Digital transformation of the agricultural sector: prospects, challenges and solutions

Abstract

The digital transformation of the agricultural sector has received considerable attention due to its potential to increase efficiency and productivity. This paper reviews recent research and publications to identify key themes and gaps in the digitalisation of agriculture. The analysis shows that while some studies highlight the potential benefits of digital agriculture, others emphasise the limitations and challenges associated with its implementation. The case of Ukraine fits into the ‘light digitalisation’ scenario, where agriculture digitalisation is at a basic level, data control is limited, and digital literacy and technology adoption varies among different agricultural stakeholders.To promote the digitalisation process, data exchange between stakeholders such as farmers, government, traders, producers, consumers and AgriTech should be improved. Digital platforms, e-governance, agricultural extension, access to financial services and information exchange are very important for digital transformation. The author explores digital interactions between farmers and agri-tech companies, food traders/producers and consumers, highlighting the elements and benefits of such interactions.The role of the government in creating a reliable digitalisation system and facilitating cooperation between stakeholders is discussed. It proposes the implementation of solutions such as farm management systems, data collection tools, decision support systems and data-driven farming technologies. These solutions facilitate data analysis, informed decision-making and optimisation of farm operations.Challenges and limitations associated with the digital transformation of the agricultural sector are limited financial resources, regulatory constraints, resistance to change, and privacy concerns. Further research is needed to explore data quality standards, data ownership and privacy rules, skills development, modelling systems and digital platforms.
 JEL classification: H83, O38, Q10, Q18