Agriculture once seemed to be the most promising industry for drones to disrupt, but slow adoption has forced many drone companies to look elsewhere for faster returns. While drones have so far not made extensive headway onto farms, it is clear to me that they perfectly complement the precision agriculture technology that is steadily taking over the industry. I looked back at another technological disruption in agriculture to see how it compares to drone adoption and what we might learn from how it eventually happened. Hybrid seeds were adopted over the period 1936-1939 with such rapidity and completeness that it has become a popular subject for economic studies. Because of that, it’s a best case scenario to compare against drone adoption.
Hybrid seed adoption benefited from several factors that are unlikely to be repeated, not the least of which being that Henry Agard Wallace, the founder of Pioneer Hi-Bred Company, became the Secretary of Agriculture in 1933 and used his new post to espouse the benefits of hybrid seed. Early adopters of hybrids avoided the bulk of crop losses in the droughts of 1934 and 1936. Drought resistant hybrids had a chance to show their full benefits just as they were becoming affordable. A drone’s benefit on the farm is less visible, more likely to manifest itself in an incrementally improved operating profit in normal years. Another factor in the rapid uptake in hybrid varieties was the fact that they required little to no change in day-to-day operations. Farmers simply had to buy a different seed. Drones are, by contrast, more disruptive to a farmer’s routines, even if the total time investment is quite low over the course of a season.
Drones have, however, demonstrated some factors relating to adoption that match or beat early hybrids. Hybrids followed a series of technological improvements and declining costs that drones are currently following. When hybrids were first made commercially available in the 1920s, prices started at over $25 an acre, and adoption was almost nonexistent for years. As the technology improved and competition grew, prices tumbled. Even at $3 an acre in the early 1930s, the economic benefit was questionable. Today we see the same thing happening with drones. Just a few years ago, an ag drone cost $20,000-30,000. Studies have shown positive returns on remote sensing technology that are largely wiped out by the cost of data collection.
But now, the cost of a farm-ready drone is dropping fast. With an investment of just a few thousand dollars, modest use of an owner-operated drone can easily bring remote sensing costs down below $0.25/acre.
It’s unlikely that drones will achieve the same explosive growth in agriculture that hybrids did in the 1930s. Still, we can take away some lessons from how it happened to maximise drone adoption within the limits of the technology and the factors affecting the farming industry today. My belief is that costs still need to drop a little more before we can convince the bulk of farmers to give it a try. It may seem like the return on investment is already there but it’s important to recognise the perceived and actual risks as well as the other costs of a precision ag program. Once the drone industry is more established, we’ll be able to prove and improve the economic benefit. In the years after hybrid adoption, seed producers were able to improve performance and command higher prices.
For now, the price of drones and imagery analysis need to reflect their untested position in the agriculture industry in order to be an attractive investment for large numbers of farmers.