West Coast Supply Issues Prompt More Demand At Indoor Farms

By Ashley Nickle March 09, 2017 | 2:23 pm EST

Indoor farms are seeing increased demand as weather-related production issues in Arizona and California have affected the supply of leafy greens.

Rain has interrupted planting and harvesting in California throughout the season, and the Yuma, Ariz., deal is expected to finish earlier than previously thought after mildew proved to be a major problem.

With West Coast supplies tight, several indoor farms have reported increased interest from buyers.

New York, N.Y.-based BrightFarms, which has greenhouses in Illinois, Virginia and Pennsylvania, has seen retail orders rise in recent weeks.

“It has been impacting most of our customers pretty significantly and their availability on items like spinach and arugula and other baby greens items as well,” said Abby Prior, vice president of business development for BrightFarms.

“Because our crop cycles are relatively short, we have a lot of flexibility to be able to adapt on planting cycles relatively quickly,” Prior said. “That is really a daily and weekly process with our retailer partners, looking at their forecasted demand, and we can adapt our planting pretty much daily based on their needs.”

Prior said the company will likely be providing higher amounts of product at least through March as crops transition from Yuma to California.

Milan Kluko, CEO at New Buffalo, Mich.-based Green Spirit Farms, said his company has seen an uptick in interest in the last month due to the Western production problems. Green Spirit can only increase capacity at its New Buffalo location — it also has a farm in Detroit — about 20% due to space constraints, but it has been ramping up production as much as it can.

One of the large supermarkets with which Green Spirit works is ordering double what it did a few weeks ago, Kluko said.

Robert Colangelo, CEO of Portage, Ind.-based Green Sense Farms, said the company has been shifting production to meet higher demand. Green Sense grows micro greens, baby greens, herbs and lettuces but will produce about 30% more lettuce and less of other items to address customer needs.

Benjamin Kant, CEO of Chicago-based Metropolitan Farms, said it is hard to tell whether his company’s current strong demand is a direct result of the West Coast production issues because the company just completed its first full year in operation.

However, Kant said he has heard complaints about higher prices and lower quality of West Coast product.

Marc Oshima, chief marketing officer at Newark, N.J.-based AeroFarms, said demand has “absolutely” increased lately but noted overall interest has been high for a while.

“It’s not just recently,” Oshima said. “These are ongoing issues that have troubled the industry.”

All five of the indoor farms interviewed for this article have recently expanded or are expanding.

“The more we (as a country) see challenges in sourcing all of our produce from a relatively small area on the West Coast, farms like ours and companies like BrightFarms will continue to grow and will continue to gain relevance in the produce industry,” Prior said, “and we’re glad to be able to fill the gaps at times like these where retailers are struggling.”