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Democratising technology for farmers

By Niranjan Mudholkar,

Added 27 September 2019

The new wave of productivity will come out of data, analytics and new age technologies around digitization, says Rajesh Jejurikar - President, Farm Equipment Sectors, Mahindra & Mahindra Ltd.

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The company is working on introducing a range of farm machinery, with the idea of taking technologies used in large land holding farms around the world and making them affordable and accessible to small land holding farmers, says Rajesh Jejurikar - President, Farm Equipment Sectors, Mahindra & Mahindra Ltd.

Where does the Farm Equipment Sector (FES) stand within the Mahindra Group in terms of revenues and strategic importance?
The Farm Equipment Sector (FES) forms an integral part of the Mahindra Group. At FES, we aim to deliver Farm Tech prosperity through pioneering technologies for farmers across the world to enable them to Rise. With a presence in over 40 countries, Mahindra is the world’s largest farm tractor manufacturer by volumes and is India’s leading tractor manufacturer for over three decades. The company achieved a manufacturing milestone of over 3 million tractors (since inception) in FY19. During the year, FES sold 3,30,436 tractor units in both the domestic and export markets, with a revenue contribution of approximately US$3.2 billion or about Rs.22,000 crore to M&M Group’s overall revenues.
FES has a strong tractor portfolio and is building technology skillsets beyond it. The company is working on introducing a range of farm machinery, with the idea of taking technologies used in large land holding farms around the world and making them affordable and accessible to small land holding farmers. A step in this direction are alliances and acquisitions in Agri start-ups in the last few years.

It’s been about two years since M&M unveiled Farming 3.0. How has it evolved since then and how has it helped you better serve the farmers?
When we consider the global demand for food 20-30 years from now, we realise that food production needs to go up by around 70 percent. With most of the arable land already under cultivation there is limited land to work with. Hence productivity will need to drive the food needs of people, and we believe that we have a significant role to play in enabling that productivity. That new wave of productivity will come out of data, analytics and new age technologies around digitisation.
When we started thinking about Farming 3.0, we were building a strategy to not just sell tractors and farm machinery, but to sell a solution, which helps our customers achieve an outcome. It is about traversing our business from being a manufacturing company, to one that will help the customer achieve outcomes, through improvement in yield and productivity.
Farming 3.0 has multiple legs of how we will use technology. It comes from the vision of democratising technology for farmers with small land-holdings. There are many new technologies that are deployed on large farms around the world, and our idea is to make those new technologies affordable for and accessible to small landholding farmers, to help them achieve a better output.
In line with our Farming 3.0 strategy, we have recently invested in start-ups like Resson Aerospace Corporation of Canada and more recently in a Switzerland- based agricultural-technology company Gamaya SA. Both start-ups will enable us to support the company’s business by developing technology solutions, with the idea of making a difference in the way farming is done.

How are things doing on the exports front?
Global Farm Machinery makes up about 30 percent of the total revenue for Mahindra FES. We have an on-ground presence in North America, Brazil, Mexico, Finland, Turkey and Japan through our subsidiaries. Going forward we will continue to explore newer markets for our products and consolidate our presence in existing ones, introducing newer products including upgrades, while building our sales and service network.

Which tractors are selling more in the recent times for Mahindra and the overall industry in India – lower or higher horsepower? Do you see the trend to continue?
While demand for tractors in the 30-50HP makes up over 80 percent of tractor sales, over the last few years we have witnessed demand in the sub-30HP segment due to factors like niche applications like horticulture-based farming, which is becoming popular. Horticulture production now exceeds food grain production in India. This has created exciting mechanisation opportunities. Our new tractor Jivo, is a tractor in the less than 30HP segment which is enabling growth in this segment.

In the last few years, Mahindra has also made some important acquisitions in Japan (Mitsubishi Agricultural Machinery), Finland (Sampo Rosenlew) and Turkey (Hisarlar). Tell us about Mahindra FES’s Farm Machinery play and how have these acquisitions helped the FES so far?
The total global Agri equipment market is roughly about US$160 billion, of which Farm Machinery makes up US$100 billion and tractors US$60 billion. We have a big opportunity in the Farm Machinery space and India is still a small market with a huge upside potential. At Mahindra, we have a complete range of products and solutions as part of our Farm Machinery portfolio. This is based on having established three global technology Centers of Excellence, through acquisitions we made over the last couple of years. These centres will allow us to bring back and adapt technologies relevant for the Indian market.

Mahindra & Mahindra acquired a 11.25 per cent stake in a Swiss company called Gamaya. How do you plan to leverage on this acquisition?
With agriculture increasingly becoming technology intensive, we at Mahindra are investing in future ready technologies to provide complete solutions to the global farming community. Our latest acquisition of Gamaya, will enable us to develop and deploy next-generation farming capabilities, such as precision agriculture and digital farming technologies, giving us access to hyperspectral imagery analytics, artificial intelligence and machine learning, which captures and interprets useful information on the state of crops for the farmers. With this partnership, we expect to set new benchmarks in farming and its related services.

How happy are you with the overall product portfolio of FES at present and how do you see it evolving in the next three years?
At FES, we have one of the most comprehensive tractor portfolios in the industry. We have introduced products on Mahindra’s next-generation tractor platforms – the Novo, Yuvo and Jivo. We have also introduced new product offerings from Swaraj. In addition to a strong tractor portfolio, we now have a full range of Farm Machinery solutions. As the Indian consumer is evolving and as we grow our tractor business, there is a greater need for implements and differentiated farm machinery. Horticulture is a big area of growth. We believe that this is an opportunity for us to leverage in the domestic market.

Tell us about the overall production footprint of FES.
FES has Manufacturing and CKD assembly in 8 countries – India, USA, Brazil, Finland, Turkey, Algeria, Australia and Japan. In India, we have a manufacturing presence in Kandivali (Mumbai), Nagpur, Rudrapur, Jaipur, Zaheerabad and Mohali (Swaraj). At Mahindra, we have embarked on a Digital Transformation Journey for manufacturing around two years ago. The Manufacturing Value Chain (Supply Chain & Manufacturing Processes) is Digitised and created for all processes, for Data Driven Decision Making through Self Service Analytics. The company is working on introducing a range of farm machinery, with the idea of taking technologies used in large land holding farms around the world and making them affordable and accessible to small land holding farmers.
END

During the year, FES sold 3,30,436 tractor units in both the domestic and export markets, with a revenue contribution of approximately US$3.2 billion or about Rs.22,000 crore to M&M Group’s overall revenues.

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