State of the Digital Agriculture Sector: Harnessing the Potential of Digital for Impact Across Agricultural Value Chains in Sub-Saharan Africa

The digitalization of agriculture, often referred to as ‘D4Ag,’ is a rapidly evolving sector in low- to middle-income countries (LMICs). This transformation has the potential to reshape global development outcomes by significantly improving environmental sustainability, social inclusion, economic growth, and food security. In this article, we delve into the key findings and unique aspects of a groundbreaking report that sheds light on the state of the D4Ag ecosystem in LMICs.

What Sets This Report Apart?

This report stands out as a pioneering effort, providing a comprehensive assessment of the D4Ag landscape across LMICs. Here are some of the unique features that make it invaluable:

1. Global Benchmark: The report offers a first-of-its-kind global benchmark of the state and penetration of the D4Ag ecosystem across LMICs.
2. In-Depth Analyses: It provides in-depth analyses of critical aspects such as funding and investment, gender and social inclusion, and the adoption of digital climate-smart agriculture practices.
3. Regional Insights: The report offers detailed regional insights into South Asia, Southeast Asia, Sub-Saharan Africa, and Latin America and the Caribbean, allowing for direct comparisons.
4. Future Outlook: It presents tangible and quantitative projections for the D4Ag sector, looking ahead to 2033.

Key Insights from the Report

Here are some of the most significant findings from the report:

1. Diverse Solutions: The report identifies nearly 1,400 active D4Ag solutions across LMICs, with a staggering presence in 81 different countries. However, just ten markets account for 67% of these active solutions.
2. User Base: D4Ag solutions have garnered over 50 million active users across the focus regions, equivalent to approximately 10% of smallholder farming households in LMICs.
3. User Growth: The number of D4Ag solutions with more than one million registrants has increased from 11 to 27 between 2018 and 2022.
4. Gender Inclusion: On average, 26% of users for any given D4Ag solution are female, highlighting the need for further efforts to enhance gender inclusivity in the sector.
5. Financial Viability: Encouragingly, up to half of the established D4Ag innovators in LMICs are operating at or above break-even, demonstrating the sector’s potential for sustainability.
6. Investment: Up until 2021, LMIC regions witnessed the deployment of over $13 billion in funding and investment for AgTech, comprising about one-third of the global total.
7. Future Value: Looking ahead, the report suggests that the difference between a “derailed” and “thriving” D4Ag sector could represent approximately $450 billion of value per annum, equivalent to 9% of farm-gate greenhouse gas emissions. Furthermore, this transformation could provide 64 million women with access to digital agriculture solutions. In the most optimistic scenario, as many as 224 million farmers in the focus regions could actively use D4Ag solutions in the next ten years, representing a Compound Annual Growth Rate (CAGR) of 16%.

The digitalization of agriculture in LMICs holds the promise of revolutionizing farming practices, improving livelihoods, and ensuring food security while mitigating environmental impact. With the insights provided in this report, policymakers, investors, and stakeholders have the opportunity to drive positive change and unlock the full potential of D4Ag in LMICs.