Over 4 billion people have joined the global population in the last 50 years, putting stress on available farmland, water and fertilizer. At the same time, the capacity of the planet to absorb farm waste – toxic farm runoff contaminating aquifers and rivers – has stretched the limit. Nearly 8 billion people now depend on 5.5 million square miles of water-guzzling farmland for their food.
Vertical farms, by contrast, look enticing. Depending on who you ask, and what crop you’re growing, they only require somewhere between 1 percent and 5 percent of the water required by outdoor farming. They also operate in a completely controlled environment, which eliminates the need for pesticides and herbicides.
They can be located anywhere. By siting them within urban areas, the transportation and refrigeration costs necessary to get the crops to market are largely eliminated. With all of these competitive advantages, why aren’t vertical farms sprouting up everywhere?
An interesting 2021 study published in the Rutgers Business Review attempts to quantify these cost variables to compare traditional farming to vertical farming. The authors found that vertical farming was at a huge disadvantage to traditional farming with respect to energy cost and labor cost, while enjoying a decisive advantage in terms of water cost. The analysis was an oversimplification, since these costs vary greatly depending on what crop is being compared, but overall it found vertical farming currently to run about 2.5 times more expensive per unit than traditional farming.
This cost disadvantage is not deterring innovators from entering the field. According to the Food and Agricultural Organization of the United Nations, farming worldwide is a $3.4 trillion industry, constituting 4 percent of total global GDP. The vertical farming market, already worth an estimated $3.3 billion in 2020, is projected to grow to $24 billion by 2030.
At that size, it will still represent a fraction of the total global farming economy. Its growth prospects – assuming the cost constraints can be overcome – are stunning.
Investors are taking notice. In San Francisco, a company aptly named “Plenty,” has already received nearly $1 billion in venture financing, with investors including Amazon’s Jeff Bezos, Google’s Eric Schmidt and Softbank’s Masayoshi Son. Plenty’s CEO Matt Barnard intends to build 500 farms in major cities around the world. Barnard was born into a seventh-generation Wisconsin farm family, but his vision for AgriTech is quintessential Silicon Valley.
In a recent podcast interview, Barnard explained how he attracted some of the top investors in the world: “What we are able to do in a Plenty farm is recreate the best soil and climate conditions on Earth for each individual food product and we can make them even better.”
Plenty’s approach to achieving cost parity with traditional agriculture mirrors the leading vertical farming companies. They are attacking the labor disadvantage with robotics, with the goal of having a mostly automated vertical farm that remains safe and ergonomic for the remaining human workers. The challenge of energy to heat vertical farms and apply artificial sunlight to the plants is harder. Every serious contender in the large-scale vertical farming market considers its technological solutions and internal costs to be trade secrets.
Along with Plenty, another U.S.-based player includes Bowery Farms in New Jersey. Bowery Farms, already valued at an estimated $2.3 billion, has two operating “warehouse farms,” and is currently constructing three more. As reported in Bloomberg earlier this year, they just acquired a robotics company, Traptic Inc., which makes “artificial-intelligence-enabled robotic arms that pick strawberries.”
Outside of the United States, Sky Green Farms in Singapore offers a look at how the challenge of artificial lighting and heating is minimized in a tropical climate. With equatorial sunlight delivering roughly 12 hours of daylight year-round, Sky Green Farms claims they have no need for artificial lighting.
According to its website, it automatically moves the vertical towers of plant trays in and out of the sunlight coming into the periphery of the glass-clad building: “Rotation is powered by a unique patented hydraulic water-driven system which utilizes the momentum of flowing water and gravity to rotate the troughs. Only 40 watts electricity (equivalent to one light bulb) is needed to power one 9 meter tall tower.”
Lack of sunlight, however, isn’t deterring investors in the far northern latitudes. In Germany, Infarm GmbH, founded in 2013 and based in Berlin, has built a global network of vertical farms. According to its website, “With operations across 10 countries and 30 cities worldwide, Infarm harvests 500,000+ plants monthly while using 99.5 percent less space than soil-based agriculture, 95 percent less water, 90 percent less transport and zero chemical pesticides. Today, 90 percent of electricity use throughout the Infarm network is from renewable energy and the company has set a target to reach zero emission food production next year.”
Skeptics may be forgiven for questioning the bold renewable energy claim. The real question is how much electricity does it take to grow a kilogram of food? Nonproprietary estimates that might answer this question are scarce. An in-depth 2012 study published by the National Center for Biotechnology Information evaluated hydroponic farming and concluded most of the energy consumed by vertical farms is for heating and cooling, and transportation fuel to bring the produce to market.
As for electricity for lighting, advances in LED technology, to the point where the spectral characteristics of the lights are tailored to each plant physiology, will bring down this cost. On the other hand, humanity is going to have to crack the challenge of abundant energy with or without the added demands of indoor farming, and if global food shortages become acute enough, it won’t matter how much energy these farms require, they’ll still get built.
It may be profitable, or nearly so, to grow leafy greens and strawberries and wine grapes in your vertical farm, but what about wheat, corn, rice, soybeans, barley, sorghum, cotton, rapeseed, millet, and dry beans? These are the top 10 crops by acreage in the world, and together, these crops consume over 90 percent of all arable farmland. This fact, even more than energy, is a challenge that vertical farming technology has yet to address, but solutions may be in the works.
Dickson Despommier, professor emeritus at Columbia University, spoke with me about this challenge and others in a recent phone call. Currently working with students at Fordham University to design the sustainable city of the future, and author of the 2010 book “The Vertical Farm Feeding the World in the 21st Century,” Despommier is considered the father of vertical farming. As he explored in a 2020 paper, “wheat grown on a single hectare of land in a 10-layer indoor vertical facility could produce from … 220 to 600 times the current world average annual wheat yield.”
Imagine wheat, currently consuming nearly 25 percent of all farmland in the world, suddenly requiring a fraction of one percent of farmland. If Despommier’s vision were actually implemented, and all the wheat in the world were grown this way, it could require buildings that altogether would have a footprint of only 1,500 square miles. Put another way, the space necessary to produce the world’s wheat crop would shrink from 3,200 square feet per person to only five square feet per person.
It’s a long way from here to there. For example, the most efficient vertical farms are “aeroponic,” which means that the roots hang freely from a growing scaffold to dangle within a nutrient-rich mist. This precisely controlled mist requires precision sprayers, and precision sprayers routinely clog. For all its promise, vertical farming today is an extremely capital intensive business and is limited to high value crops.
But as world population stands poised to pass the 8 billion mark, the ongoing innovations of the vertical farmers will play a growing role in feeding humanity – and could even boost the economies of cities.
Edward Ring is a co-founder of the California Policy Center and the author of “The Abundance Choice: Our Fight for More Water in California.”
