By Karl Plume
St. Louis, Missouri (Reuters) - Agricultural seeds and chemicals maker Bayer AG (ETR:BAYGN) on Monday launched a digital farming platform that it says will help U.S. growers enact environmentally friendly practices and connect them with companies seeking more sustainable food, feed and biofuel ingredients.
The effort will help the seed and chemical giant diversify its revenue stream, capitalizing on a decade-long farm data collection effort.
Bayer (OTC:BAYRY)'s ForGround platform will tap weather, soil, seed and farming practice data to make recommendations about how growers can boost soil health, cut emissions and reduce water use and chemical applications. Environmental outcomes would then be certified by a third-party verifier so that farmers can potentially sell their grain for a premium, Bayer said.
The program would also allow companies such as food makers and biofuel producers to create incentive programs for farmers to grow crops in a way that would help companies meet their environmental goals.
Bayer will charge companies a flat or per-acre fee for the services, and make money from farmers through seed and chemical sales and data-platform subscriptions. The launch initially targets U.S. agriculture but the company envisions broadening it to other countries, though no timetable is set yet, Bayer said.
The offering builds on Bayer's Carbon Program which pays farms for pulling climate-warming carbon from the atmosphere and locking it in the soil.
It is among the latest initiatives by agriculture companies aiming to meet rising demand for sustainably produced food, and to profit off data collection through subscriptions for new technology.
"This is a challenge and a key benefit for agriculture. But it's also a challenge and a benefit for companies that have made sustainability commitments around the world," said Leo Bastos, head of global commercial ecosystems at Bayer CropScience.
The program taps Bayer's strategy to use deep pools of agricultural and climate data to make farming more efficient and to verify and monetize environmental benefits.
ForGround requires that farmers enroll in Bayer's Climate FieldView platform, where growers log data about agricultural practices such as no-till farming or planting cover crops.