Yevgeny Osipov: Open Agribusiness — Open up or Die
The Kernel business model today includes 7 main areas in which the company has achieved quite good results. In each of our businesses, we intend to grow by 50-100% in the coming years.
In the case of Agribusiness, the goal of Kernel is not the size, but the efficiency of each specific field. In 2017, we increased the land bank by almost 200,000 hectares, thus realizing an ambitious goal in the growth strategy. However, it was important for us not to lose effectiveness. In addition, we have learned to manage large tracts of land, properly distribute technology and motivate people.
Our production experience has allowed us to accumulate a large amount of data, with the help of which we intend to improve business efficiency through automation. Now Agribusiness Kernel is working on the development of BigData and the creation of its own artificial intelligence in the company. The division team develops and gradually implements the #DigitalAgriBusiness project. This is the world's first integrated intellectual system for the production of agricultural crops.
We are ready to share our expertise with our agricultural partners, talk about the use of various technologies and the obtained production results.
What is our goal?
We realize that today Ukraine produces 60 million tons of grain annually, but to reach a maximum in terms of yield it is still very far away. In Kernel, the yield in almost all regions is 30-50% higher than the average results in the country. Based on the indicators that we currently see in our fields, we are confident that Ukraine can produce 100 million tons of grain per year. It was this goal that formed the foundation of the idea of our partner project Open Agribusiness.
What exactly will we do to achieve this? We are completely opening flow charts, showing how we produce a particular crop in different regions, provide access to the field monitoring with a number of tools based on the Cropio system. In Cropio, information is accumulated about crops, their structure, the history of the conducted agro-operations with all the details, the vegetation assessment. It is possible to compare the fields with each other in the context of several years, in order to determine the heterogeneity and even to obtain yield forecasts. At the same time, the system allows one to evaluate the weather conditions and the dynamics of the growing season in specific areas.
We uploaded 72 thousand hectares of our fields into the system. All agricultural partners who supply us with products have access to this data. Now they see our specific field, its history, hybrid, protection, yield forecast. We want people to be motivated by this data and want to go ahead with high results.
For the convenience of working with these and other useful services, we launched a multifunctional portal for agricultural producers called Open Agribusiness. Here, in real time mode, you can get actual purchase prices for grains and oilseeds, find out the conditions of the Kernel’s forward program, see the real results of applying a particular technology on the holding’s fields and decide whether to use it in your field, learn about the leading world agricultural practices.
Here our partners will be able to monitor the results and yield on the fields of Kernel and other program participants. This will give them the necessary motivation to develop their production and move forward.
The logical question is: are we not afraid of the increase of our competitors number? No, we are not. There is no conflict of interest. Today, in addition to our 72 thousand fields, another 201 thousand hectares of partner fields have been loaded into the Cropio system. That is, the total data array in the system is 273 thousand hectares. This is a huge amount of work for our internal teams. In the future, we plan to increase the number of open data.
I believe that it is through open relations, mutual exchanges of experience on the use of technology and an independent monitoring system that we will come to a Ukrainian 100 million tons of grain. And this is not only a leap forward for the entire agro-industrial complex, but also for the infrastructure of related businesses, foreign exchange earnings for the country and general growth of the country's economy.
Therefore, I encourage everyone to be open!
Yevgeny Osipov, CEO of Kernel