With each harvest, we enhance procedures and technologies that promote significant developments in agricultural and industrial processes, which translate into the profitability of our businesses.

Pulse, our open innovation hub, celebrated two years, during which we counted close to 8,000 visitors and over 100 events (in-person and online), creating a network with more than 280 institutions.

We entered into partnerships with important players in the market to develop innovation projects, such as CNH Industrial and the partners of the Agro IoT Lab project, an application development program for the fields that focuses on the Internet of Things (IoT), Vivo, Ericsson and EsalqTec—the incubator of the Luiz de Queiroz School of Agriculture (Esalq/USP).

In 2019/2020, three resident startups were added to the portfolio, which now totals 28 (21 of which already have projects tested) totaling more than 50 pilot projects in our operations. Agricef works on solutions aimed at optimizing sowing processes, developing agricultural machines and equipment, and providing operational services; Taranis produces high-resolution aerial images for field monitoring, high-precision automated diagnosis, and artificial intelligence to recognize and address threats and crops; and Arpac provides services with drones, including the release of biological agents and detection of anomalies through images.

During this period, a partnership was also signed with Mitsubishi Corporation do Brasil SA, whose objective is to find solutions and technologies that can benefit its business, in addition to opening doors for startups and other partners of our hub. Pulse reinforces the position that its performance goes beyond agribusiness, fostering more and more innovative solutions.

As of the 2020/2021 harvest, the hub will also expand its operations in the innovation environment through the concept of associated startups. Companies that are interested in developing pilot projects with us can access the Pulse ecosystem, as well as its network, without necessarily being physically located in the hub, which expands our digital performance.

Another major milestone in the digital transformation journey is the launch of LACE (Lean Agile Center of Excellence), synchronized with the Pulse strategy to accelerate the culture of innovation and dissemination of methodologies and an agile mindset in our team.

Digital transformation

Technology has influenced everyday operations and the way people work and relate. This is the digital transformation that companies have been experiencing in order to improve performance and results. This experience is no different for our team. We aim to support the challenges imposed by a constantly changing world, applying the best Design-Lean-Agile practices in the development of successful products and services, in line with our business objectives and goals, to deliver value to customers.

Aligned with this transformation, Shell Box is our main digital product, which serves as a laboratory to experiment with the values and purposes of this great journey.

To accomplish this, we have a team and a range of tools and artifacts, together with the Lean Agile Center of Excellence (LACE), to ensure delivery of value to our customers and continuous improvement of the product, serving as a model for different digital products.

In the 2019/2020 harvest, we decided to unify our efforts in Advanced Analytics at the Raízen Analytics Center in the Shared Services Center (SSC), which began to lead the main project initiatives using Artificial Intelligence and Machine Learning. With this new structure, the main decisions will be based on carefully analyzed data that will affect the entire value chain, from analytical solutions to the agro-industrial front, including logistics, distribution, trading, and even influencing pricing policies, optimization, and customization of relationships with resellers and customers.

Another solution, also integrated into our Analytics Center, is the prediction of productivity in ton of cane per hectare, based on the processing of neural networks to interpret satellite imagery and several other system variables, from planting to harvesting of the sugarcane. The identification of flaws in the planting of the sugarcane fields and the presence of weeds that compete with the sugarcane is also carried out using algorithms.

With our resellers in mind, the Analytics Center is also providing support to the Sales area to identify opportunities to generate volume or profitability, analyzing each Shell station and its historic data. This will guide the efforts of the sales force to achieve the best results.

All of these initiatives are carried out in partnership with each business area in order to ensure that any potential identified is indeed captured, generating even more profitability and satisfaction for all our stakeholders: shareholders, resellers, partners, and customers.

Innovations in the field

We are currently conducting several technological innovation projects in the field. The initiatives are intended to ensure agricultural excellence and continue with the investments made in updating operations. They also allow a more intelligent use of resources, in line with existing technological advances in the market, maintaining our leading role in innovative solutions in the sectors where we operate.

Project Kronos

This is an agricultural tool, hitched to the tractor, which optimizes four crop treatment operations: scarification of soil and fertilization of the ratoon (cultivation); application of insecticides/nematicides (pest control); and herbicide application (weed control). These activities are carried out annually during the crop treatment phase, starting from the harvesting of the sugarcane in the second cutting and providing the necessary conditions for raw material to reach its highest potential.

This project saves time and manpower, in addition to increasing efficiency, as it relies on automation technology that manages the necessary amount of each input for each area.

We are pioneers in the adoption of this technology in the sugarcane sector, and Agricef, a startup in residence in Pulse, is responsible for its development. It is estimated that with this initiative, we will be able to reduce the costs of these crop treatment operations by up to 30%.

Project Kairós

The sugar-energy sector is known for not using planters with absolute precision, unlike the equipment used in the cultivation of grains, for example. With an eye on this opportunity, we also commissioned Agricef to develop a prototype that allows for a more assertive replanting of areas with flaws found in the sugarcane fields after the harvest operation.

The equipment being developed uses the flaws identified mainly by the images captured using unmanned aerial vehicles (UAVs). The equipment itself plants in the identified areas in a more assertive manner, using the exact amount of seedlings to correct the flaw detected.

Biological control

We have been working since 2019 with two partner companies—Geocom and SarDrones—on a pilot project for biological pest control in sugarcane fields through the dispersion of natural predators. We have already released a parasitoid of the sugarcane borer, the Trichogramma galloi. In the next harvest, 2020/2021, we will promote the release in 50% of our treated area (about 150,000 hectares) of the Cotesia flavipes, dispersed in biodegradable envelopes using drones.

This is a major challenge involving the rearing of the parasitoid and storage in the laboratory, as well as the reconciliation of this operation with other common activities in the field, including aerial application of maturation agents, flowering inhibitors, nutritional supplements, and pest or weed controls.

Unmanned Aerial Vehicles (UAVs)

The technologies embedded in UAVs allow for significant advances in agricultural operations, in addition to playing a critical role in enabling the development of new initiatives. The equipment supports the following gains in operations:

• Determining the volume of sugarcane bagasse in the field
• Measurement of planting flaws
• Measurement of the amount of invasive plants in sugarcane fields
• Mapping of crop treatments

We fly over 500,000 hectares per year. The equipment we use is of the “fixed wing” type; the smaller models have a capacity to fly at up to 60 km/h with autonomy of 40 minutes, and the larger models can fly at 80 km/h for up to 2.5 hours. We are the first company in the industry to use this technology on a large scale.

In October 2019, we trained the first pilot capable of operating the equipment, and 13 other professionals are currently being trained. The training course follows the guidelines of the National Civil Aviation Agency (ANAC), which is responsible for regulating and supervising the use of UAVs in the country.

Industry innovations

Reliability is a major factor in determining total recoverable sugars (TRS), a measure by which producers are remunerated. Another relevant factor is agility in the sampling process, so as not to impact the rate of crushing in the Industrial Unit. This is contingent upon the maximum possible representativeness since, in addition to remunerating the sugarcane producers, it is the basis of determining industrial efficiency.

The first Unit of the Laboratories of the Future Project, implemented at the Paraíso Unit in Brotas (SP), completed a pilot phase in 2019/2020 and continues to officially measure remuneration and industrial efficiency. We were able to consolidate the learning curve in the last months of the harvest, allowing this technology to minimize human interference and reduce the total analysis time by more than 90%. The next steps are to implement the model in other production units.

LABORATORY OF THE FUTURE (STEP BY STEP)

Another example of innovation in industrial processes is the adoption of technologies for collection, analysis, and optimization of process variables in our energy cogeneration systems, aiming at a better energy balance and, consequently, an increase in the efficiency and productivity of cogeneration by accurately indicating the most suitable parameter for a given stage in the process.

360º

In 2019/2020, we launched 360°, the platform of our commercial front that integrates our digital strategy. The 360° improves our relationship with customers and simplifies the daily lives of our sales teams.

Our challenge was to disseminate the new relationship platform among the Retail team and evolve, in partnership with the Analytics area, in what we call Missions: analytics in favor of better business decisions. We transform comparative data and performances into business opportunities and convert them into regular targeted missions to allow our sales force to focus on what will really make a difference.

In 2020/2021, our challenge will be to extend the 360° to our entire Commercial Sales team and bring the B2B Sales teams on board. On the other expansion front, we will increase our performance through the Missions and will continue to simplify processes and service interfaces with our Shared Services Center.

Impulso Raízen

In partnership with Endeavor, we held the first edition of Impulso Raízen in Argentina, an open innovation program aimed at startups and entrepreneurs. The contest was geared toward companies with recent developments in the areas of logistics, customer relations, and energy. More than 150 startups participated, and many of them got involved in different projects and partnerships with us. This was our first contact with that country's entrepreneurial ecosystem. The winning startup was SolarLatam, specializing in the installation of solar panel systems.