Deere Seeks Satellite Network to Connect Far-Flung Farms

Farmers require Wi-Fi to use tractor maker’s data services, automated equipment

· Driverless tractors for plowing fields, and sprayers that distinguish weeds from crops.

· Precision fertilizing capabilities on its seed planters, which the company said reduces by 60% the amount of starter fertilizer sprayed during planting.

The farm-equipment company wants to use satellites to connect farms in remote areas of Brazil and the U.S. as the company rolls out high-tech machinery and software designed to sow and harvest crops more quickly, and with less manpower.

Deere, which had $52.5 billion in revenue last year, wants to generate 10% of its annual revenue by the end of the decade from software fees for using driverless tractors, smart crop sprayers and other enhancements for its farm and construction equipment.

The Moline, Ill.-based company last year started offering driverless tractors for plowing fields, and sprayers that distinguish weeds from crops. Deere this year introduced precision fertilizing capabilities on its seed planters, which the company said reduces by 60% the amount of starter fertilizer sprayed during planting.

To provide driverless tractors and keep smart sprayers updated, executives said Deere needs widespread connectivity, often in some of the most remote, rural parts of countries.

“The areas that aren’t covered are where a lot of our customers are doing their work,” said Jonny Spendlove, Deere’s senior program manager for connectivity.

The auto-steering system, based on the Global Positioning System, or GPS, that has guided Deere’s tractors and combines for about 20 years isn’t capable of providing access to the company’s full line of current digital services, company executives said. Those include monitoring equipment working in fields, remote troubleshooting and real-time data on soil, seeds and planting.

For Deere’s newer digital products, farmers generally have relied on wireless signals broadcast from land-based towers. Limited Wi-Fi service, particularly in sparsely populated rural areas, is keeping some farmers from using the new services, executives said.

About 80% of the U.S. is covered by wireless service. Deere executives said the lack of adequate connectivity is particularly acute in Brazil, one of the world’s largest producers of soybeans, sugar cane, oranges and other agricultural commodities.

Brazil is also home to huge farms that cover hundreds of thousands of acres. Deere said no more than one-third of Brazil’s territory is connected to land-based Wi-Fi service and the company expects about half to be covered in a decade.

To compensate, Deere said it is working to assemble a network of space-based satellites that will beam signals to farms in Brazil and isolated pockets in the U.S. without Wi-Fi. Deere said it expects to select a satellite operator later this year and start marketing the satellite service to farmers by the end of 2024. Executives said they are evaluating whether to charge farmers for satellite service.

Deere dominates the market for high-horsepower farm equipment in the U.S. and Canada. In Brazil, Deere has more formidable competition from CNH Industrial NV, the maker of Case IH and New Holland-branded equipment and Agco Corp., whose brands include Fendt and Massey Ferguson.

CNH purchased Raven Industries Inc. in 2021 to supply the technology for autonomous equipment and precision spraying capabilities. Agco, which reported a 62% increase in equipment sales in South America last year over 2021’s level, is using its Precision Planting LLC unit to provide farmers with data on field conditions and seeds.

Agco last week said it would extend an agreement with Sweden’s Hexagon AB to supply an upgraded version of the guidance and auto-steering system offered on Agco’s tractors in Brazil.

CNH and Agco also are dealing with connectivity challenges in Brazil. CNH last year set up 4G broadband cellular service for Água Boa, a town of 26,200 people in the west-central state of Mato Grosso.

The move allowed about 50 nearby farmers to connect to CNH’s data-collection and farm-management systems and helped CNH distribute the cost of the cellular service to more users than just farmers, said Marc Kermisch, CNH’s chief digital and information officer.

Rogerio Ferrarin, a Mato Grosso farmer, said he built his own cellular network for his equipment and employees on 13 separate farms covering 328,650 acres.

Mr. Ferrarin said the improved coordination and monitoring of his equipment allows him to raise two crops in a year, planting a new crop at the same time he is harvesting corn and soybeans. Mr. Ferrarin, who mostly uses Deere equipment, said he runs 130 harvesting combines and 85 tractors on his farms at the same time, along with a fleet of trucks to haul away the harvested grain. During busy times, as many as 1,000 people work on his farms.

“We couldn’t do this without the technology,” Mr. Ferrarin said through an interpreter. “It would help to have 100% connectivity. There are some blind spots now. It’s not perfect.”

Deere’s Mr. Spendlove said the company hosted a meeting last September to outline its connectivity requirements to about 60 companies, including satellite providers and those that manufacture the receivers linking farm machinery to Deere’s cloud-based operations system.

Deere late last year solicited proposals from the companies and has selected a group of finalists. Mr. Spendlove declined to specify the number or the names of the companies.

Deere said it currently has 500,000 farm and construction machines connected to its cloud-based operations center, and aims to add 1 million more by 2026. Mr. Spendlove said most of the additional machines will be connected through land-based wireless networks. He estimated that 50,000 to 100,000 of the additional machines would be connected through satellites.

Caleb Henry, director of research for satellite- and space-consulting firm Quilty Space, said he expects the size of Deere’s satellite account to attract highly competitive offers from satellite-service companies.

“You’re looking at a really big opportunity,” he said.