Friday, 21 July 2017 07:55

NZ precision ag firm expands

Written by  Nigel Malthus
CropLogic chief executive Jamie Cairns. CropLogic chief executive Jamie Cairns.

The Lincoln precision agriculture company CropLogic is expanding into the North American market via its takeover of a Washington State firm.

CropLogic, which markets a “predictive decision-support system for agriculture”, has bought Professional Ag Services Inc (ProAg), in Pasco, in the Columbia River basin region of southern Washington.

Because ProAg has clients throughout Washington and the surrounding areas of Oregon, Idaho and Canada, CropLogic says the deal will give it immediate access to the lucrative North American agricultural industry, and an established channel to develop in those key regions.

CropLogic chief executive Jamie Cairns says the takeover gives it a team of experienced agronomists with an established client base. It would otherwise have been “a long road” to get a foothold in the American market.

Using aerial imaging and in-field sensors, ProAg has at least 40,000ha under management, including 24,000ha of high-margin crops, and employs 16 staff.

“Strategic acquisitions provide CropLogic with immediate market access, relationships and acres under management, and have always been a fundamental part of our market entry strategy,” said Cairns.

“This acquisition meets many of our initial North American goals, and both parties are excited with the plans for the upcoming years.

“We believe this first acquisition demonstrates CropLogic’s ability to execute the company’s international growth strategy.”

Cairns says a common criticism of technology ventures is their questionable ability to convert technology into revenue.

“Our strategy provides us with the opportunity to firstly use our technology to transform and optimise the business model of the acquisition target itself, before then introducing additional services to its clients. It is a two-phase approach that we believe reduces the cost and risk of market entry.”

In a statement released by CropLogic, ProAg’s co-founders Roger McCary and Mike Stephenson say they are looking forward to bringing CropLogic’s innovative technologies to growers in the American Northwest.

CropLogic gathers data via low-powered wireless networks and satellite systems from in-field sensors. Using plant growth modelling originally developed by Plant & Food Research, its software processes the data with proprietary algorithms to provide growers with real-time decision support.

Cairns emphasises the software’s “predictive” power.

“With that plant model it allows us to ascertain what the likely yield impact of decisions being made throughout that growing season, so we can potentially reverse-engineer some problems -- maybe stabilise some yield projections for that particular year.

“And in a limited resource-type environment, perhaps you’ve got restrictions on how much water or nitrogen you are able to apply. We are able to relate that back to that plant model and ensure that the grower is able to apply those resources to the maximum possible yield benefit at the other end.”

CropLogic has mainly worked with potatoes so far but is ready to begin field trials in corn, wheat, soybean and cotton.

Cairns says the purchase was funded from capital; about $3.5 million has been raised from various investors since he joined the company about a year ago. It intends listing on the Australian Stock Exchange in August.

Based at the Plant & Food campus at Lincoln, CropLogic has an agreement to continue to use the CRI for research.

“Our relationship with those guys is extremely positive and I imagine it is only going to be built on over the coming years,” said Cairns.

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