Connect with us

Top Stories

Ushering In a new Era of Agricultural Lending



Kaseya Takes a Generational Leap in Endpoint and Network Management - Ushering in RMM 2.0

In 1943, Abraham Maslow published a paper in Psychology Review. The document, “A Theory of Human Motivation,” outlined his now famous hierarchy of needs. The list, presented in pyramid form, ranked the various needs and desires of all people, and at the base of the pyramid is our physiological needs: food, water, oxygen, sleep, etc.

Although it’s more than half a century old, Maslow’s hierarchy underscores the importance the agriculture industry. Of all the physiological needs outlined in Maslow’s paper, people are only truly responsible for producing one of them – food.

Indeed, food production is a big deal. According to The Huffington Post, the world consumes more than 11 million pounds of food each minute. You don’t have to be particularly good at math to know that those numbers add up pretty fast. What’s more, estimated population growth means that we will require increased food production in the future. The World Economic Forum estimates that global food production will need to increase by 50% – 100% by 2050.

Alvaro Ramirez

Alvaro Ramirez

To achieve this, we have to better support the independent farms that produce a significant portion of the world’s food. As National Geographic recently noted, “Though small farms tend to lag behind industrial farms in yields, they often deliver more food that actually ends up feeding people.” Moreover, Reuters reports, “More than 500 million family farms manage between 70 and 80 percent of the world’s agricultural land” However, these farmers face pressure on multiple fronts. Industrial farms use their enormous resources to pursue their agendas, land speculators increase the price of farming, and a growing population demands higher levels of food production.

Therefore, independent farmers require strategic support from the financial industry. They have important work to do, and they need access to capital to accomplish these things.

Unfortunately, while the agriculture sector contributes 4.3% of global GDP, it receives less than 3% of credit extended by financial institutions. Farmers desperately require investment improve existing operations, expand their initiatives, and to make their best attempt at producing a profitable and productive yield.

The Financing Disparity

Nobody wants to make a bad bet. Especially in the financial industry, where their success and failure hinges on their ability to make sounds bets, risk is especially intolerable.

To be fair, agriculture can be an unpredictable operation. For example, 2012 saw a striking lack of rain during crops’ critical summer months. As a result, farmers in the U.S. lost $23 billion worth of crops that year. There is so much that farmers can’t control about the final yield, so banks are reticent to extend funding to support their operations. This does not assuage the problem. Instead, it exasperates it.

Perhaps more importantly, the startling view of struggling crops or dwindling fields create a perception problem for the industry. There is a startling lack of data about the agricultural sector, so these impressions have an outsized influence on banks’ lending decisions.

Fortunately, new technologies are ushering in a new era in agricultural lending. Lenders don’t have to rely on perception or intuition. They have access to sound data that allows them to make informed lending decisions, and that’s good for investors and farmers alike.

Better Data. Bigger Funding.

It’s nearly ten-years-old, and the blockchain is transcending its original use-case to serve as a mediator for trusted, transferable data. It was first developed for popular cryptocurrencies like Bitcoin, but now industry leaders from virtually every sector are exploring ways to integrate it into their operations.

For all its compelling features, the blockchain’s ability to store and transfer data is among its most promising. In their 2018 Join Economic Report, members of the U.S. Congress praised the technology and reported, “Blockchain technology essentially stores and transmits data securely, in large volumes, and at high speeds.” There is nothing else like it.

For the agriculture industry, the blockchain can create verifiable data related to crop production, sales, and pricing. Bankers can use this information to determine a farmer’s yield and expansion potential. In this way, farmers can be judged based on their merits and data can drive lending decisions.

Ancillary developments in scanning and tracking technology can provide data points from the time a crop reaches the plow until it reaches the supermarket. This information can help identify and eliminate log jams or value reductions in the production process. Better information allows farmers to increase profitability by generating previously unexplored efficiencies and removing pain-points, which will increase their value and provide significant incentives for bankers to provide funding.

Deloitte, a research and consulting firm with an emphasis on blockchain technology, promotes the blockchain’s capacity to bring transparency to every point of a supply chain. In a 2017 report, Deloitte researchers write, “Blockchain driven innovations in the supply chain will have the potential to deliver tremendous business value by increasing supply chain transparency, reducing risk, and improving efficiency and overall supply chain management.”

The world is relying on independent farmers to produce enough food to sustain its diet habits and growing populations, and these farmers need financial institutions to provide them with working capital. Currently, farmers are not receiving the financing that they need, but that can change. The blockchain and the platforms that use its technology to develop applicable solutions present a tangible way for bankers to make informed lending determinations.

We all rely on the agriculture industry, and data isn’t required to prove that. Meanwhile, valid, transferable, and usable data stored on the blockchain can give lenders the confidence they need to fund the future of food production. Everyone will be better off if they do.

Harvest Hub

Top Stories

Exclusive: Portugal sees green hydrogen output by end-2022, $12 billion in investment lined up



Exclusive: Portugal sees green hydrogen output by end-2022, $12 billion in investment lined up 1

By Sergio Goncalves

LISBON (Reuters) – Portugal will start producing green hydrogen by the end of 2022 and already has private investment worth around 10 billion euros ($12 billion) lined up for eight projects that are expected to move forward, Environment Minister Joao Matos Fernandes said.

He told Reuters in a telephone interview there were also several “pre-contracts for the purchase and assembly of electrolysers” to produce the zero-carbon fuel made by electrolysis out of water using renewable wind and solar energy.

Such hydrogen is more expensive to extract than the heavily polluting conventional method of using heat and chemical reactions to release hydrogen from coal or natural gas, known as brown and grey hydrogen respectively.

Hydrogen is now mostly used in the oil refining industry and to produce ammonia fertilisers, but sectors such as steelmaking, transportation and chemicals are beginning to develop large-scale hydrogen applications to gradually replace fossil fuels as countries try to reduce pollution.

The European Commission has mapped out a plan to scale up green hydrogen projects across polluting sectors to meet a net zero emissions goal by 2050 and become a leader in a market analysts expect to be worth $1.2 trillion by that date.

“By the end of 2022, there will certainly be green hydrogen production in Portugal,” Matos Fernandes said. “Green hydrogen will, over time, allow Portugal to completely change its paradigm and become an energy exporting country.”

He said seven groups had submitted applications under Europe’s IPCEI scheme for common-interest projects to make part of a planned export-oriented “hydrogen cluster” near the port of Sines, from where hydrogen could be shipped to Rotterdam. Total investment there is estimated at some 7 billion euros.

A consortium including Portugal’s main utility EDP, oil company Galp, world’s largest wind turbine maker Vestas, among others, is behind one of the projects.

In Estarreja in north Portugal, local firm Bondalti Chemicals aims to invest 2.4 billion euros in a hydrogen plant.

Altogether, these envisage an installed capacity of over 1,000 megawatts (MW).

Matos Fernandes said Portugal was also negotiating with Spain the construction of a pipeline for renewable gases, including hydrogen, from Sines to France, crossing Spain.


Spain and Portugal also want to develop an ambitious cross-border lithium project taking advantage of the geographical proximity of their lithium deposits and aiming to cover the entire value chain from mining to refining, cell and battery manufacturing to battery recycling, he said.

Portugal is already a large producer of low-grade lithium mainly for the ceramics industry, but is preparing to make higher-grade metal used in electric car batteries.

A much-awaited licensing tender for lithium-bearing areas that has been delayed by the COVID-19 pandemic should take place by the year-end, Matos Fernandes said.

He promised the tender would address environmental concerns by local communities and there would be no lithium mining “at any cost”.

The minister also said Portugal would use its six-month presidency of the Council of the European Union to finalise a landmark law that would make the bloc’s climate targets irreversible and speed up emissions cuts this decade, expecting it to be approved in the first half of 2021.

(Reporting by Sergio Goncalves; Editing by Andrei Khalip and David Evans)


Continue Reading

Top Stories

Under fire in EU, AstraZeneca CEO says ‘hopefully’ will meet vaccine supply goals



Under fire in EU, AstraZeneca CEO says 'hopefully' will meet vaccine supply goals 2

BRUSSELS (Reuters) – AstraZeneca boss Pascal Soriot said on Thursday he hoped to meet the European Union’s expectations on the number of COVID-19 vaccines the company can deliver to the bloc in the second quarter, after big cuts in the first three months of the year.

The Anglo-Swedish drugmaker has been under fire in the EU for its delayed supplies of shots to the 27-nation bloc, which ordered 300 million doses by the end of June.

“We are working 24/7 to improve delivery and hopefully catch up to the expectations for Q2,” Soriot told EU lawmakers in a public hearing.

Under its contract with the EU, the company has committed to delivering 180 million doses in the second quarter.

Soriot did not mention the 180 million target, but said he was confident the company will be able to increase production in the second quarter using factories outside the EU that had no production problems, including in the United States.

He confirmed the company was trying to get 40 million doses of the COVID-19 vaccine to the EU by the end of March, which is less than half the amount it promised for the quarter in its contract.

The EU, which has fallen far behind the United States and former member Britain in vaccinating its public, has repeatedly urged the firm to deliver more.

Lower-than-expected yields – the amount of vaccine that can be produced from base ingredients – at its factories hurt output in the first three months.

Asked about supplies to Britain, which relies on the same factories used by the EU, Soriot said the former EU member with a population of around 66 million was smaller, and noted that most doses produced in the EU were used to serve the EU which has a population of about 450 million.

Executives from rival drugmakers that have developed or are testing COVID-19 vaccines, including Moderna Inc and CureVac NV were also part of the panel.

But most questions were directed at Soriot amid anger that the company has failed to deliver promised vaccine quantities to the bloc on schedule.

Moderna Chief Executive Officer Stephane Bancel said the company has experienced fluctuations as the U.S. biotech group ramps up output of its COVID-19 vaccine.

He said usually a company would stockpile product ahead of a launch, but it is shipping every dose it makes, leaving it without any spare inventory.

His comments came a day after the company increased its output target for this year and 2022 as it invests in additional manufacturing capacity.

(Reporting by Josephine Mason in London and Francesco Guarascio in Brussels; Editing by Susan Fenton, Bill Berkrot and Keith Weir)


Continue Reading

Top Stories

Shift to sun, ski and suburbs gives Airbnb advantage over hotels



Shift to sun, ski and suburbs gives Airbnb advantage over hotels 3

By Ankit Ajmera

(Reuters) – Airbnb’s quarterly results are likely to show the pandemic may have helped the home rental company lure leisure travelers away from big hotels during the global travel collapse of 2020.

Weary of being locked up in their homes for months, travelers hit the road and booked homes and cottages on Airbnb, while avoiding flights and downtown hotels, analysts said.

Airbnb accounted for 18% of the total U.S. lodging revenue in 2020, up from 11.5% in 2019, data from hotel analytics provider STR and vacation rental data company AirDNA showed.

It outperformed the hotel industry and online travel agents such as Expedia and thanks to its greater offer of ‘sun, ski, and suburban’ rental homes, Cowen & Co analysts said.

Shift to sun, ski and suburbs gives Airbnb advantage over hotels 4

(Graphic: Airbnb grabs bigger share of U.S. lodging market in pandemic:

For an interactive graphic, click here:


In 2019, about 90% of Airbnb’s bookings came from leisure travels compared with about 20%-30% for large hotels chains, including Marriott and Hilton, that rely on business travel to grow their profits.

“Unfortunately, the hotel operators do not have as much supply in locations where people are willing to travel,” said Jamie Lane, vice president of research at AirDNA.

Lane said with mass vaccinations later in the year, the share of alternative accommodations including Airbnb will drop before continuing to grow at 2%-3% per year once normal travel patterns return.

Shift to sun, ski and suburbs gives Airbnb advantage over hotels 5

(Graphic: Airbnb U.S. sales against top hotels:

For an interactive graphic, click here:


* The San Francisco-based company is expected to report gross bookings of $23.10 billion in 2020, down from about $38 billion a year earlier, according to the mean estimate of 12 analysts according to Refinitiv; gross bookings are seen rising by 50% in 2021.

* Analysts’ mean estimate for Airbnb’s full-year net loss is $3.52 billion, bigger than a loss of $674.3 million a year earlier. Full-year revenue is expected to drop 32% to $3.27 billion.


* Of 34 brokerages, 20 rate Airbnb’s stock “hold”, 12 “buy” or higher and two “sell” or lower

* Wall Street’s median 12-month price target for Airbnb is $156​, about 22% below its last closing price of $200.20.

* The company’s stock has nearly tripled since listing in December

Shift to sun, ski and suburbs gives Airbnb advantage over hotels 6

(Graphic: Airbnb’s stock has nearly tripled since debut:

For an interactive graphic, click here:

(Reporting by Ankit Ajmera in Bengaluru; Editing by Sweta Singh and Saumyadeb Chakrabarty)

Continue Reading
Editorial & Advertiser disclosureOur website provides you with information, news, press releases, Opinion and advertorials on various financial products and services. This is not to be considered as financial advice and should be considered only for information purposes. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third party websites, affiliate sales networks, and may link to our advertising partners websites. Though we are tied up with various advertising and affiliate networks, this does not affect our analysis or opinion. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you, or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish sponsored articles or links, you may consider all articles or links hosted on our site as a partner endorsed link.

Call For Entries

Global Banking and Finance Review Awards Nominations 2021
2021 Awards now open. Click Here to Nominate

Latest Articles

Newsletters with Secrets & Analysis. Subscribe Now