EVENT HIGHLIGHTS | Digital Farming: How can the EU turn ambitions into a reality?

In mid-November 2020, PubAffairs Bruxelles organised an evening discussion regarding the future of digital farming in Europe with Ms Nathalie Sauze-Vandevyver, Director Quality, Research & Innovation, Outreach, DG AGRI, European Commission, Mr Franc Bogovič MEP (SLO/EPP), Mr Pekka Pesonen, Secretary General, Copa Cogeca, Mr Joao Pacheco, Senior Fellow, Farm Europe and Mr Daniel Pereira, Head of The Climate Corporation Europe Middle East and Africa, Bayer.

The debate was moderated by Sarantis Michalopoulos, Journalist, Euractiv.

Sarantis Michalopoulos presented the panel and asked Ms Nathalie Sauze-Vandevyver to provide a picture of the general situation in Europe regarding precision farming, together with the overall objectives that the EU aims to achieve in the field.

Ms Nathalie Sauze-Vandevyver began her remarks by stating that, on the whole, digitalisation has been a high priority for the EU. This is well reflected from the main Commission’s policy stances, such as the headline ambition “A Europe fit for the digital age”. As far as the agricultural sector is concerned, the representative of the Commission pointed out how digitalisation plays an indispensable role in achieving the objectives of the EU Green Deal  and the Farm to Fork Strategy (F2F). The objectives put forward in these two pivotal strategic documents include next to sustainability ambitions, the necessity to reinforce food security and strengthen Europe’s competitiveness on the global stage, she added. The speaker also stressed the difficulty of two particular challenges ahead: sustainability and biodiversity protection, which are at the core of the EU action. In fact, the EU has been putting considerable efforts into reducing emissions in the agricultural sector by promoting organic products and by reducing the use of fertilisers and pesticides. Furthermore, the speaker highlighted that the overall challenge is to maintain the coherence between different policy objectives, such as, for example, coupling sustainability and farmers’ profitable business models. In this regard, Ms Sauze-Vandevyver explained that digitalisation and precision farming should be underpinning links that should enable farmers to optimise both the inputs and the outputs by efficiency gains, by reducing both financial and environmental costs, and thus by raising their income. Subsequently, she remarked that one of the first priorities of the EU is to create an environment that enables farmers to make effective use of digital technologies in order to – among others – optimise the food production process and attract young people to work in this sector. Ms Sauze-Vandevyver specified that the EU is not starting anew since there are already several ongoing polices and regulations. However, she specified, further investments in innovation will trigger the deployment of the necessary infrastructure, such as broadband connectivity, notably lacking in several rural areas. In this regard, the speaker mentioned how EU programmes such as Horizon Europe and the European Innovation Partnership for Agricultural productivity and Sustainability (EIP-AGRI) are of primary importance to providing connectivity and fostering rural development. The speaker subsequently highlighted that a significant task for the future of the EU agricultural sector, and one of the main factors determining the effectiveness of digitalisation, is the creation of a pool of data. Indeed, she explained, the creation of a Common European Agriculture data space.  In addition, it would be key to provide farmers with expertise and the best practices available, and to enable them to gather information on a variety of matters beyond those strictly needed for their daily activities, such as biodiversity.

 The moderator asked Mr Franc Bogovič MEP to what extent the EU Green Deal and the Farm to Fork Strategy would be able to shape the future of the Common Agricultural Policy (CAP). He also questioned the MEP on how to convince EU Member States to further embrace digitalisation for rural areas.

 Mr Franc Bogovič MEP started his speech by stressing the importance of Smart Villages as a means to (re)develop rural areas and provide for connectivity and, as a consequence, to foster the most innovative technologies in Europe’s agricultural sector. Furthermore, he mentioned his personal efforts to include a strategy for Smart Villages in the national strategic plans of the future of the CAP. Mr Bogovič further developed the topic by explaining that the creation of connected villages would lead the way to the establishment of the basic infrastructure in rural areas, thus providing the prerequisites to reach the goals set by the EU Green Deal and the Farm to Fork (F2F) strategies. Furthermore, as connectivity is an essential requirement for a successful implementation of the CAP reform, the speaker argued that such a precondition is lacking in most parts of Europe. In fact, broadband connectivity, while present in more than 90% of urban areas, has not yet been deployed in more than half of the rural zones of the continent, hindering the possibilities of access to both innovative production processes and new markets for European farmers. Moreover, the Corona crisis has forced many people to switch to smart working and e-learning, which proved to be cumbersome in those areas where access to a stable connection is not guaranteed. To overcome these burdens, Mr Bogovič stressed the necessity for a holistic approach, which should combine the efforts to modernise agriculture with regional development polices. The speaker subsequently pointed out how the pandemic has also offered the opportunity to realise the true potential of remote areas. Indeed, while Europeans have rediscovered the values of rural areas as an alternative to cities, these zones have played a fundamental role in ensuring food security during the first outbreak of the virus. He concluded by reiterating the importance of the set-up of Smart Villages for the EU and by emphasising that providing the basic infrastructure would also increase the quality of life in rural areas, while helping small and medium-sized enterprises (SMEs) create more attractive jobs, and, eventually, attract a larger portion of young workers.

Turning to Mr Joao Pacheco, the moderator asked about the likely scenarios in the deployment of digital farming at the EU level and the best ways to foster digitalisation from a regulatory point of view.

 Mr Joao Pacheco began his remarks by emphasising the importance of the future approach that the EU will take in the upcoming months. He specified that, on the one hand, the goals of the F2F Strategy, coherently with the EU Green Deal and the Biodiversity Strategy, are to reduce the use of chemical pesticides and fertilisers in agriculture; on the other hand, this process might imply reduced food production and, therefore, a more precarious food security setting, he added. Furthermore, the speaker highlighted that this process could also signify a loss of income for farmers in the short and medium term which has already been decreasing over the past years. Mr Pacheco subsequently explained that the future of the agricultural sector will be reliant upon the choices of the EU to operate this delicate transformation. He then clarified that investments will be crucial for the development of precision farming. In this regard, he explained that the budget of the new CAP should operate a massive shift of investments in the first and second pillar of the CAP, namely “direct payment to farmers” and “rural development polices”, in order to assist the green transition and incentivise the use of new technologies. Mr Pacheco also stressed the importance of this course of action since, in his opinion, the Recovery Fund and the part of the EU budget dedicated to agriculture are a gold opportunity to increase the adoption of innovative technologies. This virtuous process will eventually result in a cascade effect by reducing inputs while increasing production without necessarily putting at stake the farmers’ income. Mr Pacheco then went on to explain more in detail the governance-related actions necessary for Europe’s agricultural sector. Indeed, he clarified that there is not a single model to be adopted for the whole Union. Instead, the speaker argued, the old continent is characterised by deeply diversified geographical areas, a fact which requires tailored approaches. He mentioned as an example an organisational innovation which took place in Greece whereby, despite the morphology of the land not allowing for extensive farming, farmers united into cooperatives. According to this model, farmers pay a small membership fee for receiving, in exchange, services and expertise to foster precision farming, and thus maximise the outcome, despite the reduced dimension of the land. This approach, he continued, proved to be very effective. Moving towards the conclusion of his reply, Mr Pacheco further stressed the importance of investing in new technologies and the necessity of stimulating innovation among farmers. Nevertheless, he expressed reservations on the lack of a general direction given to European funds, as, in his opinion, the latter should be promoting investments for digital farming, instead of leaving the spending options to Member States.

The moderator questioned Mr Pekka Pesonen about the main barriers interfering in the uptake of digital farming in Europe. He also asked if the Union is heading towards a “two-speed Europe” with regard to digital farming.

Mr Pekka Pesonen started by highlighting the importance of a policy framework which grants funding and fosters innovation. The speaker continued by clarifying that the regulatory framework should not act as a “bottleneck” by slowing down the modernisation of the EU agricultural sector. The speaker also agreed on the fact that the lack of basic infrastructure in many parts of the continent is a major obstacle to digital farming. Indeed, he emphasised that, while policies are a means to shape our daily lives, they cannot prove effective if the preconditions are not in place. Mr Pesonen continued by explaining that further potential challenges concern consumer preferences, as trends are evolving and an increasingly higher number of consumers are opting for more sustainable and organic products. Within this context, the European market must rapidly evolve to comply with these demands and maintain its competitiveness, he added. On a different note, the speaker continued by stating that, as a result of the MFF decision, public expenditure will likely decrease in both relative and absolute terms in the immediate future. This would mean that while recovering from Covid-19, the EU farmers would have to become more sustainable with less public support. Therefore, according to Mr Pesonen, the additional income for farmers should be generated by the market. Proceeding with his speech, the representative of Copa Cogeca stressed the fact that the pandemic made evident how food security is yet to be achieved in Europe. For this reason, he called for a progressive approach to sustainability. While elaborating on his position, he urged the EU to first ensure a resilient and steady supply chain, and to foster an increasingly sustainable food production at a second stage. With regard to the second part of the moderator’s question, the speaker disagreed with the statement that the old continent is heading towards a “two-speed Europe” in terms of precision farming. Nevertheless, he also remarked that this could be a risk in the future if policies fail to incentivise investments and innovation. Continuing on this topic, he highlighted that this trend is more likely to occur within EU Member States themselves, rather than in the EU as a whole, as in the case of the differences between the north and south of Italy. The lack of basic infrastructure plays a major role in the modernisation process, he added, since it is more difficult to attract investments in these contexts. In his concluding remarks, Mr Pesonen stressed the necessity for a holistic approach when different policies are integrated in national strategic plans in order to ensure an even and fair growth of the sector across Europe.

Sarantis Michalopoulos turned to Mr Daniel Pereira and asked for his opinion regarding the implementation of more resilient supply chains and how to incentivise farmers to embrace digital technologies.

Mr Daniel Pereira started by explaining that, all over the world, investments in digital technologies have been increasing in the past years. Furthermore, the speaker mentioned that several innovative technologies are already available and that farmers are already adopting them. However, he specified that this process is still relatively slow, as farmers are not incentivised enough to adopt the newest tools available. Mr Pereira explained that this is due to two main factors: on the one hand, several farmers lack of knowledge regarding digital farming, making them reluctant to adopt these tools, while, on the other hand, several agri-food businesses, while fully understanding the potential of digital and precision farming, fail to see the added value that they can gain. The speaker proceeded by highlighting that the sector leans towards a sort of “conservatism” and, for this reason, farmers tend to use traditional means of production and/or ancestral methods and practices. In order to overcome these obstacles, Mr Pereira stressed the importance of policies which incentivise farmers to embrace digital technologies and to show that the new tools will not only be beneficial to consumers and the environment, but also to themselves. Furthermore, the speaker mentioned that, while young workers are more inclined to adopt digital farming, many farmers are still lacking the essential digital skills to efficiently use innovative tools. Therefore, future policies should also aim to educate the old generation of workers in order to incentivise the adoption of the newest and more efficient form of production. Mr Pereira subsequently explained that the legislation may also represent an obstacle. Indeed, he remarked that the European agricultural sector is highly regulated and in constant evolution. In this regard, while agreeing with Ms Sauze-Vandevyver on the fact that this setting can ensure high quality products, he specified that it may also create confusion, as some effective practices allowed around the world may be forbidden or limited within the EU. For this reason, he concluded, farmers must be provided with easily accessible information and regulatory stances which favour a swift adoption of cutting-edge methods and practices.

The moderator then proceeded to ask the panel to provide a more detailed picture of the state of the EU in terms of competitiveness in agriculture. He also questioned the speakers with regard to the interlink between the Recovery Fund and the CAP national strategic plans.

Mr Pesonen began by stating that Europe is currently falling behind in terms of innovation of the agricultural sector. According to the speaker, this is due to three main reasons. In the first place, the speaker stated that, as already mentioned, the basic infrastructure necessary for digital farming has not yet been deployed in several areas, hindering the adoption on new technologies. Secondly, Mr Pesonen specified that technologies and practices in the agricultural sector are developing rapidly, but the regulatory framework is slow to adapt to innovations. An example he used was that, despite the efforts of the EU to promote organic farming, many substances needed for this type of agriculture are still not regulated or lack authorisation to be used. Thirdly, the speaker highlighted how some innovative practices cannot be implemented as a result of the outdated legislation in the sector. For instance, aerial spraying has been tested in Europe for years and has been proven to be a highly valuable tool for precision farming to reduce the time needed for pesticides application significantly, he argued. However, under the current Directive for a Sustainable Use of Pesticides (SUD), the use of aerial spraying is forbidden in any form. Mr Pesonen concluded by explaining how the impossibility of adopting this valuable practice, widely implemented in Asia and America, is a clear example of the reason behind the EU’s loss of competitiveness in the agricultural sector.

Ms Sauze-Vandevyver started by explaining that European regulations, despite being sometimes complex, are also necessary, while agreeing that the institutions are setting a high bar from a regulatory point of view, a fact which may sometimes create barriers for innovation. However, she also highlighted that regulations are also crucial to providing for the highest quality possible of agri-food products and to gaining consumers’ trust. In this connection, she affirmed that, establishing rigorous processes is indispensable to creating an overall trustful environment. She subsequently specified that this factor plays an important role on a global scale in order to enhance the European reputation in international markets as well. Nevertheless, Ms Sauze-Vandevyver indicated that the EU needs to adapt quicker to keep the pace with other parts of the globe in the rolling-out of cutting-edge technologies. Nevertheless, she underscored that the European policy-making process needs in most cases to take into account the position of all legislators at EU level and thus of all Member States and that the concertation among these polities often requires time and deep and careful talks. The speaker said that it is unlikely that the Recovery Fund will come with a degree of conditionality concerning the national strategic plans for agriculture. In fact, she explained, the European Commission has the task of fostering dialogue and providing help to Member States in order to reach common goals, including Green Deal objectives in the National CAP strategic plans. Ms Sauze-Vandevyver also reiterated the importance of platforms such as the Agriculture Knowledge and Innovation System (AKIS) and the necessity for Member States to put them in place. According to the Commission representative, these initiatives are fundamental to the spreading of knowledge and best practices across Europe. Ms Sauze-Vandevyver finally remarked on the advisory role of the Commission through which proposals such as the Soil Health Mission and initiatives aiming at coupling innovative business models with climate ambitions are developed.

The moderator asked what effects the pandemic had in the digitalisation process of the agricultural sector and how sustainability requirements can affect international trade.

Mr Pereira explained how less than 30% of farmers have until now invested significant capital to modernise their production and apply new technologies for precision farming. According to the speaker, the pandemic will further delay the whole process. However, he also pointed out that this situation may change if farmers are provided with the correct incentives to invest in digitalisation. Subsequently, Mr Pereira specified that the European sector is still in a predominant position. Nevertheless, the valuable growth that characterises digital agriculture may rapidly shorten the gap between the EU and other countries unless Europe adapts to the current situation, he specified. Mr Pereira subsequently highlighted how the diversity that characterises territories within the EU is beneficial and that the EU is well versed in dealing with different situations and in responding to the challenges that every given territory can bring about. As a result, the EU has to adopt a versatile approach which would also enable Europe to gather a broad variety of data that will prove fundamental to both policy making and commercial development. However, Mr Pereira stated that digital farming will not be the “silver bullet” to fulfil all European ambitions for this sector, as the latter will be fulfilled if they were to be connected in a comprehensive way with other complementary policies. In conclusion, Mr Pereira further called for policies to incentivise the use of digital technologies more and to provide the conditions to facilitate their adoption among farmers.

Mr Pacheco shared a less optimistic point of view, as he predicted that the Corona crisis will deeply impact the adoption of new technologies. In fact, considering that farmers’ income has already been decreasing in the past years, the speaker stated that the current situation will further discourage them from fully switching to digital farming. Furthermore, as Mr Pesonen previously stated, public expenditures will also decrease in the immediate future, making the adoption of digital farming more challenging, especially in the poorest areas of Europe. This process, he continued, will likely have a knock-on effect on the sector as a whole. Furthermore, the aggravation of climate change is increasingly affecting agriculture all over the world, constituting a further challenge. Nevertheless, Mr Pacheco explained that these matters are not separate questions, but can be all solved via the adoption of a holistic approach by EU institutions. Getting into a more detailed explanation, the speaker first called for more focused action from European policymakers in order to deploy the infrastructure for digital farming and to provide the correct incentives for their adoption. Secondly, he highlighted the importance of educating farmers and equipping them with the necessary skills to become more competitive. According to the speaker, these actions would boost the spread of digital and precision farming, which will be the key to the fulfilment of the climate goals and to making the food supply chain more resilient. Finally, the speaker called upon the Commission to provide an assessment on the Farm to Fork and the Biodiversity strategies’ impacts in order to better understand their impact on farmers’ incomes and food security.

Mr Bogovič brought attention to the potential impact that Brexit may have for the future of the agricultural sector. In this regard, he stressed the necessity of having an assessment on the effects of Brexit on trade, especially considering the role of Great Britain as importer of primary products. Developing this topic further, the speaker also called for an exhaustive impact assessment concerning trade with third countries. Indeed, he remarked that the EU has to carefully study the origin of its imported resources and ensure that their production fulfils the sustainability requirements set by the European Union. As an example, he mentioned the talks that took place with regard to the Comprehensive Economic and Trade Agreement (CETA) with Canada, which was preceded by deep studies to set the standards for the quantity and quality of meat imported by the EU. Subsequently, Mr Bogovič briefly analysed the effects of the growth of the biological sector in Europe, as the Farm to Fork Strategy is setting the target to reach the 25% of cultivated land dedicated to biological products. However, the MEP explained that, due to economic and/or geographical reasons, some countries can reach this goal more easily and produce biological products at a more competitive price. The speaker stated that this possible development would create imbalances in the market between Member States and requires further analysis. Mr Bogovič concluded by further highlighting the importance of attracting young workers to the sector. He explained that young farmers are more willing to embrace digital technologies and have the skills to exploit them efficiently. For this reason, they can both spread knowledge among other farmers and show the added value provided by digital tools.

Mr Pesonen highlighted how the strength of the EU lies in the diversification of agri-food products and the high-quality standards that characterised them. The speaker agreed with Ms Sauze-Vandevyver, as this setting has ensured the European Union a role of relevance in the past years in international trade, he explained. However, the speaker also specified that this primacy has been challenged by other actors, given that countries such as New Zealand and Australia are also putting considerable efforts into promoting the sustainability of their agrifood sectors. For this reason, Mr Pesonen explained the importance of the European digital agenda for the agricultural sector, as EU competitors may soon close the gap. Subsequently, the speaker further highlighted the importance of finalising a policy framework that encourages innovation and investments in order to create additional income from the market. He also called for a harmonisation of the digital agenda among Member States in order to establish long-term policy coherence. In the conclusive part of his speech, Mr Pesonen encouraged a progressive approach to the question of digital farming, as the green transition will not be a sudden change, but the result of medium and long-term investments and efforts.

 In her closing remarks, Ms Sauze-Vandevyver agreed on the necessity of creating the proper environment for digitalisation and highlighted that an important tool is the multi-stakeholder approach that characterised many Research & Innovations actions in the EU. More specifically, she stressed the importance of bringing different actors together, from EU institutions to the Member States, as well as the private sector, in order to produce the most suitable regulatory framework for the sector. Moreover, she addressed the necessity of involving further farmers in the decision-making process. This feature, she stated, should make them more participative and should contribute to incentivising the adoption of digital technologies. Finally, she pointed out the fact that, while the European Commission is aiming to provide the tools to ensure a smooth transition, it will also be up to the Member States to make the right use of the tools put at their disposal.

The rest of the debate and the Q&A session covered the following issues: How the European Green Deal and Farm to Fork strategy could be improved to better respond to the needs of farmers and rural communities; how the EU and its Member States will determine the national and EU-wide plan for the EU ambition; which polities  will be in charge to resolve possible conflicts between EU institutions and Member States regarding the implementation of CAP-related policies; what the next step should be for  Europe’s green growth strategy to live up to the ambitious goal of enhancing resource efficiency and global competitiveness; the impact of sustainability requirements of the green transition concerning Europe’s trade relations; how digital farming can implement efficiency along the supply chain; how to strike a balance between farming digitalisation and the lack of digital skills.

Want to know more about the issues discussed in this debate? Then take a look at the selected sources provided below!

Precision farming, European Commission

CAP reform post-2020 – Setting the scene, Euroepan Parliament Think Tank

Analysis of links between CAP Reform and Green Deal, European  Commission Staff Working Document

Green Deal & CAP: FE analysis of ComAgri report, Farm Europe

Future of the Common Agricultural Policy, European Commission

Farm to Fork Strategy, European Commission

European Green Deal, European Commission

European Innovation Partnership for Agricultural productivity and Sustainability (EIP-AGRI)

Smart Villages Portal, European Commission

A Europe fit for the digital age, European Commission

Horizon Europe, European Commission

EU Biodiversity Strategy for 2030, European Commission

EU farmers: Unlock potential of agricultural drones or risk falling behind, Euractiv

Agriculture Knowledge and Innovation System (AKIS), European Commission

Proposal for a Soil Health Mission: Caring for Soil is Caring for Life, European Commission

EU agriculture and the withdrawal of the United Kingdom from the EU

EU-Canada Comprehensive Economic and Trade Agreement (CETA), European Commission

Digital Farming, Bayer