eCommerce Is Transforming Agriculture

eCommerce, agriculture

Farmers in the U.S. are increasingly turning to eCommerce to procure essential items, moving away from physical stores and regional farming cooperatives.

While internet adoption has historically been slow among America’s farmers for making agricultural purchases, current economic and market pressures have pushed them online for better deals, according to The Wall Street Journal.

A strong U.S. dollar has led the nation’s agricultural exports to decline some $1 billion in 2016. Imports, on the other hand, increased by an estimated $7 billion. The resulting commodity glut in the U.S. has put pressure on crop and other food prices, pushing farm incomes to an eight-year low, said the WSJ.

Overall, 2016 was a down year for food prices as the domestic supply greatly increased. Looking at specific retail food categories, prices declined 21.1 percent for eggs, 6.3 percent for beef and veal, 4.1 percent for pork, and 2.3 percent for dairy and related products. As a result, farmers have turned to the internet to find better deals on the goods they need to facilitate production.

The change comes at a time when broadband internet access is reaching more rural areas of the U.S. In 2007, only about one-third of people living in rural areas had access to broadband internet versus almost half of urban populations, according to the Pew Research Center.

But according to the numbers as of last November, broadband internet had reached some 63 percent of rural residents in the U.S., compared to 73 percent of people in cities.

The Farmer Business Network (FBN), an online farming supply merchant startup backed by Google Ventures, reportedly launched a service last year that enables farmers to monitor nationwide supply prices. Weed killers, for example, can cost up to four times as much in one part of the country as in another, according to FBN.

The FBN can often deliver products that farmers order straight to their door. FBN has nine warehouses in eight states. The company uses trucking companies such as FedEx Freight, said the WSJ, which can deliver chemicals in quantities up to 44,000 pounds.