lumo, another ag-tech startup, innovated a wireless, cloud-managed water valve network that will enable farmers to optimize water usage to improve crop quality and reduce overhead costs. UpTerra uses the fundamentals of physics to reduce water use by structuring irrigation water that is more hydrating to crops. These are just a few examples of how agriculture technology is delivering more possibilities to you and your farmers.

Emerging market opportunities

We’re entering an era of emerging market opportunities for you and your customers. You’ve heard about carbon sequestration and know many carbon programs are available. While farmer adoption of these programs is relatively low today, new legislation could help reduce entry barriers and provide more clarity and standardization across programs. The  Growing Climate Solutions Act was passed as part of omnibus legislation in late 2022 and will begin to provide a foundation for building emerging market opportunities for farmers.

In the future, farmers will also be able to diversify their operations and revenue streams through other ecosystem market opportunities, including water quality and water conservation credit programs. These emerging markets represent an opportunity for you to provide a value-added service to help farmers identify and implement sustainable production practices. By partnering with reputable ecosystem marketing program providers, you can offer farmers direct access to resources and information to capitalize on emerging market opportunities. These offerings help differentiate your business and showcase your sustainability leadership.

Stay at the forefront

Staying on top of the latest ag trends isn’t easy when you’ve already got plenty on your plate day-to-day. GROWERS can help lighten your load with tools and resources that simplify your workload. From a seamless customer communication experience to a digital sales management platform, we’re focused exclusively on boosting ag retail efficiency and profitability. Visit growers.ag to learn more.