Strategic Elements (ASX:SOR) share price rises after latest announcement

The Strategic Elements Ltd (ASX: SOR) share price is leveraging robotics and automation to target the multi-billion dollar agriculture sector

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The Strategic Elements Ltd (ASX: SOR) share price has opened 5% higher today.This comes after the company announced that it successfully demonstrated the potential of its automation & robotics platform (AxV) to be leveraged for the multi-billion dollar global agriculture sector.

At the time of writing, the Strategic Elements share price has retreated slightly and is currently trading at 44 cents. Below, we take a closer look at the developments. 

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Image source: Getty Images

Strategic Elements announces potential of weed detection automation 

Strategic Elements are working to achieve early-stage validation for the detection of weeds. For this project, they are working alongside the Australian Herbicide Resistance Initiative and the University of Western Australia School of Agriculture and Environment. 

Advanced weed detection technologies typically use RGB cameras and different forms of imaging. This technology makes it possible to distinguish weeds and crops via colour. Strategic Elements highlights the 'serious limitations' of the technology in some scenarios. Particularly, in broadacre cropping where weeds are often the same colour as crops. Due to the similarities in colour, this form of detection often results in the excessive use of chemicals and production losses.

The company notes that the estimated cost of weeds in Australian cropping systems alone is at ~A$3.3 billion.  Comparatively, the annual cost of weeds in the United States is estimated at ~US$34.5 billion. 

Strategic Elements is taking a different approach to the issue. Their strategy involves leveraging its sophisticated sensor, mapping, and utilising localisation technology. This technology is already built and is used in its Autonomous Security Vehicle collaboration with US Fortune 100 company, Honeywell

The company has collected logistics and in-field scoping data from a large scale broadacre farm in Western Australia. This data allows Strategic Elements to enable detection of weeds protruding above the canopy of a barley crop. Weed detection prototype hardware was later developed and installed onto a combine harvester during harvest.

Algorithms were then developed, tested, and validated during the harvest. This occurred by comparing the location of weeds detected by the technology with known locations of weeds with visual confirmation. Although the testing was completed on a limited data set, the technology was able to detect 100% of weeds. The specifications included a height threshold of 20 cm above the crop canopy. 

Management commentary

Managing director, Charles Murphy commented on the company's versatile automation technology: 

Our strategy to build a platform that had applications across multiple industry sectors is starting to fulfill its promise. Our commercialisation strategy is to collaborate closely with end users to solve a real, existing problem with automation. From an Australian domestic market context other sectors like logistics and mining also have attractive opportunities and we are very active in seeking the right partners with which to collaborate.

The future of Strategic Elements

Looking ahead, the company targets further optimisation of the weed detection technology by 2Q21.

This will be followed by further product engineering in the third and fourth quarter. Further development will evolve the product into a versatile and easy to use package. This package will then be installed by farmers on a wider range of farm equipment.

Finally, the company aims to have a program running to deploy the weed detection technology to at least 10 potential end customer reference sites. Strategic Elements believes this will be operational in the November 2021 harvest. 

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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