Therese Cory, an analyst at Beecham Research, and one of the authors of a new report, Towards Smart Farming, said: "The demand for more food has to be set against the challenges of rising climate change and more extreme weather conditions, along with the environmental impact resulting from intensive farming practices."
In the immediate term, the Beecham Research report says that smart farming will allow farmers and growers to improve productivity and reduce waste, ranging from the quantity of fertiliser used to the number of journeys made by farm vehicles.
For crop farming, smart farming means preparing the soil, planting and harvesting at precisely the best time; while for livestock farming it includes monitoring the condition of animals to providing the right type of intervention at the right time.
In the longer term, smart farming will allow farmers and other stakeholders to better understand the wider conditions that lead to variables. Embedding intelligence into the design and operation of machines will allow sensor information to be combined with other data and the knowledge of the farmer.
"The ecosystem of suppliers and stakeholders is very complex," said Cory. "It ranges from large manufacturers of heavy agricultural vehicles to suppliers of M2M technologies and IT based decision support systems, along with providers of expertise in all areas of farming. Partnerships are key to forging a successful supply chain," Cory said.
While the use of M2M technology in farming is still in its infancy, the notion of a 'connected farm' is coming closer, says the report, connecting real time farming processes with a raft of historical data such as weather events, climate, economics, product information and machine settings, for instance.
Cory said: "We also anticipate that the use of smart farming will spread to adjunct areas, such as environmental monitoring, land management and food traceability. This is a consequence of the greater public focus on issues such as food safety, wildlife preservation and rural areas development."
Fellow Beecham Research analyst Saverio Romeo said: "In Europe, the move towards smart farming is being encouraged through various projects and programmes funded by public and private money.
"These include EU initiatives and projects at a national level."
Romeo added: "While the M2M agricultural sector is still emerging, M2M and IoT technologies will be key enablers for transforming the agricultural sector and creating the smart farming vision."
The report says the interest in IoT is already "strong" from agricultural machinery vendors such as John Deere, Claas and CNH Global, while there is also "considerable attention" on data and farm management systems from a variety of players, including agri-food giants like Monsanto.
Romeo said: "The US market is leading the way in smart farming, particularly in areas such as arable farming. Europe is increasingly looking into small-sized field farming, precision livestock farming and smart fish farming, and this trend will soon expand into other important agricultural economies."
In terms of time scale, the next two years will be "exploratory" for smart farming, says the report, but the pace of change will "intensify" from 2017 to 2020.