Farm Advisory Service as a business partner:

a new integrated approach based on Progis

solutions

eFarmer Central European Conference , Budapest, 31 January-1 February 2007

• Current state of FAS

• Technology intensive FAS

• The issue of data ownership

• Business opportunities with FAS

• Partners 1: Agro-Insurance

• Partners 2: Agro-Banks

• Partners 3: Commodity Sellers

• Other beneficiaries

• Cooperation within AGROffice

• PROGIS business offers

• Conclusions

Outline

• Several Strategies

for financing FAS

Current State of FAS

Realization

Public Private

Funding

PublicA – Free state advice service

B – Additional advice service (contracts, voucher schemes)

PrivateC – Cost recovery by state advice service

D – Private advice service

Source: Povellato and Scorzelli, 2006. The Farm Advisory System: A Challenge for the Implementation of Cross Compliance. INEA.

• FAS must be

operational by

January 1st 2007

at the latest (Regulation 1782/2003);

• The participation of farmers is voluntary;

• In 2010 the advisory system may become compulsory (Art. 16);

• Support granted to farmers to use FAS (max. 80 % or up to EUR 1,500 per advisory service (Art. 21);

• Support granted to cover the costs for setting up FAS, both for organisations and farmers (Regulation 1698/2005).

• Documentation is produced with one single input and for different sources;

• Reduction of reporting work, subsidy management automatized;

• Better management due to planning tools;

• A link to the agro-technological database;

• Optimisation of whole production process (e.g. fertilizer and chemicals use, machinery use etc.);

• Better business calculation, easy variants calculation

• Easy production of business plans and access to credits;

• For FAS agent:– Face-to-face communication with a farmer (due to time saving)

– Better access to and sharing of information

Technology intensive FAS

• Farmers – first hand and most reliable information,

– not so open to share their information,

– when are urged to provide information this might be not so close to the reality.

• Trust Centers– collect the information from each single farm,

– filter the information based on requirement of inquiring side,

– share the data and information (anonymously) with the farmers’ “OK”,

The issue of data ownership

• Main activities:– Advice on agro-technology;

– Farm documentation:• Subsidy claims,

• Cross Compliance issues,

• Food Traceability requirements,

• Various reports to national bodies.

• Additional activities:– Possibility to run Logistics for group of farms;

• Transport optimization,

• Land use optimization, etc.

– Possibility to provide commercial services for:• Agro-Insurance companies,

• Agriculture oriented Banks,

• Commodity sellers, etc.

Business opportunities with FAS

Partners 1: Agro-Insurance

• FAS structure as a mean for:– Marketing

– Sales

– Direct interaction with clients

– Ensuring two way communication (top-down and bottom-up)

• IT PLatform as a mean for:– Insurance data verification

– Crating database of Insurance history in a• single farm

• region

• country

– Diversification of risk areas

– Basis for prognoses and strategy development

• Banks become part of FAS structure ;• Trainings for potential clients via FAS;• First hand and reliable information from the field;• FAS agent helps farmers to produce business plans;• Increased number of clients due to the easier access to

micro-credits;• Face-to-face communication with its clients (via the service

provided by FAS agent);• FAS agent may provide a non-direct advertisement;• Co-financing possibilities of the technological enrichment

of FAS.

Partners 2: Agro-Banks

• IT platform / data and FAS structure for qualified use of new products;

• Putting datailed characteristics of the products to the Agro-Technological database of AGROffice software;

• Using FAS structure and agents for indirect promotion of their products;

• Direct feedback from end-users on improvement of products sold;

• Opportunity to integrate the newest technologies in a basis of an IT platform used by farmers;

Partners 3: Commodity Sellers

• Governmental Institutions– Up to date field level information – e.g. statistical data filtered by

trust centers;

– Opportunity to receive digital subsidy claims;

– Tools for regional planning and monitoring

– Workforce for environmental issues

• Traders, Export organisations / Exporters– Food traceability / EUREPGAP compatible

• Food producing and processing companies – Quality increase and verification ability

Other beneficiaries (partners)

• Education and Science:– Permanent support for agricultural expertise database, setup

and update

– Use of the software for educational purposes – free of charge

– Experts develop, test and implement on top expertise (GIS, FOMUMMIS, logstics, rural area management, precision farming, virtual farming etc.)

• IT Companies– Localization of Progis products,

– Permanent technical support to users,

– Distribution of licenses for Progis products

• FAS– Trainings for AGROffice users

– Feedbacks for product improvement

– Distribution channel for AGROffice

Cooperation within AGROffice

• Tools for– rural area management,

– agriculture,

– forestry,

– pipeline management,

– risk management, etc.;

• Logistics– Map production or map preparation (import, vectorisation etc.)

– Application design including i-net web solution

– Integration of time, logistic optimisation and routing

– Hardware – stationary, mobile, GPS, GPRS Communication

– Track visualisation and calculation

– Machine guidance

• Project development (Progis know-how in background);

PROGIS business offers

• FAS (when equipped with appropriate tools) is an attractive business partner for those who sell products or services to farmers;

• FAS may provide timely, reliable and accurate field level information to governmental institutions and other interested bodies for strategic planning and monitoring;

• Agro-Insurance companies, Agricultural Banks and Commodity Sellers may become part of FAS with their investments that will ensure:– Independence of FAS from project based financing;

– More demand driven services for end-users;

– Dynamic development and sustainability.

• Cooperation within AGROffice brings and opportunity to fasten the linkages between science and extension.

Conclusions

Thanks for your attention!

By Arman Manukyan, Marketing Director, PROGIS Software AGEmail: manukyan@progis.com