Moving beyond manual labor and tractors, farmers are harnessing computers and artificial intelligence to revolutionize agriculture, boost efficiency and maximize crop yields, according to Fidelity’s Kyle Willinger, who is looking to potentially capitalize by cultivating investments in several companies that provide the technological tools.
“Whether it’s helping farmers manage spraying weeds with cameras or more efficiently tracking inventory, producers are eager to leverage technology to optimize their farming operation,” says Willinger, who co-manages Fidelity® Agricultural Productivity Fund (FARMX) with David Wagner.
Launched in April 2020, the thematic equity strategy is dedicated to investing in companies that help to increase efficiency in food production amid a growing global population and declining per capita supply of arable land.
In helming the focused fund, the co-managers have been paying particular attention to technological innovators that could potentially change the business landscape, including those that leverage GPS, sensors and data analytics to help farmers monitor and manage crops at a granular level, among others.
Willinger is particularly enthusiastic about precision farming, which uses internet-connected devices to precisely measure and analyze soil moisture, nutrient levels, pest activity and other factors important to a farming operation.
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This technology collects and transmits real-time data that farmers can access remotely, making it possible to monitor their fields and make informed decisions from anywhere, according to Willinger. For example, he says, internet-connected weather stations can provide accurate weather forecasts, helping farmers plan their activities accordingly.
“This tech-aided, targeted approach minimizes resource waste, increases yield and improves crop quality,” Willinger points out. “It also makes it easier for farmers to tailor their intervention to specific areas within their fields, saving time and money.”
Additionally, farm-management software now encompasses various facets of farm management and provides comprehensive features for farm planning, recordkeeping and financial management.
“It helps farmers efficiently track inventory, monitor expenses, generate reports and analyze performance metrics,” Willinger says. “Additionally, these platforms often integrate other technology, such as drones and internet-connected devices, enabling seamless data exchange and analysis.”
As of May 31, related fund holdings included Deere (DF), AGCO (AGCO), Toro (TORO) and U.K.-based CNH Industrial (CNH). Deere is by far the top holding, representing about 23% of assets.
“Deere is at the forefront of this trend,” Willinger explains. “From machine performance to field management and data analysis, Deere is providing farmers with a variety of technological tools for automating and improving farm operations, which is precisely the sort of innovative company we aim to hold in the fund.”
For specific fund information, including full holdings, please click on the fund trading symbol above.
Kyle Willinger is a portfolio manager and research analyst in the Equity division at Fidelity Investments.
In this role, Mr. Willinger manages Fidelity Agricultural Productivity Fund. Additionally, he is responsible for covering the food service industry.
Prior to joining Fidelity in 2019, Mr. Willinger worked as an equity research intern at River Road Asset Management. He has been in the financial industry since 2017.
Mr. Willinger earned his Bachelor of Arts in finance from University of Louisville.