Agriculture & Food - Overview
60% of large farms use precision ag. But 59% of ag companies spend less than $100K on AI. USDA has no AI framework. FDA/FSMA covers food safety, not model governance. This is an early-stage market with real regulatory surface -- when an AI-driven food safety decision fails, the evidentiary burden lands on the operator.
60% of large farms use precision agriculture. But 59% of agricultural companies spend less than $100,000 on AI -- signaling SMB experimentation, not enterprise deployment. The 25% CAGR is growing from a tiny base. USDA has no AI framework. FDA FSMA covers food safety processes, not model governance. The gap is 16 points, concentrated in the disconnect between precision ag tools -- which are essentially deployed AI -- and the complete absence of governance infrastructure around them. When an AI-driven crop management system recommends a pesticide application that violates EPA FIFRA limits, or an AI-powered food safety system misclassifies a contamination risk, the evidentiary burden falls on the operator. The framework to support that burden does not exist yet in agriculture.
This industry includes 3 segments in the Ontic governance matrix, spanning risk categories from Category 1 — Assistive through Category 4 — Safety-Critical. AI adoption index: 3/5.
Agriculture & Food - Regulatory Landscape
The agriculture & food sector is subject to 16 regulatory frameworks and standards across its segments:
- Allergen labeling (FALCPA)
- CFTC (commodity trading)
- EPA FIFRA (pesticide application)
- EPA FIFRA/Clean Water Act
- FDA FSMA
- HACCP requirements
- OSHA (agricultural operations)
- Organic certification (USDA NOP)
- State agricultural boards
- State food safety agencies
- State water boards
- State water rights agencies
- USDA APHIS (7 CFR 340)
- USDA FSIS (if meat/poultry)
- USDA regulations (7 CFR)
- Worker Protection Standard (40 CFR 170)
The specific frameworks that apply depend on the segment and scale of deployment. Cross-industry frameworks (GDPR, ISO 27001, EU AI Act) may apply in addition to sector-specific regulation.
Agriculture & Food - Agriculture -- AgTech / Precision Ag Startup
Risk Category: Category 1 — Assistive Scale: SMB Applicable Frameworks: USDA regulations (7 CFR), EPA FIFRA (pesticide application), State agricultural boards, State water rights agencies
USDA has no AI framework. EPA FIFRA still applies to every AI-recommended pesticide application.
The Governance Challenge
AgTech startups provide AI-driven field analysis, crop recommendations, and equipment maintenance predictions. Precision agriculture is essentially deployed AI — 60% of large farms use it. But USDA has no AI governance framework. EPA FIFRA applies to pesticide application recommendations regardless of whether a human or model made them. State agricultural boards and water rights agencies govern operational decisions. When an AI-driven crop management recommendation violates application limits, the operator carries the liability. The AgTech vendor has no governance infrastructure to support the defense.
Regulatory Application
EPA FIFRA governs pesticide application regardless of how the recommendation was generated. USDA regulations (7 CFR) govern agricultural operations. State agricultural boards enforce jurisdiction-specific requirements. State water rights agencies regulate AI-influenced irrigation decisions. No AI-specific agricultural governance framework exists.
AI Deployment Environments
- Studio: Field analysis summaries | Crop recommendation drafting | Equipment maintenance logs
- Refinery: Input application record governance | Compliance reporting templates
Typical deployment path: Studio → Studio → Refinery
Evidence
- 60% of large farms use precision agriculture
- 59% of ag companies spend less than $100K on AI — early stage, high growth
- USDA has no AI governance framework; EPA FIFRA fills the gap by default
Agriculture & Food - Agriculture -- Food Manufacturer / Processor
Risk Category: Category 2 — Regulated Decision-Making Scale: Mid-Market Applicable Frameworks: FDA FSMA, USDA FSIS (if meat/poultry), HACCP requirements, State food safety agencies, Allergen labeling (FALCPA), Organic certification (USDA NOP)
HACCP documentation requirements apply to AI-generated food safety records identically.
The Governance Challenge
Food manufacturers and processors deploy AI for production record assistance, supplier qualification summaries, training content, label compliance, HACCP plan documentation, and recall communication. FDA FSMA, USDA FSIS (meat and poultry), and HACCP requirements govern food safety documentation with detailed traceability mandates. Allergen labeling (FALCPA) applies to AI-generated label content. When an AI-generated HACCP record contains an error or an AI-generated label omits an allergen, the manufacturer faces FDA/USDA enforcement — not the AI vendor.
Regulatory Application
FDA FSMA governs food safety management systems including AI-generated documentation. USDA FSIS applies to meat and poultry processing AI outputs. HACCP requirements demand detailed traceability for every food safety record. FALCPA allergen labeling requirements apply to AI-generated label content. State food safety agencies add jurisdiction-specific requirements. Organic certification (USDA NOP) applies to AI-generated organic labeling claims.
AI Deployment Environments
- Studio: Production record assist | Supplier qualification summaries | Training content drafting
- Refinery: Label compliance governance | HACCP plan documentation | Recall communication templates
- Clean Room: FDA/USDA inspection readiness packages | Recall investigation evidence bundles
Typical deployment path: Refinery → Refinery → Clean Room
Evidence
- FDA FSMA inspection readiness is the primary compliance concern for food manufacturers
- HACCP documentation failures are the most common FDA warning letter trigger in food safety
- Major allergen-related recalls can exceed $10M in direct and indirect costs for large manufacturers
- AI adoption in food manufacturing is accelerating from a low base
Agriculture & Food - Agriculture -- Large Grower / Commodity Operator
Risk Category: Category 4 — Safety-Critical Scale: Enterprise Applicable Frameworks: USDA APHIS (7 CFR 340), EPA FIFRA/Clean Water Act, CFTC (commodity trading), State water boards, OSHA (agricultural operations), Worker Protection Standard (40 CFR 170)
EPA does not have an AI exemption for pesticide application limits. The model's recommendation is the operator's liability.
The Governance Challenge
Large growers and commodity operators deploy AI for crop planning analysis, compliance reporting, market analysis, pesticide application record governance, water usage compliance, and worker safety communication. USDA APHIS, EPA FIFRA/Clean Water Act, and CFTC (commodity trading) regulations create a multi-agency governance surface. When an AI-driven crop management system recommends an application that exceeds EPA limits, or an AI-assisted trading algorithm executes a position that triggers CFTC review, the operator carries the liability — and the AI's recommendation chain becomes the investigation evidence.
Regulatory Application
USDA APHIS (7 CFR 340) governs AI-assisted agricultural operations. EPA FIFRA governs pesticide application including AI-recommended applications. Clean Water Act applies to AI-influenced irrigation and runoff decisions. CFTC governs AI-assisted commodity trading. State water boards regulate AI- influenced water usage. OSHA applies to AI-influenced agricultural workplace safety. Worker Protection Standard (40 CFR 170) governs AI-generated worker safety communications.
AI Deployment Environments
- Studio: Crop planning analysis | Compliance reporting assist | Market analysis summaries
- Refinery: Pesticide application record governance | Water usage compliance narratives | Worker safety communication
- Clean Room: EPA investigation evidence packages | CFTC audit files | Environmental compliance reconstruction bundles
Typical deployment path: Refinery → Refinery → Clean Room
Evidence
- 60% of large farms use precision agriculture — which is deployed AI
- EPA FIFRA enforcement authority extends to AI-recommended applications
- CFTC commodity trading AI governance requirements are emerging
- Agricultural AI liability is early-stage case law with significant exposure