Food Agility CRC SHARING DATA TO BUILD BRAND, MARKETS, JOBS AND EXPORTS Bid Summary 1
EXECUTIVE SUMMARY Empowering Australia s food industry to grow its comparative advantage through digital technologies. Australia has an enormous opportunity as a food producer. Much has been written on this. The issue is not if Australia should pursue this, but how. We have a comparative advantage in agriculture with a reputation for quality and safety, but consumer preferences are rapidly shifting and we face competition from good enough exporters. We will never be a low-cost competitor. Our vision is to empower Australia s food industry to grow its comparative advantage through digital technologies. Faster insights from real-time data and predictive algorithms will help Australian food producers, processors and retailers to more rapidly respond to what the market wants, be more efficient in how they produce and market food, and demonstrate food safety and sustainability to customers. Food Agility CRC brings together almost 50 participants from food, technology and research sectors, guided by agile methods to achieve our vision. We will develop and use digital technologies including models for sharing data across the food value chain so that: Producers can capture value by responding to rapidly changing consumer preferences Exceptional quality and food safety records can drive our brand Environmentally and socially sustainable practices are driven by data Reduce uncertainty to incentivise investment A knowledge workforce drives productivity and higher margins Transdisciplinary research solves business problems Industry accesses social media and consumer preference market insights. 2
Australia has an enormous opportunity to transform the agribusiness industry with technology to be at the centre of Australia s future prosperity. The expected industry outcomes are tremendous. The future of food is digital. The Opportunity: In a world where everything is digitally connected, data is a critical asset. Food is no different yet agriculture has the lowest digital adoption of all industries. Leading Australian universities, companies, research and Government agencies understand this and have united to establish the Food Agility co-operative research centre (CRC) via the Government s CRC program. The centre will assist industry and the Australian economy to take advantage of the massive economic and productivity gains offered by meshing rapidly evolving technologies with the agribusiness sector - to build Australia s brand, markets, jobs and exports. Through an industry-led collaborative process we have identified digital technology as key to optimising food industry outcomes with a focus on four key strategic imperatives that will be the key scope and platform for Food Agility CRC. The four themes are: 1. PRODUCE THE RIGHT THING 2. LEVERAGE BRAND AUSTRALIA Insights into food market demand is a key priority to grow the right products for the right markets at the right time. Market signals can be accessed across a digitally enabled food value chain. Faster insights from real-time data will help Australian food producers, processors and retailers to more rapidly respond to what the market wants. DEMAND DRIVERS Leverag our reputation by demonstrating how safe and sustainable Australian food is while reducing unnecessary costs of compliance and duplication in public and private sectors. Deploy digital technology to reduce structural, geographical and regulatory compliance burdens while opening up new markets. POWERED BY DIGITAL TECHNOLOGY 3. ACCESS TO FINANCE 4. BUILD FUTURE WORKFORCE An ANZ report estimates that by 2050 Australia s food industry could require up to A$1 trillion in additional capital with an estimated A$600 billion to increase production capacity and A$400 billion to manage the change from smaller, family-run farms, to larger more corporatised farms. Data can be leveraged to deliver better access to finance through better management of risk. 3 SUPPLY DRIVERS Australia needs a more productive and competitive agri-food sector, but lacks sufficient people with the right skills to meet demand and exploit market opportunities, both domestic and global. Digital technologies can support the workforce to be more productive, overcoming skill shortages. More talent, equipped with the right skills and capabilities will be attracted to the agrifood sector with the growth in Data Farmers.
A DIGITALLY CONNECTED FOOD WORLD Industry outcomes will include digital solutions and platforms arising from applied research projects which will contribute to higher returns to food producers, greater exports, and more jobs. IP will be created including algorithms from data analytics, software code, sensor hardware and informatics, user interfaces, decision support tools for optimisation. Outcomes will include: More resilient and profitable food & agribusinesses with a particular focus on SMEs that make up 98% of the sector Higher industry margins given lower costs and better responses to market signals Reduction in the cost of compliance with food and safety standards and improved market access Demonstrated provenance and traceability of Australian food through data Greater returns for peri-urban and urban farming with less waste, lower water and energy costs A new range of lower cost competitive financial products /services reflecting lower production and distribution risks Reduction in skill shortages through decision support systems for managers to scale their knowledge reducing costs and facilitating investment A new generation of agribusiness and data science specialists to lead our digital future. The commercial benefits will also be significant. Food Agility CRC partners will provide their data and technology to researchers to accelerate research outcomes and provide rapid pathways to commercialisation and ultimately to full adoption. 4 4
THE VISION Our vision is to empower Australia s food industry to grow its comparative advantage through digital technologies. 5
THE PROPOSED FOOD AGILITY CRC RESEARCH PRO- The CRC will undertake applied projects addressing the four strategic imperatives. Each project will draw on the capabilities of research and industry partners. All projects will have: customer(s) technology partner(s) tailored industry and researcher team and clear agreement on IP and commercialisation. Three research, development and demonstration (RD&D) streams will underpin responses to the four strategic imperatives. Three Research and Development Streams Creating open digital platforms to share data Data Management Sourcing, capturing, storing, exchanging key value chain data to provide rich insights around customer tastes and price points. Food Industry Data Insights via data analytics and machine learning to provide predictions and food value chain optimisation. User-centric design Design led solution creation and technology. User-interface design implementing programs across food value chain. Food Agility CRC will magnify market impact by creating open standard digital platforms and novel approaches to sharing data so that all businesses can make better and faster business decisions. This is key to a digitally enabled and inclusive food value chain that maximises high value food production, processing, delivery and sale at the lowest financial and environmental cost. Technology adoption and return on investment (ROI) will be achieved because: 1. Industry participants determine which projects they participate in to ensure ROI. 2. All projects have a customer, a tailored industry and researcher implementation team, an agreement on IP and a commercialisation pathway. 3. Projects will leverage commercial participant technology/data and our research technology stack. We are focusing on interoperability of platforms and sharing of data rather than a one-size-fits-all approach. Food Agility CRC is committed to open standards and open innovation systems. We favour projects where partners agree to make data and technology available to others and avoid vendor lock-in. The spill over effect will be to create an active ecosystem with greater opportunities for innovators and entrepreneurs to get new products and services to bring to markets. It will also create economic value from the NBN investment particularly for regional Australia. 6
THE FOOD AGILITY CRC PARTNERS PROGRAM Food Agility CRC partners represent the diversity necessary to deliver a market led industry transformation. Our technology and service partners are innovative start-ups that include The Yield, SwarmFarm, HiveXchange and large corporates including Bosch, NAB, Microsoft and KPMG. Food Agility CRC Partners also include food companies across the value chain (with pathways to reach hundreds of SMEs) as well as Research Development Corporations (RDC) and federal and state departments. Food Innovation Australia (FIAL) is also a key participant which will ensure strategic alignment whilst enabling participation by a wide range of SMEs. Food Agility participants have made indicative commitments to invest over $9 million for the first year with a view to invest over a ten year period. Commitments are expected to grow with more companies looking to join during the second stage CRC application. Commitments of up to $90 million over 10 years OUR PARTNERS FOOD VALUE CHAIN COMPANIES (CORPORATIONS, SMEs AND START-UPS) RESEARCHERS GOVERNMENT AND REGULATORS TECHNOLOGY, INFRASTRUCTURE AND SERVICE PROVIDERS 7
FOOD AGILITY'S LEARNING PROGRAM Food Agility's Education and Work Integrated Learning program will integrate data, spatial and social sciences with systems engineering, economics and finance, agricultural, aquaculture and veterinary sciences. University participants will develop a new generation of STEAM-capable, industry-focused business managers, agronomists, data analysts and IT specialists able to support the data-intelligencedriven transformation of the sector. Masters, PhD students and post-doctoral researchers will spend 50 per cent of their time with industry participants actively engaged in the RD&D of technologies and techniques. Current and future farmers, food processors and retailers will be taught data gathering management and analysis, to learn how to respond to market and environmental intel. The Food Agility CRC will also support the Science in Australia Gender Equity (SAGE) initiative to address gender equity in the STEM sector. Forty institutions around Australia are taking part in the SAGE pilot, led by the Australian Academy of Science in partnership with the Australian Academy of Technology and Engineering. TRAINING The training program will be jointly developed by university and industry participants to uplift skills across the food value chain to ensure lessons generated from the CRC are understood and effectively used. Face-to-face and online training platforms will be used. Training will be piloted by our Higher Degree Researchers (HDR), and we will also engage with industry participants and peak bodies, RDCs and other regional and rural training hubs including TAFEs Recognising the rapid pace of innovation in international markets, the Food Agility CRC will engage with leading overseas R&D organisations to ensure best in class training. An understanding of the value of sharing data will be cultivated as part of the knowledge transfer process. GOVERNANCE Our Board and leadership team has a wealth of industry experience to drive the CRC governance Independent Chair, Dr Anne Astin current Chair, ANZ Implementation Sub-committee for Food Regulation and former CEO of Victorian Government s dairy food safety authority. CEO, Dr Mike Briers current Professor of IoT, co-founder of Capital Markets CRC and former CEO of SIRCA, a successful, commercial financial markets data and analytics company with 700 commercial, regulatory and university customers globally. The formal Governance Structure proposed includes: Company limited by guarantee, members are foundation participants. Participants will have board nomination, constitutional voting rights. Board will have nine directors: five independent including the Chair, and four Member elected directors. Initial appointments from one to three years. Sub-committees: Education and Work Integrated Learning, Trans-disciplinary Research; Commercialisation; Audit and Risk; HR and Remuneration. The CRC s operational team will drive agile, lean delivery. Qualified project managers will be drawn from industry/research participants. 8
NEXT STEPS Food Agility submitted the first stage CRC bid on 31 March 2016. We are now preparing for stage two. If successful, the process and timeline is: CRC Agreements successful applicants must execute two agreements: 1. The Commonwealth/Funding Agreement is between the Commonwealth and Food Agility CRC. It records the participants and government commitments of cash and in-kind contributions. 2. The Participants Agreement creates the new CRC and establishes its operating principles. All financially committed Participants (except the Commonwealth) must execute this agreement. Both agreements must be executed before Food Agility CRC can operate. Anticipated 2016 timeline 31 March Aug/Sep Oct/Nov Nov/Dec Stage One applications due Stage Two applications due Interviews Decision on funding 9
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