Deveron UAS Ltd. (DVR:CSE) announced in November a partnership with The Climate Corporation, a subsidiary of Monsanto Company (MON:NYSE), that will combine Deveron's drone-provided aerial imagery data with The Climate Corporation's Climate FieldView digital analytics agriculture platform.
According to the companies, "the addition of Deveron supports Climate's commitment to deliver a true digital ag ecosystem where farmers can access a broad, interconnected set of tools, services and data to optimize all of their farm management decisions."
"'Signing both these major ag players is massive validation that Deveron is indeed the leader in the drone space for investors.'– Rick Mills"
"As remote sensing through advanced imagery continues its fast-paced development, drones are increasingly playing an important role to help farmers gain deeper insights into crop performance at scale," said Mark Young, chief technology officer for The Climate Corporation. "Deveron has built a broad network of drones and sensors across North America to provide farmers with more data solutions to manage field variability, and we look forward to working with them to equip more farmers with data-rich imagery insights to make the best decisions for their operations."
"The Climate Corporation's Climate FieldView platform aligns closely with our mission of delivering farmers a simple data collection solution, coupled with advanced analytics, to help farmers more precisely monitor their crops," said David MacMillan, president and chief executive officer for Deveron. "Partnering with the Climate FieldView platform will further our ability to bring low cost, high-resolution imagery to more farmers so they can zero in on exactly what's happening in their fields and gain actionable insights to help them achieve the highest return on investment."
Streetwise Reports recently spoke with Rick Mills, founder of Ahead of the Herd newsletter, who is also a farmer in Canada, about the use of drones in agriculture. "Farming is all about the cost of inputs versus what you get when you sell the outputs," Mills explained. "What you put into the farm and what you get back out determine your profit. The drones actually save you enormously on inputs, whether they're for irrigation, herbicide spraying, fertilizing. It can help you in the emergence, when your plants start to grow and come up out of the soil. Now, in your post-emergence, you can fly your fields and you can actually see where your crop might be coming in a little light, and you can actually get in there and seed in time to help you recover on the crop. You can spot disease coming in much easier."
"Deveron offers the large operators—those with hundreds of thousands of acres under their management—one comprehensive place where its data are stored, where it can download to its growers, the people who actually own the plots of land where the food is being grown. When you're a big business—Deveron recently signed on Bonduelle—you can actually see your crop, you know what each of your operators is going to be growing. The grower is benefitting because they know exactly what kind of a crop they're going to have. They can predict yields. It makes life simpler for everybody because you know what's going on in the fields in real time."
"Why do farmers sign up their land to be basically organized or grow under an umbrella for a company like Bonduelle? It takes a lot of the decision-making process off their shoulders. Now they're told what to do. And then Bonduelle comes in and even flies the drones and takes away another layer of decision-making and uncertainty in pre- and post-emergence. I think removing the uncertainty in a lot of this is a key to understanding why companies like Bonduelle can get so many acres under management and why they would want a company like Deveron to fly drones and why drones are going to be such a huge change. It's almost revolutionary in the ag industry."
Regarding the deal with Monsanto's subsidiary the Climate Corporation, Mills said, "The new partnership with Climate Corporation offers farmers even more tools, data and imagery to make better decisions in real time. This deal with Monsanto plus the one with Bonduelle emphasizes the importance large ag players are placing on Deveron's first mover advantage, building its growing network of pilots and drones. Signing both these major ag players is massive validation that Deveron is indeed the leader in the drone space for investors."
Streetwise Reports also spoke with Fabrice Taylor, publisher of the President's Club investment letter. "I don't know a lot about farming," Taylor said. "I do have a number of wealthy, modern farmers on my subscriber list. I showed Deveron to a couple of them, and they said there's absolutely a need for what the company is doing. They were telling me how farming has changed. These farmers are doing 1,500 hectares or more and they're all about return on investment or return on equity. There is a need for this, and they will pay for this if it adds value."
"I do think that Deveron is more of a data story. Farming, if you think about it, is an information business; you're factoring a lot of bits and pieces of information and trying to make a decision out of them. Deveron has a clear potential role in that whole chain of events, and the early results suggest that it is on to something. Basically, Deveron will have assets that are tough to replicate once they start collecting all this information. That builds a moat around the business, and makes it tough to compete with, especially if it can get a critical mass of data and clients. It sounds as if there's not a ton of competition that does exactly what Deveron does, so that's an added bonus."
"There are companies that haven't delivered a fraction of what Deveron has in a much longer time, that have market caps that are four or five times bigger. So, at some point, something has to give, and I'm guessing the market cap of this is going to go up."
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1) Patrice Fusillo compiled this article for Streetwise Reports LLC and provides services to Streetwise reports as an employee. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
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5) Fabrice Taylor: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: Deveron UAS. I determined which companies would be included in this article based on my research and understanding of the sector. I had the opportunity to review the interview for accuracy as of the date of the interview and am responsible for the content of the interview.
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