France: Still room for some va va voom?

Farmers dumping manure in front of government buildings is probably not what French president Emmanuel Macron had in mind when he promised​ to “accelerate the agricultural and agri-food revolution” back in 2021.

But as the tractors unloaded in January this year, it was a clear sign that for all France’s effort to transform agriculture in recent years, farmers are still not entirely satisfied with the results.

Macron’s promise came as part of his France 2030 plan, a sweeping agenda to encourage “technological champions” to help deliver the country’s ecological transition. This included €2.3bn for agriculture, a sum divided between financing for innovative solutions and aid for farmers to help them invest in new technologies.

To a degree, French agri-tech is certainly better for it. Groundbreaking companies such as Innovafeed and robotics pioneer Naïo Technologies are laureates of the programme, and the scheme is often credited with helping France cement its place as one of the top European countries for agri-tech fundraising in recent years.

It is certainly offering up serious money, with agriculture making up 4.2% of the total France 2030 budget, exceeding the sector’s 3.3% contribution to French GDP.  

The ultimate idea is not only to transform French food production, but to make France an agri-tech world-leader that exports technology to the world’s biggest markets. “If the cradle of [start-up] development will be France, very quickly their playing field must be the world,” says Jerome Le Roy, president of La Ferme Digitale, the leading association for French agri-tech.

“Innovative companies must understand more quickly the limits of the French market alone. Make France a force while not hesitating to develop in the most promising markets as early as possible in the life of the company.”

Government support lacking​

But there are concerns that France 2030 is falling short on these ambitions. “In view of the strategic issues that this sector carries, it seems legitimate to ask whether these amounts are sufficient to support international ambition,” said a KMPG report earlier this year. The report pointed to Italy, for example, which is investing €1.3 billion in agri-tech despite having a much smaller sector.

But the government’s actions have gone further than just France 2030. In 2021, it also launched ‘La French AgriTech’ with one goal: to accelerate disruptive technologies in the agriculture and food sectors through financial and professional support. The initiative has since been taken on by La Ferme Digitale which has evolved the idea into a consolidated ecosystem to support innovation in French food and agriculture.

And even without government support, French agri-tech is alive with innovation. France is now home to over 250 agri-tech start-ups, according to La Ferme Digitale, including pioneering companies like Innovafeed with has helped make France a global leader in insect-based foods.

However, recent investment in French agri-tech has proven volatile. While France bucked a global trend in 2022 to surge 39% to $1.3bn against the backdrop of a 46% decline in Europe over the same period, it then halved to $540m the following year, according to AgFunder. This left France behind the UK, Germany, and Spain as Europe’s top destinations for agtech investment.

In some ways, it was not a huge surprise. Economic uncertainty and high interest rates meant investment in all French tech fell by a third last year and agtech was generally lauded for staying above the symbolic milestone of half a billion euros.

“The appeal of agri-tech and foodtech remains present with an increase in the number of operations,” said KPMG. “The ecosystem stood out despite an unstable economic and geopolitical context that continues to arouse caution among investors to this day.”

French start-ups selling protein alternatives are especially attractive, raising €304m in 2023 although this was dominated by the €160m raised by Ÿnsect which has since slid into financial challenges and restructuring.​

Last year was arguably one for the smaller companies, with the number of deals involving companies of revenue under €10m growing by 26% to a total of €119m, according to KPMG.

France’s agri-tech innovation is not just limited to new players, however, with the likes of Moët Hennessy now pumping millions of euros into its own innovation and technology for winemaking.

Adoption of robotics growing rapidly​

France’s biggest wine producers are proving to be some of the earliest adopters of new technologies, with many turning to robotics as a solution to labour shortages throughout the countryside.  

While there are still only around 250 wine robots in the country, their popularity grew significantly last year thanks to governmental subsidies that cover 40% of the initial €200k cost for individual farmers, or 50% when the robot is shared, says Christophe Gaviglio, an experimental engineer at the French Institute of Vine and Wine.

Gaviglio added that electric robots were often more precise at weeding than humans, used less energy than ­tractors, and were less damaging on soil due to their lighter weight.

Yet while wine producers are some of the most vociferous users, robots can now be found across the French countryside with more than three-quarters French farmers owning at least one robotized tool, according to the French ministry of Agriculture and Food.

These are supplied by some of France’s biggest agri-tech companies, including Naïo Technologies and Agrointelli, which are eyeing up a global market for agricultural robots now was worth $14bn last year, and expected to grow to $40bn by 2028, according to MarketsandMarkets.

It goes to show that even if the government is falling short on its ambitions to help French agri-tech go global, there is no shortage of companies willing to do it off their own back.