Agriculture in Southeast Asia is mostly made up of small farmers operating at subsistence levels. Exposed to inefficient, government-run marketing schemes and local markets dominated by middlemen, small farmers in this region struggle to find direct access to resources and markets.

According to Yasuo Taniguchi, CEO of LTID Co. (Long Term Industrial Development Company), alignment of buyer and farmer interests is a very important step for the agriculture sector to enhance productivity and quality, thereby leading to mutual prosperity for all stakeholders. The Japan-based startup develops digital applications that can effectively connect farmers to growing markets. The objective is to use technology to help small farmers improve their income while enabling consumers to buy products at a fair price.

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LTID Co. is ramping up its investment in its current mission to build a digital ecosystem in Southeast Asia and its current focus is on the Philippine agricultural sector. Under the existing scenario, Filipino farmers are highly vulnerable to exploitative practices by middlemen, a problem common to many farming communities in Asia. Hampered by a lack of infrastructure to raise finance, transport agricultural produce, and undertake marketing activities, small farmers find it difficult and expensive to compete as they have to conduct banking and sales operations and run efficient transportation networks apart from cultivation and farming duties.

Taniguchi believes that technology can help farmers become more efficient via techniques such as dynamic pricing and credit assessment mechanisms using the power of Artificial Intelligence. “While there is a constant need for financing in the Philippine agricultural sector, the traditional business model of banks is expensive and difficult to meet especially in developing countries like the Philippines,” explained Taniguchi. “We felt that there was room for growth and a need to improve efficiency,” added Taniguchi.

Can digital platforms empower farmers in Southeast Asia?

The digital apps and services that LTID Co. is creating are built to maximise the potential efficiency in the agriculture sector, thereby increasing farmer incomes, and empowering small farmers for a better future.

AgriDrive is an online transport matching service through which farmers can easily find available drivers to help them fulfil delivery orders of agricultural products. “We are providing free smartphone application that implements fintech by providing dynamic pricing to streamline the food value chain. It uses AI algorithms to match likely sendees (farmers, etc.) with drivers easily and quickly, at low cost.”

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While farmers will benefit from a convenient and affordable solution to their transportation needs, drivers are expected to get more delivery orders through this application too”, said Taniguchi. Security measures are implemented such as verification through photos taken on delivery and arrival to ensure there is no scope of fraud. Additional features include reputation scoring of drivers, messaging between senders, drivers, and recipients, along with a touchless and easy to use payment system.

Their second app in development is Agri Uber, “which has the functionality to let farmers form a digital agricultural cooperative”, Taniguchi explained. Cooperative farming refers to an organisation in which each member-farmer pools together their land and labor resources so that cultivation can be done jointly. Cooperative farming can help farmers benefit from economies of scale by lowering the cost of inputs or hiring services such as storage and transport. An agricultural cooperative system enables farmers to improve product and service quality and reduce risks.

Empowering farmers through cooperatives

Taniguchi believes cooperatives hold the key to a more efficient sector and wants to help the ASEAN agriculture market become more developed by introducing the Agri Uber app that empowers farmers to digitally form agricultural cooperatives. “This will increase the income of farmers and enable consumers to buy vegetables at a fair price,” said the LTID Co. CEO.

Taniguchi believes these digital platforms can have a deep impact on agricultural markets in the Southeast Asian region. While LTID Co. believes in helping farmers, they also realise that their digital platforms need to provide value to both buyers and sellers. “The revenue produced by this platform will be shared with the farmers and we will aim for mutual prosperity while standing on the side of the farmers,” remarked Taniguchi.

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LTID Co. has laid out ambitious goals along with the determination to continuously produce benefits to the region and bring in long term industrial development. Taniguchi announced his goal for LTID: “In 10 years, the goal is to secure a 10% share of the agricultural market, introduce agricultural cooperative services to farmers in Southeast Asia, and raise their income levels to that of developed countries. “We will aim to improve the efficiency of agriculture in Southeast Asia in one fell swoop,” Taniguchi proudly announced as the mission of LTID.

As they embark on their plan to launch their services across the region to aid their expansion in the Philippines and other countries, LTID Co. has been granted subsidies by the Ministry of Agriculture, Forestry and Fisheries of Japan. In addition, Japan External Trade Organization (JETRO) is assisting the startup by introducing them to networking and business opportunities in the Southeast Asian markets.

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This article is produced by the e27 team, sponsored by JETRO

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