Agri Tech Opportunities

We spoke to Agri-EPI member Chris Milnes from Partner& to find out about risks to agri-tech businesses around cyber security.

The last year has transformed the business environment in which we all work. As we have all had to get used to a new way of working, those with more nefarious aims and ambitions have also had to pivot, and we have seen a huge spike in cyber-attacks.

Over the past 12 months

• 88 percent of businesses have reported a breach of their IT systems.
• One small business has been hacked every 19 seconds in the UK
• 37 percent of businesses in the UK have reported a data breach to the ICO

The cost associated with these breaches can be huge, both directly and indirectly

• A third of all businesses said that they have lost clients due to cyber breach
• 41% of customers said they would never return to a business that had suffered a cyber attack.
• The average cost of a ransomware attack is nearly £600,000, and 48% of businesses have reported being subject to an attack of this variety.
• Investors are increasingly looking at firms cyber security/defences as part of their due diligence

Agri-tech

Agricultural firms are quickly turning to ‘smart farming’ and ‘precision farming’ and therefore becoming reliant on technology to run their machines and equipment.  The ‘Locking’ of these systems due to a cyber-attack could lead to a loss of production, spoiled stock (severity determined by food type), compromised integrity of quality control systems, unfulfilled customer contracts with traders and processors, project delays…and most importantly, very expensive system damage costs to rebuild the systems and get back up and running again.

For many of the firms in the Agri Epi ecosystem they are fully reliant on their intellectual property, and whilst they are at the start of their journey, a breach could be catastrophic for the business. We are seeing ransom demands well into the millions when technology has been compromised.   Equally, because agriculture is so heavily dependent on seasonality and have a very small harvesting window, a cyber-attack during these periods as the ability to wipe an entire year’s revenues.

Some of the food network technologies being used that are susceptible to an attack include:

• Online portals for rural payments and livestock tracking
• SCADA production systems
• HVAC systems in livestock farms, production lines
• Agricultural machinery
• Smart sensors for soil moisture, weather stations
• Logistics management software

Given agricultural firms are a crucial component of the supply chain, firms will be working with multiple vendors and suppliers leading to frequent and high cost inbound/outbound fund transfer payments.  Malicious actors will often look to intercept these and conduct a classic social engineering scam diverting funds elsewhere.

Threats

The threat from Cyber Criminals is ever evolving and increasing, and is underestimated by firms across all sectors. Only 1 in 3 firms currently buy any level of cyber insurance, and we estimate that only 1 in 11 firms buy the right level of cover.

Due to the increase in claims there is an increasing realisation from larger corporates that they have to invest in cyber security defences, and as such we are seeing a substantial increase in budgets to combat the risks –we are seeing cyber criminals pivot again to attack smaller firms, where the size of the prize may be lower but they are easier prey

The team at Partners & are keen to help their clients understand the ever-increasing threat around cyber attacks and as such we’ve invested substantially in our offering around cyber risk. One of the key tools that we have access to can run a non-invasive report on your website, which enables you to see what gaps cyber criminals may look to exploit – many of which are easy to fix

We’re keen to support the Agri Epi community and if you’d like for us to run one of these reports, free of charge, or discuss anything else around cyber risk and insurance, please drop us an email or call

Partners& aims to be the best insurance advisory business in the UK, providing expert advice that makes a real difference across business insurance, management and employee benefits.

Partners& services cover the energy and renewables, food and drink, manufacturing, retail and wholesale, science and technology and waste management sectors, among others.

Contact:
chris.milnes@partnersand.com 07917028965