By Jacob Bunge
U.S. agricultural companies reached an agreement with farm
groups on principles governing the companies' use of crop data, a
deal aimed at allaying privacy and information-security concerns as
the Farm Belt embraces new technology.
The first-of-its-kind accord, expected to be announced Thursday
by the American Farm Bureau Federation, marks the biggest step yet
by companies such as Monsanto Co. and Deere & Co. to quell
farmers' fears about the expanded use of data on specific fields in
planting technology and other services sold to growers.
The deal seeks to unite the industry on practices for
collecting, storing and using information ranging from planting
dates to pesticide applications and crop yields. Tractors and
combines collect this information on thumb drives or beam it to
remote computer servers. Agribusinesses then analyze the data to
provide services that help farmers choose what seeds to plant and
how to plan harvests.
Smaller agricultural companies also are working on ways to
collect and distribute farmers' data, potentially challenging big
seed and farm-equipment companies that have bet the new services
could become a multibillion-dollar business.
"We want to allow farmers the confidence they need to adopt
these game-changing technologies," said American Farm Bureau
President Bob Stallman.
While a data-driven approach to farming has boosted some
farmers' production and helped them save money on sprays and
fertilizer, others have expressed reservations about giving big
agricultural companies a deep look into their businesses.
The Farm Bureau, based in Washington, has warned that seed
companies may have an interest in persuading farmers to buy more
seeds, or that services could direct farmers to purchase certain
sprays and machinery.
Nearly nine in 10 farmers surveyed by the organization last
summer said they weren't fully aware of how their data was being
used by companies, according to survey results released in October.
About three-fourths of respondents feared it could be used by
companies for "market-sensitive commercial activities" or accessed
by government regulators.
The Farm Bureau earlier this year gathered a dozen agribusiness
firms and farmer groups for a series of meetings geared toward
forging a set of voluntary guidelines focused on farm data. The
principles that the two sides have agreed to specify that farmers
own the information generated from their operations and that
companies collecting the data must clearly state how it may be used
and the types of third parties that may be granted access to
it.
Monsanto, Deere, DuPont Co., Dow Chemical Co. and other seed and
equipment companies have signed on to the document, which was
reviewed by The Wall Street Journal. The National Farmers Union,
the National Corn Growers Association and other groups representing
farmers also signed it.
"This educates the farmers as they're making purchasing
decisions" on technology, said David Friedberg, chief executive of
Climate Corp., Monsanto's data-services unit. "I do think it'll
have an effect with the folks that have been vocally
skeptical."
Though the new principles are voluntary, the Farm Bureau's Mr.
Stallman said "peer and market pressure" will push more companies
to adhere to them.
Monsanto, which makes seeds and crop sprays, has spent more than
$1 billion in recent years on acquisitions to expand its technology
offerings. DuPont estimated earlier this year that farm-data
services will generate $500 million in annual sales for the
chemical company over the coming decade.
Other firms are looking at ways to turn farmers' data into
another marketable commodity. Farmobile LLC, a startup based in
suburban Kansas City, Mo., is developing a system that allows farm
managers to monitor their operations in real-time using an
application on Apple Inc.'s iPad.
The service would enable farmers to store their data on remote
servers, using "cloud" technology. Farmers could choose to sell
their data to agriculture companies or commodity-market speculators
in what Farmobile calls a data exchange.
Farmobile's transmitters plug into farmers' tractors and
combines, allowing the company to collect information on planting,
fertilization, pesticide treatments and harvests. That could be
valuable to companies that want to know such details as the pace of
Iowa's corn harvest or whether Indiana's soybean crop is grappling
with hard-to-kill weeds. Those companies could query the database
and offer bids to pay individual farmers for their data.
"Every year farmers grow corn, wheat and soybeans, they harvest
that and sell it," said Jason Tatge, Farmobile's co-founder and
chief executive. "We want to do the same thing with their
data."
Write to Jacob Bunge at jacob.bunge@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires