Vertical Farming Growth Accelerated by Coronavirus

August 14, 2020

By Victoria Campisi

The coronavirus pandemic has disrupted the traditional U.S. food and agriculture supply chain, providing a potential growth opportunity for vertical farms.

One recent deal made in the space involves Singapore-based Temasek Holdings Pte and Bayer AG forming a new company called Unfold, which will develop seeds for vertical farms.

Unfold raised $30 million in an initial funding round and entered into an agreement for certain rights to germplasm—the genetic material from which plants grow—from Bayer's vegetable portfolio, according to the two firms. By utilizing the germplasm from vegetable crops, Unfold will focus on developing new seed varieties coupled with agronomic advice tailored for the unique indoor environment of vertical farms.

The venture will focus on innovation in vegetable varieties with the goal of lifting the vertical farming space to the next level of quality, efficiency, and sustainability.

"The investment in Unfold is a great example of a transformative, creative approach to developing agricultural products that meets the needs of consumers, farmers, and the planet by increasing access to fresh fruits and vegetables, supporting sustainably grown, hyperlocal production, and addressing food security challenges faced by growing urban populations,” said Jürgen Eckhardt, MD, head of Leaps by Bayer, which was built to drive fundamental breakthroughs in the fields of health and agriculture through new technologies.

Vertical farms utilize indoor growing facilities that leverage artificial light, reduce dependency on synthetic chemistry and other crop inputs, optimize water use, and allow food growth in challenging environments with limited arable land. They also help crops grow quicker, enabling the reliable growth of fresh, local produce anywhere and at anytime by utilizing less space and fewer natural resources while reducing the need for food logistics and transportation.

In July, vertical farming company Kalera announced it will open a state-of-the-art growing facility in Houston, TX, during spring 2021. The Houston facility will be the largest vertical farming facility in the state.

The new facility was introduced just two months after Kalera revealed it will be opening a new facility in Atlanta in early 2021—an announcement that took place less than two months after it opened its second Orlando, Florida farm. The Houston facility will be even larger than the Atlanta one, which is slated to be the highest production vertical farm in the Southeast.

“In light of the global pandemic and seemingly endless food safety recalls, today, more than ever, consumers are demanding food that is local and that they can trust, said Daniel Malechuk, CEO of Kalera. “Houston presents Kalera with a wonderful market for our produce, as it allows us to not only supply one of the largest cities in America, but also service cities throughout the region including Dallas-Fort Worth, Austin, San Antonio, and New Orleans." Kalera’s lettuce from the Houston farm will be available at retailers and foodservice distributors.

Meanwhile, Greenswell Growers will invest $17 million to open a hydroponic greenhouse in Goochland, VA, reported Richmond Times-Dispatch (Aug. 11). The facility will reportedly produce 28 times more product per acre than a traditional growing operation, and the company expects to yield about 3.7 million-lbs. of leafy greens, which it will distribute throughout the Mid-Atlantic region.

“Greenswell Growers is proud to bring our large-scale indoor growing facility to Goochland where we will provide delicious, safe, and sustainably grown leafy greens that are good for our community," said founder Chuck Metzgar.

In Scotland, indoor agritech specialist ISG completed a deal with vertical farming operator Vertegrow to build the first commercial vertical farm in the country. This is the first move into vertical farming for Vertegrow, diversifying alongside existing agricultural operations, currently growing crops including barley and rye in open fields.

The towers, which are expected to be operational in early 2021, will grow a variety of crops that are intended to service the local food supply chain. Vertegrow will work with a range of local customers including retailers, caterers, restaurateurs, and other local services, to deliver produce all year round.

The four-tower system will be built in Aberdeenshire in Scotland later this year.

To listen to The Food Institute's webinar featuring AeroFarms, a leader in indoor vertical farming, click here.

About the Author

Victoria Campisi
The Food Institute
Victoria writes for the biweekly Food Institute Report, the daily Today in Food updates, and the Foodie Insider daily newsletter for consumers. She graduated from Montclair State University with a B.A. in Journalism and has a background in Nutrition and Food Science. Victoria can be reached through her email at victoria.campisi@foodinstitute.com.

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