Global Shortage of Semiconductor Chips Creates Challenges for Farmers Wanting to Adopt Agricultural Technology

If you’re trying to get your hands on a new car, the latest phone, or a gadget, you may have had to wait due to a global shortage of semiconductor chips.

But the technological crisis is not only affecting manufacturers of electronic products; it is also affecting farmers trying to modernize their operations.

Agricultural technology entrepreneur Tom Mills develops remote monitoring systems, but has had to redesign his products.

“For custom components, what we need to do now is essentially wait for what chips are available, pre-purchase those chips, and then design our gear or refine our designs around that,” he said.

The chip shortage comes at a difficult time, as many farmers need labor-saving technology to combat worker shortages and improve productivity.

“We’ve been left behind because we haven’t invested in this technology to date,” Mills said.

“That’s why a lot of the automation technology found in dairies comes from European countries because they’ve had to pay staff there a lot more for some time.”

What caused the chip shortage?

A close up of a computer chip
Lockdowns and the rush to work from home caused a huge spike in sales of electronic devices.(Supplied: Axonite)

Semiconductor chips are the backbone of a wide range of electronic devices, but supply has been limited since the COVID-19 outbreak.

The lockdowns sparked a consumer electronics boom, as workers and students scrambled to buy devices to help them work from home.

While demand has soared, supply has been hit by a severe drought in Taiwan, which has halted production of water-intensive chips at the world’s largest maker, TSMC.

The shortage may ease as the COVID disruption fades and the US implements more than $50 billion of stimulus to boost production.

Two men converse in an old tin pump shed on a sprawling family farm.
Farmer Charlie Mackinnon talks with agricultural technology provider Tom Mills on his family’s farm in Longford.(Rural ABC: Lachlan Bennett)

Meanwhile, early adopters like Tasmanian farmer Charlie MacKinnon are already reaping the rewards of farming technology.

Before installing the remote monitoring systems, the Longford man spent hours every day driving around his property to check every sprinkler and water pump.

“And if there was a problem, go back to turn it off, go back to the pivot to fix the problem, and go back to the pump to turn it on,” he said.

“And then also going to bed at night with the sprinklers running, waking up in the morning to see if anything went wrong.”

The technological crisis is not limited to chips

A proud young woman stands in a field wearing a wide-brimmed hat.
Agritech entrepreneur Fiona Turner of Bitwise Agronomy helps farmers tackle job challenges.(Rural ABC: Lachlan Bennett)

Job constraints in the berry and viticulture industries prompted Fiona Turner to found the automated crop testing company Bitwise.

While the software-centric startup was not affected by the chip shortage, cloud computing had been a problem.

“With energy shortages and rising costs globally, that will have a massive impact on our costs to use cloud providers,” said Ms Turner.

“So we’re watching that very closely.”

James sits at a cluttered ag tech desk, grinning broadly as he shows off one of his gadgets.
Farm Pulse’s James Walsh says farmers are already facing delays in purchasing new machinery, so they are not put off by a shortage of chips.(Rural ABC: Lachlan Bennett)

James Walsh, director of remote farming technology company Farm Pulse, said his company had avoided the worst effects of the shortage by not relying on a single technology or manufacturer.

But they still had to “manage expectations.”

“Anyone who is in technology and trying to get raw materials has had problems,” he said.

“But most of our customers have been very understanding because they realize there’s a shortage of everything right now.”

Despite the challenges, Walsh said the chip shortage had not affected demand.

“Progressive farmers are always looking for that edge,” he said.

“Because agriculture is so buoyant right now, people are looking for those efficiencies for when things get a little tougher. So they’re willing to spend money on technology.”

Creative solutions to the chipper challenge

In a large tin shed, Andrew holds a large black drone, the size of an arm.
University of Tasmania Technology Solutions Center Manager Andrew Willoughby says drones have great potential to improve productivity on Australian farms.(Rural ABC: Lachlan Bennett)

Those who couldn’t get their hands on technology were getting creative, according to University of Tasmania technology solutions center manager Andrew Willoughby.

“Chips are really hard to come by and some of our students are now creating their own chips, making their own chips for use in robotics and other electrical components,” he said.

“As part of their own course, they have gone above and beyond what was expected.”

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