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Australian start-up reveals AI-powered farm valuation platform

Agtech start-up Digital Agriculture Services recently secured funding from CSIRO and has seen strong interest from investors in using its web-based platform.

An Australian start-up has developed software to automatically value every farm in the country, fueled by machine-learning artificial intelligence.

Digital Agriculture Services is running pilot schemes for its web-based platform after recently emerging from “stealth mode,” as co-founder and CEO Anthony Willmott put it to Agri Investor.

“Our proposition is that we’ve built the first rural intelligence platform for all Australian rural properties,” Willmott said. “Our objective is to provide consistent, standardized data on a national scale, so that lenders and insurers can make robust, accurate decisions with some level of confidence.”

DAS uses 35 data points for each Australian farm, including items such as its property boundaries, the number of buildings on the property, average slope, soil type and levels of production, and combines that with 10 years’ worth of sales data to produce a machine-learning model that estimates the value of each farm. The process is repeated every 30 days to provide up-to-date valuations.

“We hope to then use this to enable the automated valuation of properties as part of a portfolio management approach and to provide support for investors and operators to revalue their portfolio on a regular basis,” Willmott said. “It could also just help people estimate the value of farms without having to visit the property and really start a dialogue about their investment.”

The firm was established in early 2017 and has been operating under the radar until the last several months. It has secured A$4.25 million ($3.02 million; €2.66 million) in total funding to date, including an undisclosed amount from the Commonwealth Scientific and Industrial Research Organisation, an independent agency of the Australian federal government.

CSIRO’s stake in the company has been put at around 15 percent by Australian media reports. A CSIRO spokeswoman declined to confirm its ownership stake or the value of its investment, but said: “CSIRO does not invest in its start-ups as a money-making venture but rather to nurture [their] path to market”.

ASX-listed Ruralco is also an investor in the company.

“We’ve been working with CSIRO through an R&D agreement but also through an investment they’ve made into DAS to help us create the data that is required [by the agriculture sector],” Willmott said.

Trials are being undertaken with banks to see if DAS can help support credit valuation decisions and, with insurers, help understand the fundamentals of a farm property and how susceptible it is to climate change.

“Rural properties have particular risk metrics they need to manage against – the risk of drought, the risk of frost at critical moments on cropping properties, the risk of extreme temperatures on production at dairy properties,” Willmott said. “Being able to [map] those risks onto your portfolio enables lenders and investors to understand what mitigation strategies they need to put in place, or where the opportunities for investment are.”

Willmott says that investors have been particularly interested in using the platform so far and that DAS is good at estimating the value of properties between 100 and 100,000 hectares in size, while getting better all the time at assessing properties outside that range.

“If we can de-risk Australian agriculture, we can give investors greater confidence to make investments in agriculture, and then give them tools to monitor those assets over the life of their portfolio,” he said.

“Agriculture is such an important industry for Australia, and making the industry successful is a critical driver of value for all of us.”