Digital Agriculture

October 2023

1. Context
Changing climate conditions and increasing weather variability increase farmers’ need
for accurate and timely scientific information to plan their agricultural investments.
Climate change will increase flooding, heat waves, pests and extreme weather events, making
improved forecasts a necessary input to adaptation decisions (Wang et al. 2021; Aufhammer
and Carleton 2018, IPPC Secretariat 2021). Farmers will need to use new seeds, crops, and
technologies to adapt to climate change.

Most smallholder farmers lack access to science-based agricultural advice. Although

governments collectively employ a large number of extension workers in low- and
middle-income countries, the ratio of farmers to extension workers exceeds 1000 to 1 in many
countries. Many extension programs also face challenges with inadequate management, and
accountability of extension workers (Fabregas et al. 2019). Information shared by extension
services is often misaligned with farmers' incentives or does not fully consider their realities
(J-PAL 2023). For example, according to a 2017 survey conducted in India, 6% of farmers
reported receiving advice from an extension agent within the past year, and 70% of farmers
expressed distrust in the recommendations provided by extension workers (Cole and Sharma
2017).

2. Digital Agriculture
Digital agriculture includes phone-based advisory services for farmers and a range of
services to link farmers with input providers, extension workers, and markets. Digital
agriculture services can deliver relevant information to smallholder farmers in a timely,
cost-effective, and scalable manner (Fabregas et al. 2023). Communication tools such as phone
calls, SMS messages and videos have become prevalent and effective medium for delivering
technical information in an easily understandable manner, and have the ability to respond
immediately to farmers’ concerns and rapidly push new information to farmers.

The wide availability of smartphones offers opportunities to provide additional digital

agriculture services at lower costs. Digital connectivity and smartphones are widespread in
low- and middle-income countries and are becoming more so (Silver et al. 2019, Silver 2019).
For example, in India, around three-quarters of rural households with children aged 3-16 own a
smartphone (ASER 2022). Smartphones allow for multimedia content, which enables sharing

1
videos demonstrating crop and livestock management techniques and sending real-time images
of pests for diagnosis.

Digital agriculture allows the customization of information to farmers’ specific needs

across contexts. Digital agriculture systems can transmit region-specific information on
weather forecasts, pest outbreaks, soil health, market prices and agronomic practices that
farmers can use to increase productivity and adapt to climate change.

Subscription models, where farmers pay a fee to access digital agricultural information,
have had limited reach, creating a role for governments to provide this information.
Numerous institutions have launched digital agricultural programs that rely on
subscription-based financial models for individual farmers. However, these systems haven’t
been able to reach a large share of farmers in low- and middle-income countries. On the
farmer's side, it is not possible to assess the reliability and quality of information provided, so
their willingness to pay is low. From the firm’s perspective, the payments made by farmers might
not be adequate to cover the fixed costs of providing information due to difficulties preventing
non-subscribers from accessing the information. Thus, significant disparities exist between the
prices farmers are willing to pay for information and its societal value (Fabregas et al. 2019).
This is especially true in the case of weather forecasts, as weather information is a subject of
extensive public discussion, resulting in its wide dissemination. A more scalable approach could
involve governments offering digital agricultural extension services to farmers at no cost.

3. Impact and Cost-effectiveness

Digital agricultural services disseminate information to farmers by phone and can
cost-effectively influence farmers’ decisions. The impacts of even basic SMS advisory
messages are modest but highly cost-effective, and the improvement of digital dissemination
systems over time could generate increasingly larger benefits.

Multiple studies find that farmers adjust their behavior and investment decisions in
response to accurate forecasts. In Telangana, India, farmers who were randomly assigned to
receive digitally-distributed forecasts substantially altered their planting and investment
decisions to better align with the forecasted seasonal timing, with farmers who previously
expected a shorter season than was eventually forecasted, increasing their land under
cultivation, adding new crops, and investing more in all pre-harvest expenditures by 34% (Burlig
et al. 2022). In Ghana, farmers in communities that received forecasts via SMS altered their
planting and investment behavior, including farmers who received forecasts directly and those
who did not (Fosu et al. 2018).

Digitally delivering weather forecast information to farmers could generate very large
returns. In India, bringing forecasts of total monsoon rainfall for each state up to the average
accuracy for the nation is estimated to exceed USD 3 billion over five years (Rosenzweig and
Udry 2019). Similarly striking benefits are estimated for day-ahead forecasts in Benin. When
farmers received SMS messages with forecasts generated by averaging forecasts from three
different providers, a randomized evaluation estimated gross benefits of USD 98-336 per farmer,
per year (Yegbemey et al. 2023). A randomized trial of disseminating weather forecasts and

2
price information by SMS in Colombia found labor savings of USD 40-142 per farmer per year,
although this result is imprecisely estimated (Camacho and Conover 2019).

Digital agriculture can encourage behavior change and increase the adoption of
recommended practices. In Gujarat, India, an automated voice message platform increased
the adoption of recommended practices for seeds and pesticides by 6 percentage points among
cotton farmers (Cole and Fernando 2021). In Ecuador, a post-training text message for potato
farmers increased the adoption of Integrated Pest Management practices by 7.2 percentage
points (Larochelle et al. 2017).

Farmers respond to soil chemistry information disseminated through digital agriculture.

Soil acidity is prevalent in East Africa and it reduces crop yields and quality. Soil acidity can be
tackled with the application of agricultural lime, but its adoption remains relatively low. A review
of six randomized controlled trials with the Kenya Agricultural and Livestock Research
Organization (KALRO), a Kenyan State Corporation, One Acre Fund, Innovations for Poverty
Action, and Precision Development in Kenya and Rwanda found that farmers who received
mobile phone-based advice were 22 percent more likely to adopt agricultural lime for acidic soils
and to use appropriate levels of fertilizer from a low base of two percentage points (Fabregas et
al. 2019). The program’s estimated benefits exceeded marginal costs by 9 to 1 (Fabregas et al.
2022).

Digital agriculture could aid farmers in understanding soil health card recommendations,
which rely on soil chemistry and could help reduce the overuse of nitrogen fertilizer and
mitigate emissions. Nitrogen fertilizer overuse is common in some parts of the world, which not
only contributes to greenhouse gas emissions but also reduces farmers’ profits (Ritche 2021). It
also imposes fiscal costs on governments that subsidize fertilizer, and damages the local
environment through fertilizer runoff (Ritchie 2021). Soil health cards aim to provide accurate
soil information and fertilizer recommendations so that farmers can make informed decisions on
fertilizer application tailored to the specific requirements of the soil and crop. Given that nitrogen
fertilizer is often overused, soil health cards could help reduce excessive nitrogen fertilizer
usage. However, few farmers could understand the initial versions of these cards, but digital
agriculture can improve comprehension of SHC. In Gujarat, India, researchers conducted A/B
testing of a simplified SHC designed using HCD principles, and complemented these SHCs with
digital messages (Cole and Sharma 2017). These changes had a dramatic impact. While
baseline comprehension was 6 percent, including audio improved the understanding of soil
health cards recommendations by 37 percentage points. Adding video increased understanding
by 41 percentage points (compared to a baseline comprehension rate of 5.9 percent among
farmers that received only the SHC). This was equivalent to the impact of having an in-person
discussion with an agronomist, but much less costly (Cole and Sharma 2017). Using digital
agriculture for SHCs allows the re-transmission of information to farmers at relevant times in the
agricultural calendar and in subsequent years. Governments are open to redesigning SHCs
and using digital ag to improve comprehension. The Government of India has experimented
with different versions of redesigned soil health cards. The Government of Pakistan redesigned
soil health cards in 2018 and included voice recommendations based on evidence (PxD 2017).
However, it is important to test the effectiveness of digital agriculture for SHCs in different

3
contexts: an IDinsight study in Chhattisgarh and Uttar Pradesh, India, used a different research
design found no significant impact on SHC comprehension from automated voice calls and text
messages (IDinsight 2021). The delivery of SHCs is likely to be cost-effective because the costs
of disseminating information through digital agriculture are extremely low. One important
constraint is that soil chemistry information and fertilizer recommendations in soil health cards
are often not well-correlated with nutrient levels observed in third-party testing. Key steps to
maximize the effectiveness of digital agriculture for soil health cards would be to incorporate
better procedures for sampling and sample collection, conduct third-party audits of a sample of
soil chemistry tests, and use information based on spectroscopy.

4. Potential for Further Improvement

Weather forecasts can be the entry point for digital agriculture, and digital agricultural
services can be expanded over time to provide information on a broader set of topics and
services. Weather forecast dissemination can be the entry point for digital agriculture at scale
because the expected benefits for farmers are large, and there is a strong demand from
governments and farmers. Other topics could be later included in the service, such as
weather-based agronomic advice, soil chemistry or pest and disease management. Digital tools
can also be used to improve in-person agricultural extension by allowing extension agents to
communicate with farmers more efficiently and increasing the number of farmers they can
reach. Similarly, software can be used as a management tool to improve extension worker
performance. Digital tools could also create opportunities for farmer-to-farmer communication
beyond existing networks, as well as enable two-way feedback between farmers, governments,
service providers, and agricultural researchers. Realizing this potential will require substantial
development and testing of new services. Beyond digital advisory, digital agriculture could
enable a host of other services, including directories that link farmers to input suppliers,
services that facilitate efficient sharing of agricultural equipment, and services that connect
buyers and sellers of agricultural commodities, potentially reducing price volatility in response to
weather and other shocks (Daum et al. 2021; Dillon et al. 2022; Bergquist, McIntosh, and Startz
2023).

Tools like human-centered design, machine learning and artificial intelligence can
maximize the impact of digital agricultural services and ensure that the content is aligned
with farmers’ needs. Potential ways to refine digital agriculture include using human-centered
design for continuous feedback, iteration, machine learning (ML), and artificial intelligence (AI)
for improved personalization. Human-centered design could help ensure that advisory content is
relevant to farmers and could provide tools for examining the impact of providing information.
A/B testing allows for rapid iteration and data-based decisions to improve the program's design.
ML and AI could personalize information delivery based on farmers' characteristics and
preferences, enhancing the relevance of advice. For example, an experiment with a digital
advisory service in India found that personalizing service timing based on farmers'
characteristics and past engagement led to a 2.6 percentage point rise in farmers' engagement,
an 8 percent increase over the baseline pickup rate of 31 percent (Athey et al. 2023).

4
5. Potential for Scale
Digital agriculture by governments offers tremendous potential for scale. Even in
low-income countries, the vast majority of farm households have access to a feature phone.
Smartphones are widespread in middle-income countries and are increasingly common in
lower-income countries. The public sector has historically supported agricultural extension
programs, and digital extension offers an opportunity for governments to expand their reach at a
low-cost . Such government programs have reached large numbers of farmers in multiple
countries, including Bangladesh, Ghana, Kenya, Ethiopia, India, Pakistan, and the Philippines
(Saleheen 2020; Esoko; Mucoki et al. 2022; Berhane et al. 2018; Rajkhowa and Qaim 2021;
Directorate General Agriculture; Department of Agriculture). Since rural cell phone towers are
typically underused, the resource costs of digital communication are low, and governments can
negotiate with telecommunication firms to disseminate agricultural information as a public
service or offer lower rates for these services.

Technical collaborations between governments and experts on content design and

dissemination produce global public goods with high social returns. Governments may
seek technical assistance for strengthening service delivery of digital agriculture, in particular
engaging experts on content design and improved methods of dissemination to maximize
effectiveness. Such collaborations generate global public goods, as they develop knowledge
that can be used across countries. Donor support for such collaborations between governments
and technical experts would generate large social returns.

Multiple governments have demonstrated an openness to incorporating technical advice

to develop new digital advisory systems or improve existing ones. For example, the
government of Ethiopia significantly enhanced the performance of its digital advisory service by
implementing improvements informed by focus groups, funnel analysis of existing data, and A/B
testing conducted with the support of external agencies. Just one of the changes alone led to a
10-18 percent increase in listening rates (duration) of agricultural advice (Walter et al. 2020). A
program in Odisha, India, illustrates a potential path to scale: an NGO worked with the
government to design a digital advisory system that the government later took over and
expanded with public funds (Ama Krushi). The program now reaches over 6 million farmers.

A combination of donor and government funding can help to initiate the rollout of digital
agriculture services. Even though the marginal cost of digital agriculture services is quite low,
the set up costs of these services are much higher. Therefore, donor funding would often be
necessary to kick-start these services. The climate mitigation benefits of digital agriculture are a
global public good that donors could support . Governments in middle- income countries could
initially cover only the marginal costs of operating the platform, such as telecommunication
costs, and assume financial responsibility only once the services are established. In
low-income countries, donor funding could support the implementation of digital agriculture in
the long term.

5
6. Potential Path Forward
The dissemination of weather information at scale through digital agriculture could start
in India, where there is a strong commitment from the government. The Ministry of
Agriculture and Farmers' Welfare (MoA&FW) in India is committed to reaching 100 million
farmers with weather information and potentially associated agronomic advice disseminated
through digital agriculture and is willing to cover the telecommunication costs. Highly accurate
monsoon onset forecasts can be obtained for some regions of the country. Given that a
significant portion of India's population heavily depends on the Asian Monsoon, providing
weather information through digital agriculture could bring substantial benefits to Indian farmers.

The funding required to provide technical assistance for disseminating weather forecasts
to 100 million farmers in India is approximately USD 5.3 million. The government intends to
cover the telecommunication costs of disseminating weather information through SMS
messages (~9.2M) and funders could cover the costs of technical assistance (of approximately
~5.3M) over the first five years of implementation. These are rough estimates and can be
refined upon request. The costs associated with dissemination change significantly depending
on the combination of dissemination channels and the annual volume of messages. This budget
includes funding to i) identify the regions and times of the year where forecasts produced by
IMD are accurate, ii) identify providers of improved forecasts accurate and relevant for
agriculture decision-making, iii) establish a team to support the government with an updated
dissemination strategy, including scoping for customization opportunities with existing
government datasets, conducting A/B testing, and monitoring to enable rapid program iterations,
and iv) implement field activities to understand farmers' needs and test forecasts with farmers to
identify the most effective approach for conveying weather information to farmers. This budget
does not include the costs of procuring weather forecasts from international providers. The
Innovation Commission for Climate Change, Food Security, and Agriculture has prepared a
complementary note that focuses on weather forecasting. Weather forecasts are global public
goods and the Commission recommends that donors procure these forecasts and make them
available to governments.

The program in India could be implemented gradually, expanding its farmer reach and
geographical and content coverage over time. During this initial phase, the service could
target a region and broaden its reach to encompass additional geographic areas and
agricultural topics as it demonstrates its effectiveness. To reduce risk, the implementation
approach could incorporate feedback loops, monitoring, A/B testing, and evaluations. Success
could be measured using administrative data and surveys with a small sample of farmers that
collect information on engagement with the service, trust, understanding of the weather
information, and changes to practices.

Kenya presents another promising opportunity for the expansion of digital agriculture.
Small-scale agriculture in Kenya is mostly rain-fed, making farmers vulnerable to the impacts of
weather variability and climate change (Ogutu 2023). Recent efforts have improved the
accuracy of long rain forecasts (Miller et al. 2021, MacLeod 2018). With a rapidly growing
mobile phone penetration rate, Kenya's farmers are increasingly able to receive real-time

6
weather updates (Wabwire 2020). Moreover, the Kenyan government has shown interest in
leveraging technology for agricultural advancement, with several initiatives already in place to
support farmers (Mgendi 2019, Obiero et al. 2019).

Disseminating weather forecast information to 170 million farmers could be facilitated

through digital agriculture services. Given substantial evidence supporting the potential
impact of digital agriculture and the large demand for weather information, the implementation of
digital agriculture could use weather as a starting point. These services could be deployed in
low and lower-middle income countries which depend on a rainy season for most of their annual
rainfall. Farmers in regions affected by the Asian Monsoon, such as Bangladesh, India,
Pakistan, as well as farmers in regions affected by the long rains in East Africa, including
Ethiopia, Kenya, Tanzania, and Uganda, could benefit significantly with these innovations. More
scoping work is needed to confirm if accurate forecasts for the main rainy season are available
or can be procured for each geography. The list of countries provided is not exhaustive, and the
Innovation Commission can include budgets for other countries upon request, particularly those
where significant benefits for farmers are anticipated.

Reaching 50% of farmers in seven countries which depend on a rainy season for most of
their annual rainfall would cost an estimated $50 million. Additionally, the per-message
costs could be reduced by negotiating a large-scale contract with the government.

7
Table 1. Estimated technical assistance costs

Technical assistance costs (Million USD)

Technical assistance costs (Million USD)

Year 1 Year 2 Year 3 Year 4 Year 5 Total

Ethiopia $1.1 $1.3 $1.4 $1.7 $1.9 $7.4

Tanzania $1.3 $1.5 $1.6 $1.9 $2.2 $8.5

Kenya $1.1 $1.2 $1.3 $1.5 $1.8 $6.9

Uganda $1.0 $1.1 $1.3 $1.5 $1.8 $6.7

India $0.8 $0.9 $1.0 $1.2 $1.4 $5.3

Pakistan $1.0 $1.1 $1.2 $1.4 $1.6 $6.4

Bangladesh $1.0 $1.2 $1.3 $1.5 $1.7 $6.6

Total $7.6 $8.6 $9.6 $11.1 $12.7 $49.6

Table 2. Estimated telecommunication costs for SMS messages

8
Telecommunication costs

Target Cost per Telecommunication costs (Million USD)

reach SMS
(Million message
farmers) (USD) Year 1 Year 2 Year 3 Year 4 Year 5 Total

Lower
bound 20% 40% 60% 80% 100%

Ethiopia 18.2 0.0300 $1.6 $3.3 $4.9 $6.6 $8.2 $24.6

Tanzania 9.6 0.0158 $0.5 $0.9 $1.4 $1.8 $2.3 $6.8

Kenya 3.9 0.0115 $0.1 $0.3 $0.4 $0.5 $0.7 $2.0

Uganda 5.5 0.0086 $0.1 $0.3 $0.4 $0.6 $0.7 $2.1

India 107.6 0.0019 $0.6 $1.2 $1.8 $2.5 $3.1 $9.2

Pakistan 13.8 0.0196 $0.8 $1.6 $2.4 $3.3 $4.1 $12.2

Bangladesh 13.1 0.0141 $0.6 $1.1 $1.7 $2.2 $2.8 $8.3

Total 171.7 0.2272 $4.4 $8.7 $13.1 $17.4 $21.8 $65.3