XAG Co Ltd, China's largest agricultural drone maker, will increase investment in research and development, expand its footprint in global markets and build a smart agricultural ecosystem, as part of its broader drive to enhance working efficiency of farmers and promote digital agriculture technology.
The company has launched an unmanned ground vehicle and three types of agricultural drones that are used for seeding, fertilizing and spraying pesticides.
"It is very likely that XAG will be listed on the mainland stock market and we are actively preparing for it, but there is no specific timetable," said Peng Bin, chief executive officer and founder of XAG.
More and more cutting-edge technologies will be deployed in agricultural production and smart farm management, and there will be unmanned smart farms in the next three to five years, said Peng. Though the sector is still at an initial stage of development, Peng expects the smart agriculture industry to surpass 1 trillion yuan ($153 billion) in value.
"We have sold our products to 42 countries and regions across the world, with sales from overseas markets accounting for 15 percent of the total revenue," he said. Nearly 85 percent to 90 percent of its business came from the domestic market this year as the COVID-19 pandemic has ravaged several overseas markets.
Justin Gong, co-founder of XAG, said urbanization has been progressing rapidly in China, along with the aging of population in rural areas."In light of these challenges, we need to leverage the power of agritech to reshape the agriculture and food system, bridge the rural digital divide and help farmers yield higher profits from growing crops," he said.
To date, the company has trained about 100,000 professional drone pilots by providing dedicated training curriculums and services, including in-classroom and on-field training.
Last month, the Guangzhou, Guangdong province-based company completed a 1.2 billion yuan financing round, led by Baidu Capital and SoftBank Vision Fund 2 and other investors like Sinovation Ventures, Guangzhou Yuexiu Industrial Investment Fund Management and Guangzhou Emerging Industry Development Fund.
This is by far the largest commercial financing in China's agriculture-tech sector. XAG said it will enhance the R&D, manufacturing and service capabilities, enrich sales channels and accelerate the construction of digital agricultural infrastructure with the proceeds from this round.
Statistics from the Shenzhen, Guangdong province-based Qianzhan Industry Research Institute showed that the value of the domestic agricultural drone market will be around 12.8 billion yuan by 2021, with a compound annual growth rate of 38 percent.
Chinese authorities have released a guideline to promote digital technologies in rural areas as part of their efforts to advance agricultural and rural modernization.
The guideline, jointly issued by four government departments including the Ministry of Agriculture and Rural Affairs, encourages the use of technologies like big data, artificial intelligence, remote intelligent agricultural machinery and online services in areas such as spring farming, and vocational training and recruitment of migrant workers.
Lan Yubin, a professor at South China Agricultural University, said agricultural drones have played a vital role in promoting smart agriculture around the world in recent years. He said the drone technologies have been growing very fast, and fierce competition in the drone market is driving down prices all the time.