Importance of data collection and protection

Expert Ian Welsh, publishing director and podcast host for the Innovation Forum, join us to discuss the importance of on-farm data collection and why it is so valuable. Farm Food Facts host Joanna Guza and Ian discuss the importance of data collection globally, brands interest in agricultural data, data currency and how we keep farmers at the center of the conversation.

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Transcript

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 Joanna Guza:
The mission of US Farmers and Ranchers in Action is to bring all of American agriculture together with farmers and ranchers at the center to collectively identify and tackle critical long-term issues. We are excited to have a global perspective on Farm + Food + Facts today, and we welcome Ian Welsh from London to the show. Ian and his team at the Innovation Forum have been working hard to prepare for, and we'll be hosting the Future of Food and Beverage USA conference on May 29th through the 30th in Minneapolis, Minnesota. This two-day business conference will bring together leading brands and key stakeholders to identify the main areas of opportunity and innovation within the food and beverage industry. They're expecting over 60 speakers and over 30 practical sessions. We'll make sure that we drop a link in this description for you to learn more about the conference. Today we are going to talk about the importance of data collection and why it's so valuable. Well, Ian, let's start with the why. Why is on-farm data so important, and can you speak to the importance you've seen around the world?

Ian Welsh:
Thanks, Joanna. Yeah, I mean, commodity supply chains in agriculture develop to get x amount of product to a destination, uh, time being as cheaply as possible. So, you got a development of mass balance models, meaning that no one really knew where the delivered commodity has come from. But now we're finding farmers and growers around the world are being asked by their customers for transparency. Brands and buyers are under big pressure to know their supply chains, not least because of the c-suite commitments to net zero and in social and human rights issue. So companies are under real pressure from their stakeholders, including increasingly shareholders and investors. Those hold the money to do the right thing and track social and environmental impacts. However, to achieve this transparency request data, as an aside, actually just talking about mass balance, I mean, we've been seeing how it's possible to break mass balance, uh, models. Cotton Connect is a nonprofit that works with cotton farmers in Asia, and they've developed traceable, sustainable, uh, supply chains in a sector where the mass balance approach dominates. I mean, all in the world and the US and everywhere else. So it can be done. They've, they've shown it and demonstrates and it's just takes enough members of a value chain to want to do it.

Joanna Guza:
And Ian, I know that you are well versed globally. Who's more ahead in the whole transparency game? Is it the United States? Is it Europe? Is it Southeast Asia? Who have you seen doing the best job of being transparent and having that system in place?

Ian Welsh:
I think there's good and bad everywhere, I think. But what's been quite interesting, the palm oil sector in Southeast Asia had a terribly poor reputation. 10 plus years ago, a lot of deforestation in Southeast Asia linked to palm oil, a lot of destruction of ecosystems including megafauna, the orangutans, very high profile campaigning against the palm oil sector, and they turned it around. If you look now, palm oil and Southeast Asia is significantly less complicated in deforestation. It has really developed much more sustainable supply chains. It has developed this sort of data transparency with their suppliers that frankly the buyers of palm oil and palm oil derived goods in the West and in western Europe, north America, they were demanding of the sector, particularly when there was all this high profile campaigning against palm oil sector and it's made a huge difference and they really have turned it around. So I think if anyone wants to see an example of how this can be done in practice, I mean, I mentioned cotton just now, but also palm oil in Southeast Asia really has changed. And all the big activist campaigners will tell you this, some of the guys who was make throwing the most brick bats 10 years ago were now say, well, look, these guys have turned around. 

Joanna Guza:
We're learning from our past and we're getting better. I mean, you know, this, most farms are generational. So we're seeing what's happened in the past and just making it better for the future. Now let's talk specifically about brands. You know, why are brands interested in agriculture? Data

Ian Welsh:
Brands really have been the leaders in this area for some time. Really big companies have, you know, again, because of the rise of, of perhaps activism that's more transparent. So everyone can see and point fingers at companies and what they're doing and when they're doing things badly or doing negatively or negative have negative impacts. You know, people are pointing their fingers. So a lot of brands, especially consumer brands, have taken this on board and really want to be moving forward and not impacting negatively and having products that their customers can be proud of. But leadership knows really knowing what's in your products, you need to know where they came from and you need to know who made them. And that's what consumers increasingly want. And we're seeing this around the world and that's what regulators are now recruiting and requiring as well.

Now regulation has really become a massive driver in all of us. I think particularly the move towards a due diligence approach, which is really very prevalent here in Europe. I'm speaking to you from Amsterdam right now, the new legislation in Europe around deforestation, the EUDR we fully implemented this year. This has got six key deforestation linked commodities, soy, beef, palm oil, wood, cocoa, coffee and rubber. They're all in scope of the regulation. Uh, and no commodity or derived product can enter the EU market that's linked to deforestation, which means, in effect linked to risks of deforestation. And the regulation as currently worded, is very much an either or, either it's in and it can come in or it isn't, and it can't come in. So product either passes or it doesn't. And, and companies have to prove no links to deforestation.

And this can only be done with detailed verifiable data. So, the consequences of EUDR and other, uh, direct other due diligence approaches is potentially to exclude some farmers from some markets, particularly if they don't have the data to prove that they're in scope. Big palm oil business, Musim Mass, which is headquartered in Singapore and operations across Southeast Asia, they've publicly said that small holder farmers who make up a significant proportion of palm oil simply just have to be excluded from their EU supply chain to allow Musim Mass to be certain that its customers are not importing palm oil products with deforestation risk. So what's, you're exactly the opposite of what the regulation was designed to do. But on top of that, no one can be in scoping this regulation unless they've got the right data, they need to be able to prove that, uh, there's no deforestation, uh, links to their products.

Joanna Guza:
And why is it so valuable for science-based decisions and potential data currency?

Ian Welsh:
Science-based decisions, science-based targets, something that so many companies are setting now their net zero targets and they move towards net zero over the net coming decades. But these sort of science-based targets require data and there's real potential, I think for companies to develop better data to allow 'em to hit their targets and it become increasingly valuable to them. But then beyond that, actually there's, um, actual market based value in data because I can see potential from the carbon markets and the future perhaps markets for biodiversity credits to provide critical income for farmers, uh, just doing what they've been doing for generations, being custodians of ecosystems and soils as they have done it for generations. As you said, so many farms are generational and these people have been looking after, uh, ecosystems and, and the land for so long. So there's lots of reasons why data can become viable in so many different ways.

Joanna Guza:
And what is the conversation around data protection and what have you seen implemented?

Ian Welsh:
Well, I think it's essential. However, I don't think we've found an effective answer to the, whose data is it anyway questioned yet farmers may be understandably, uh, being obviously, uh, concerned about sharing data, who's going to use it and how. So, security in that sense is really very important. And there are a number of solutions emerging with data security front of mind. And as, um, the markets, as I mentioned before, the carbon markets, biodiversity credit markets potentially develop, I think we'll see an ever more awareness of the value and the importance of security, of data. We can perhaps talk a little bit later about, you know, what rationalization around, um, approaches to data looks like, but I think certainly the there will be ever increasing, uh, awareness that data just will be ever more viable. 

Joanna Guza:
Right. And I think it's important that you're asking the right questions when you might be getting into a contract, when you're gonna be sharing your data with different companies, make sure you're reading that fine print. How do we keep farmers and ranchers at the center of the conversations so brands don't steer the conversation with marketing tactics?

Ian Welsh:
I think it's all about awareness of everybody in the value chain of the, the real value that the value of food, frankly. And then the value added by those that that grow it. There's been a lack of respect, I think, uh, to growing communities around the world and everybody else in the value chain. All their intent in doing is getting, getting the product, as I said at the beginning around commoditized, um, supply chains, getting the product to their customers as cheaply as possible. And if the growers can be screwed to the ground on price, well that's great and that approach really has to change. Um, I think we're seeing it, we're seeing a lot of companies, food center companies, increasingly aware of the need to, uh, work with farmers because in some commodities, for example, coffee, cocoa being prime examples, there's a distinct lack of young people coming through who want to be farmers in those two sectors.

So, they get real aging population of farmers who, where's it gonna come from? I mean, you can't imagine the world without, uh, without coffee or chocolate. Um, so, you know, we need to have people that are gonna grow it for us. And there's a real awareness in these two sectors in particular of what that means in terms of farming and incentives for farmers. Um, so that's, that's one thing. Communication really, you know, we have to talk to, we have to talk, talk to each other. Um, and I do sometimes think that, um, farmer voices are excluded from conversations. We, innovation Forum. We are very keen to get farmer voices onto or into our conversations, into our events on our podcast. Um, and in fact, your colleagues are coming to our conference in Minneapolis, which would be great. And so I think respect for farmers and communication with them is very important.

And then when we, when you do have rules around trying to establish level playing fields for, for farmers and others in, uh, the in supply chains, you know, implement them. So, there's a fairness of approach there. From a farmer's perspective, I do think that there's sometimes a lack of awareness of the power of collective action. You know, cooperatives working together can really establish, you know, a, a more collective voice in getting what impacts farmers more front of mind for, for everyone else. And I think we do need to be much better aligned on incentives that drive progress. If a farmer's doing the right thing, if a farmer's providing information for farmers prepared to data share with customers, then, you know, reward that farmer for doing that. If a farmer's prepared to implement, you know, a regenerative agriculture approach because that's what their customers are asking for, well look, reward the farmer for doing that and don't expect all the initial costs. 'cause there always is gonna be initial cost. Don't expect that initial cost just to be lump straight onto the farmer, as has always been the case in the past. So I think those are the sort of things that, um, you know, can really help I guess keep farmers in the conversation and empower them to be in that conversation.

Joanna Guza:
Right. And that's the center, the core of USFRA is to make sure that farmers and ranchers are at that center of the conversation. You know, one thing I think that's interesting, Ian, you mentioned those incentives, which I agree, but I know the million dollar question has always been, well, who pays for that then? Is that the consumer? Is that somewhere in the supply chain? Is that the brand that's paying for that? What have you kind of seen around the world or maybe the, around that conversation?

Ian Welsh:
It's a longstanding question, isn't it? And again, it's one, I don't think there's a, a satisfactory answer to it. I mean, the answer is that, um, everyone should really pay, shouldn't they? And should, should pay it on a fair basis. But what it shouldn't be is it's all done down to the farmer said, right, please, you know, implement these new processes. And oh, by the way, the price isn't changing. I think there's an awful lot to be talked about around waste. So much of food in the food sector, so much of the what's brought out the ground doesn't reach the consumers. I mean, there also, there's, there's waste at the consumer end, but the majority of the waste is in the process of getting food out the ground and to, to the shops. So there really surely can be an awful lot more done and on, on lessening food waste.

I know it's something that people have been trying to do for ages, but it does feel that there's some exciting things that can be done to eliminate waste. And of course, if you can cut, cut down on waste, then there's, uh, you know, there's more available products to be sold. There's more cash per crop available. So there's, you know, there's money there that can be used to develop, uh, long term regenerative agriculture, for example, processes. And I think we do as consumers need to accept that we've been paying far less than our food is worth. We need to educate ourselves around the value of food. It's something that we've just simply seemed to have lost, um, in the last, you know, last half century, particularly I'm talking about in in the West, you know, in the western Europe, north America. And, you know, there's, there really can be a lot to be done in terms of, uh, consumer awareness, consumer knowing more about where the food comes from and what its real value is.

Joanna Guza:
Very interesting conversation with you, Ian. We could probably talk for another hour, but you, let's wrap this up with our last question. You know, what future items are you keeping an eye on in the space of agricultural data?

Ian Welsh:
I think we're gonna see an awful lot around moving away from carbon focus and thinking more about, uh, valuing nature-based solutions. I'll give you an example. We had an event in Washington DC last year, uh, looking at, um, scope three supply chain emissions. And we had a leading brand. We were under Chatham House Rules. I can't tell you who they were, who told, uh, openly to the room. Uh, but they felt thought they were doing pretty well on their scope one and two emissions. So there were more direct, uh, emissions getting there in scope three, but frankly had no idea at all how they were gonna tackle nature based impacts effectively. And so that tells me that we've got an awful long way to go because I think people are accepting, we can't just talk about carbon all the time. Carbon's easy because you can measure it, but we need to be thinking about, um, biodiversity impacts as well.

Interestingly enough, I'm speaking as I said from Amsterdam 'cause we've got the European leg of our, uh, Innovation Forum Future of Food and Beverage Conference starting tomorrow. And we're starting with a workshop with, um, sector experts talking all about data-driven farming and the tools, technologies necessary for sustainable sourcing. So standardizing frameworks and systems essential for scale, how to help farmers navigate the digital transition, how food and beverage companies can develop adaptable frameworks and data requirements that address supply chain complexities. And then how to foster value chain collaboration, bringing in agronomists, suppliers, brands, technology companies, farmers, et cetera, et cetera. So, involving everybody in trying to find data solutions that can work, because, ultimately I think what it can boils down to for solutions to work at scale data is gonna be the king.

Joanna Guza:
Well, it's such an exciting time to be in agriculture. And Ian, we're glad to have you on our side sharing some insight. If you found this conversation valuable, we recommend that you check out the Innovation Forum and their upcoming event, the Future of Food and Beverage USA conference on May 29th through the 30th in Minneapolis, Minnesota, USFRA plays the critical role of creating opportunities for collaboration, information sharing, and solution development for the full agricultural value chain. This podcast is an example of that. Well, we appreciate your precious time, and if you enjoyed listening to our podcast, please subscribe and rate us on your favorite podcast app. Tune in again. I'm Joanna Guza for Farm + Food + Facts.