Agricultural Supply Chain Service Market

Agricultural Supply Chain Service Market Size

The global Agricultural Supply Chain Service Market size was valued at USD 865.6 million in 2022 and is projected to reach USD 1,822.4 million by 2030, growing at a CAGR of 10.02% from 2023 to 2030. Advanced technologies are playing a critical role in the agriculture supply chain service industry, driving trends like precision agriculture, smart logistics, blockchain and digital marketplaces, and data analytics. Precision agriculture refers to the use of remote sensing, GPS, and other technologies to monitor crops, soil, and weather to optimize efficiency and yields. The aforementioned factors are augmenting the agricultural supply chain service market growth.

Blockchain technology is being used increasingly to ensure supply chain transparency and traceability, facilitating secure, decentralized transactions. Digital marketplaces and data analytics technologies are helping organizations to optimize pricing, reduce waste, and increase profits by providing data-driven insights into supply and demand trends. Overall, advanced technologies are providing farmers, producers, and retailers in the agriculture supply chain with the tools to make data-driven decisions and optimize their operations for success in an increasingly competitive market.

Analyst’s Review

Agriculture supply chain service is an increasingly important component of the agriculture industry in North America, with advances in digital and analytics technologies offering ways to optimize efficiency and resilience under water supply scarcity. Moreover, smart logistics involves the use of connected technologies to keep track of inventory, monitor shipping and delivery, and ensure the timely and efficient movement of agricultural products.

Market Definition

Agricultural supply chain service refers to the range of goods and services necessary for an agricultural product to move from the producer to the final consumer. This includes activities such as production, processing, packaging, transportation, marketing, and distribution. Agricultural supply chain services aim to create value for all actors in the chain, from small farmers to consumers. Donors, governments, and other organizations often provide support and funding to improve and strengthen agricultural supply chains, especially in developing countries.

This includes initiatives to link farmers to markets, promote sustainability, and incorporate inclusive value chains which benefit small-scale farmers. Information and communication technologies are increasingly being used to improve the efficiency of agricultural supply chains. Creating the right enabling environment and investing in rural public goods are deemed essential for successful value chain development.

Agricultural supply chain services have a wide range of applications in the agricultural industry. These applications include production, processing, packaging, transportation, marketing, and distribution. In recent years, there has been an increasing focus on using technology such as blockchain to improve the efficiency and transparency of supply chains also includes tracing food products from farm to fork, ensuring their safety and origin. The right enabling environment and investment in rural public goods are considered essential for successful value chain development. Agricultural supply chain services play a crucial role in ensuring a safe, efficient, and sustainable food supply for consumers worldwide.

Market Dynamics

There has been an increase in the use of cloud-based software for various agricultural supply and demand chain applications in recent years. This trend is expected to continue, as cloud-based solutions offer benefits such as flexibility, scalability, and easy accessibility from various locations. In the agriculture industry, the adoption of cloud-based supply chain management (SCM) software has helped to improve supply chain visibility, optimize inventory management, enhance transportation planning, and streamline warehouse operations. As a result, the use of cloud-based SCM software has become increasingly prevalent in agriculture, making it easier for farmers, suppliers, retailers, and consumers to connect and collaborate.

Additionally, cloud-based SCM software helps to ensure that the food supply chain remains safe, efficient, and sustainable, with real-time monitoring and tracking features providing immediate alerts in the event of any issues or concerns. Therefore, the use of cloud-based SCM software is expected to continue to grow within the agricultural industry, as it offers many benefits that can help improve the overall efficiency and sustainability of the food supply chain.

The implementation and maintenance of supply chain management (SCM) solutions for agriculture are expensive and require significant investments by end-users, making it challenging for small and medium-sized organizations in the agriculture industry. Additionally, the software's lengthy implementation and installation process can take several months, which can be a major concern for organizations that cannot operate with disruptions. The high costs associated with support, maintenance, and customization further inhibit the adoption of agriculture supply chain management software as these services can add to the software's price.

Moreover, the lack of internal IT expertise in the agriculture sector necessitates training to maximize the solutions' efficiency, leading to increased ownership costs. Hence, these factors, including maintenance costs and affordability pose a major challenge to the growth of the agricultural supply chain service market.

Segmentation Analysis

The global agricultural supply chain service market is segmented based on application, type, and geography.

By Application

Based on the application, the agricultural supply chain service market is categorized into food processing companies, wholesalers and retailers, farm trade companies, individual farmers, and others. The food processing companies segment dominated the market revenue of USD 372 million in 2022. For supply chain service providers, working with food processing companies requires developing reliable and efficient logistics solutions to ensure that goods are delivered on time and in optimal condition.

Additionally, supply chain service providers must also ensure that their operations adhere to industry standards and regulations for food safety and quality. Some of the largest food processing companies in the US include Tyson Foods, Inc., JBS USA, and Smithfield Foods, Inc., among others. These companies play a significant role in the food supply chain and working with them can offer growth opportunities and potential partnerships for supply chain service providers.

By Type

Based on the type, the agricultural supply chain service market is bifurcated into online and offline. The online segment held the highest CAGR of 10.69% in 2022. The agriculture supply chain service industry is increasingly transforming to online solutions to improve efficiency and streamline operations. Online services provide automation to the offline manual procedures of supply chain services, making it easier for agricultural producers to maintain track of their supply chains and suppliers. Online marketplaces and e-commerce platforms are facilitating direct-to-consumer sales and promoting transparency in the supply chain.

Digital platforms are also being used for data sharing and collaboration between various participants in the supply chain, enabling better coordination and decision-making. Moreover, online services can help supply chain service providers reduce costs, minimize delays, and improve communication with stakeholders. Overall, online solutions are playing a vital role in driving efficiency, transparency, and collaboration in the agriculture supply chain service industry.

Agricultural Supply Chain Service Market Regional Analysis

Based on regional analysis, the Global Agricultural Supply Chain Service Market is classified into North America, Europe, Asia Pacific, MEA, and Latin America.

North America accounted for the largest market with a revenue of 334.5 million in 2022. The agricultural supply chain service industry in North America, particularly the United States, is increasingly turning to online solutions to improve efficiency and streamline operations. Online services provide automation to the offline manual procedures of supply chain services, making it easier for agricultural producers to maintain track of their supply chains and suppliers. Digital platforms are also being used for data sharing and collaboration between various participants in the supply chain, enabling better coordination and decision-making.

Additionally, there are government initiatives such as the USDA's Farm Service Agency's grant program, which seeks to boost the resiliency of the food and agricultural supply chain in the United States. The industry players vary from agribusiness-focused virtual startup accelerator programs such as SAP.iO Foundry Paris to the data tech leader GrainChain, which utilizes the intersection of agritech and fintech to offer various products that facilitate agricultural transactions and financing by digitizing the supply chain and reducing counterparty risks.

Competitive Landscape

The global agricultural supply chain service industry study report will provide valuable insight with an emphasis on the fragmented nature of the global market. Prominent players are focusing on several key business strategies such as partnerships, mergers and acquisitions, product innovations, and joint ventures to expand their product portfolio and increase their respective market shares across different regions. Expansion & investments involve a range of strategic initiatives including investments in R&D activities, new manufacturing facilities, and supply chain optimization.

List of Key Companies in Agricultural Supply Chain Service Market

• IBM Corporation
• Trellis LTD
• AgriDigital
• Bext Holdings Inc.
• GrainChain, Inc.
• ChainPoint
• LexisNexis Risk Solutions (Proagrica)
• Agri Value Chain
• Geora Ltd.
• Eka
• FCE Group AG
• Intellync
• SAP SE

Key Industry Developments

• February 2023 (Seed Funding): GrainChain has secured USD 29 million in a recent round of funding aimed at accelerating its expansion in Latin America and the United States. The data company operates in the intersection of agritech and fintech, offering various products to facilitate agricultural transactions and financing by digitizing the supply chain and reducing counterparty risks.
• November 2021 (Partnership): Eka Software Solutions has become an official signatory of the United Nations Global Compact (UNGC), the largest corporate sustainability initiative in the world. As a signatory, Eka integrates the principles of the UNGC into its business operations to further promote sustainability for all stakeholders, including employees, customers, partners, and vendors.
• March 2020 (Launch): com has shared that their blockchain accelerator, Medici Ventures, has used a warrant to acquire an extra $5 million of equity in GrainChain, a keiretsu company, with the aim of expanding its innovative agricultural blockchain network.

The global Agricultural Supply Chain Service Market is segmented as:

By Application

• Food Processing Companies
• Wholesalers and Retailers
• Farm Trade Company
• Individual Farmers
• Others

By Type

• Online
• Offline

By Region

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • France
  • UK
  • Spain
  • Germany
  • Italy
  • Russia
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Rest of Asia Pacific
• Middle East & Africa
  • GCC
  • North Africa
  • South Africa
  • Rest of Middle East & Africa
• Latin America
  • Brazil
  • Argentina
  • Rest of Latin America