WHAT’S INSIDE THIS SPECIAL EDITION

• Innovations in AgTech, by a guest contributor Alyna Takahashi

IN PARTNERSHIP WITH ELF LABS

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Your coffee is under threat. Unless… AgTech can save it.

by guest contributor Alyna Takahashi

According to a USDA report, Brazil expects coffee production for 2024/2025 to total 66.4 million bags, a 5.8% drop from earlier projections due to irregular weather affecting arabica trees.

Carlos Mera, head of agricultural commodities at Rabobank, noted this will be the fifth consecutive disappointing arabica harvest caused by adverse weather. Coupled with possible new tariffs on Vietnamese coffee exports to the US, rising prices may push Americans to seek alternative sources.

Amid these challenges, a revolution in agricultural technology—AgTech—is underway to transform how and where we grow food. By leveraging innovations like epigenetics and digital twins, the industry is de-risking food production, building resilience against environmental volatility, and attracting investment in sustainable solutions.

Why do we need to de-risk?

We need these technologies to de-risk food systems primarily due to climate change which exacerbates extreme weather, directly affecting crop, soil, and livestock health. 

As Travis Bayer, CEO and co-founder of Sound Agriculture and Decibel Bio, says in a recent interview, “Big picture, I do think that the pace of change is something that agriculture is going to be challenged with…one is climate change and another is changing consumer preferences.” 

Geopolitical factors add on another layer of instability, impacting our vulnerable food systems and contributing to their disruption alongside climate change. President Trump's potential tariffs and trade disputes cast a shadow over agricultural stability as they will most likely ripple through the food system, potentially increasing consumer costs and squeezing the profit margins of American farmers.

Add in the demands of a growing population to the unstable supply chains, and a dire situation arises– one that impacts each of us.

Reactive to Proactive Solutions

Traditional farming is largely reactive and manual, with practices like spraying pesticides or applying fertilizer after problems arise. AgTech enables farmers to shift to proactive solutions: sensor networks and AI models can now detect early signs of pests or unfavorable conditions, allowing intervention before damage occurs.

This transformation is making agriculture more resilient to climate change, resource scarcity, and market volatility, while also attracting significant investment in sustainable solutions.

The Role of Technology

In a manual process like farming, how does technology come into play? In the event of a disease outbreak, a digital twin can detect the infection, identify the “patient zero” crop, alert the farmer, and apply a solution to the remaining plants that epigenetically strengthens their resistance to the disease.

What is Epigenetics? 

Epigenetics is a complex process but can be simplified, as Bayer explains: “DNA methylation are basically patterns of methyl groups [at certain DNA sites] that can help control gene expression…it’s like a tuning dial on gene expression.”

Sound Agriculture’s tomato project is a case in point. Instead of genetically engineering a more stable tomato (a process that’s costly, slow, and faces regulatory hurdles), they used epigenetics to tweak the expression of genes controlling cell wall breakdown. By soaking seeds in a solution that “locks in” the desired gene expression, they created tomatoes that last longer on shelves, reducing waste and increasing profitability.

This is just one of many traits farmers can now imprint onto their crops. The pace of environmental and market change is something epigenetics is positioned to help overcome. 

Applications 

Crops can also be “primed” epigenetically to remember and better survive environmental stresses and pass those adaptations on to their offspring. These innovations reduce reliance on traditional breeding timelines and lower the risk of catastrophic yield loss, making epigenetics a powerful tool for building more resilient and adaptive food systems. 

While the AgTech epigenetics market is still relatively new, the startups that do exist all capitalize on this. Investors like Syngenta and Breakthrough Energy Ventures have also funneled capital into these companies, suggesting confidence in these technologies as scalable solutions to food insecurity.

Although epigenetics is currently oriented towards agriculture, it has the potential to preserve vulnerable species, including livestock and coral reefs, giving these essential organisms an edge as they struggle to adapt to unstable climate conditions. This makes epigenetics a strategic tool for future-proofing global food supply chains.

What Are Digital Twins?

Digital twins are virtual models of farms that use real-time data with IoT sensors, satellite imagery, and weather stations. Farmers can simulate soil conditions, crop genetics, and supply chain logistics under contrasting scenarios like pest outbreaks before committing resources or changes on their physical farm. 

These are living data-driven models that evolve with every sensor update and allow farmers to visualize their whole operation like in the image below:

From Farms to the Sea

So, how are these futuristic technologies actually going to make a difference? Let’s dive in–literally. Forget the grassy green hills–the next frontier of agriculture could be under the sea. Nemo's Garden is an innovative project using underwater greenhouses, and Siemens' digital twin technology is helping them navigate the unique challenges of this environment. 

Ocean water temperature does not fluctuate as much as air temperature; therefore, the ocean has the potential to be a more stable environment for agriculture. Sunlight still penetrates through the water to where these greenhouses are shown in the image below, so the plants inside are still able to photosynthesize.

With digital twins modeling these variables, Nemo's Garden can proactively adjust conditions to ensure a stable, thriving underwater ecosystem.

Digital twins are transforming farm management by forecasting problems such as sudden weather events before they occur, allowing farmers to test scenarios, identify weak spots, and avoid costly delays and waste. This level of insight will mean fewer surprises at harvest and steadier profits even when the outside world is anything but predictable. 

Investment Patterns and Data

The AgTech industry saw falling VC deal activity in 2024, however, plant biotech and precision agriculture may be able to turn that around and attract significant investor interest. The two verticals are emerging as potential drivers of renewed investor interest, according to Pitchbook’s Q4 2024 AgTech VC Trends report. 

Despite the overall decline in deal activity in 2024– “attributed to high interest rates, unfavorable trading conditions for public companies, and challenging exit environment”–deal activity grew to $1.8 billion, representing an 8.9% increase QoQ. 

The median deal value reached a record high of $3.6 million in 2024, up 36% YoY. These investments reflect a broader shift towards technologies that mitigate climate vulnerability, with investors like Syngenta and the Chan Zuckerberg Initiative prioritizing companies that can enhance the resilience of crops and livestock.

Moreover, the global digital twin market is projected to flourish, with the market size expected to reach USD 110.1 billion by 2028 from USD 10.1 billion in 2023, growing at a CAGR of 61.3% during the forecast period from 2023 and 2028. 

The global epigenetics market is also anticipated to significantly expand, with the market size accounting for USD 2.42 billion in 2024 and is expected to exceed around USD 7.72 billion by 2034, growing at a CAGR of 12.30% from 2025 to 2034. Precision agriculture, a key area for digital twin technologies, attracted $2.1 billion across 238 deals in 2024, highlighting the segment's investment potential.

Established players are increasingly partnering with AgTech innovators to drive the adoption of industrial metaverse solutions. For example, the partnership between Siemens and Nemo’s Garden exemplifies how corporate investments are facilitating the integration of digital twins and other advanced technologies into agriculture. 

Regional Patterns

Adoption rates of industrial metaverse technology vary across regions:

• US: Implementation at 38%; 35% in testing phase.

• China: Implementation at 37%; 39% in testing phase. Asian countries have made notable strides, accounting for top 10 deals; the largest was a $200 million Series C investment in Aerodyne.

• Germany: Implementation at 34%; 32% in testing phase.

These figures highlight the growing interest in industrial metaverse technology as a means of de-risking agriculture and enhancing productivity. The concentration of investment activity in Asia underscores the region's growing importance in the AgTech landscape.

The Future of AgTech

AgTech innovations are fundamentally reducing risk in agriculture. Technologies like epigenetics and digital twins are making our food systems more resilient by boosting biological adaptability and operational efficiency.

Continued investment in these integrated solutions is crucial for scaling and widespread adoption, especially as climate change, geopolitical instability, and resource scarcity intensify food security challenges. By combining epigenetic modifications, which can help coffee plants thrive in water-scarce or colder environments, and digital twins that simulate real-time conditions, coffee cultivation could expand beyond traditional, high-tariff regions.

This synergy enables growers to establish coffee farms in new, stable areas, using epigenetic “priming” to counter local stressors and digital modeling to optimize logistics. These technologies create a resilient framework where the future of this global commodity can be secured, bringing the price of your latte down to $4 instead of $7.