Vertical Farming Startup Achieves “Plenty” with Less Water
Vertical farming startup Plenty aims to turn conventional farming on its head through sustainable procesess that significantly reduce the amount of water required to feed produce while delivering high yields.
Agriculture constitutes 80% of the demand for water in the US, making it by far the largest consumer of water, yet less than 10% of farms utilize sophisticated irrigation technology to optimize water usage [1]. Although conventional farms are increasingly turning to advanced irrigation methods to curb water wastage, the adoption rate is not as high as it should be considering their level of consumption. Vertical farms are poised to disrupt this phenomenon, through software and machine learning, by distributing water to produce in a more targeted manner that mitigates waste.
One such vertical farm startup based out of San Francisco, Plenty, has been making headlines for its ambitious plans to make produce more fresh, nutritious and accessible while proactively reducing water consumption. The process of extending the life of produce generates environmental waste that Plenty seeks to reduce. Lastly, produce travels 1500 miles on average from farms before reaching grocery stores, Plenty wants to significantly reduce this to a matter of hours stores [2].
How Plenty Plans to Tackle the Water Shortage
Backed by investors Jeff Bezos and SoftBank, Plenty has secured $200M in funding that would enable it to build a vertical farm “in every major metro area with over 1 million residents.” [3] To brace itself for this expansion in the short term, Plenty is building out initiatives that will allow it to scale while being mindful of water usage.
One of the primary initiatives is recycling water, by filtering surplus water that accumulates at the base of the plant towers and redistributing it [4]. In addition, a dehumidifier “captures the condensation produced from the cooling hardware, along with moisture released into the air by plants,” and this water is harvested and also redistributed [5]. Plenty claims that when compared to traditional farms, “its technology can yield as much as 350 times more produce in a given area as conventional farms, with 1 percent of the water.” [6]
Furthermore, Plenty is using software to regulate water usage. The software is connected to sensors and infrared cameras scattered across the vertical farm, and analyzes the health of plants, advising growers on whether certain plants need more water or light to survive.
In the long term, Plenty has an aggressive growth plan that involves expanding in the US to 60 farms close to key cities and internationally to over 300 [7]. Specifically, for global expansion, Plenty is targeting regions that are predisposed to droughts or have a shortage of arable land such as the Middle East, Japan and China [8].
Other Opportunities for Plenty to Consider
While Plenty has their hands full with these initiatives, there are other opportunities they should pursue to avoid a fate similar to other highly publicized vertical farms that failed to be profitable. Plenty needs to directly address how they plan to offset high energy costs through other production efficiencies. Although Plenty uses gravity to feed their produce rather than energy intensive pumping mechanisms, for energy-intensive production processes it should investigate renewable energy sources such as solar.
The locations of future Plenty farms will be critical to its profitability and ultimately long term viability. Plenty needs to operate in cities with supportive local governments that offer permits or grants that lower barriers to entry rather than optimizing only for major metros. For example, Atlanta, Georgia is encouraging urban farming by easing the “regulatory burden…and has a goal of putting local healthy food within a half-mile of 75% of the city’s residents by 2020.” [9] They should also consider cities based on those whose water departments offer rebates to businesses with water conservation systems in place. By carefully curating the 60 cities in US they plan to expand into, they can create mutually beneficial relationships with the cities.
Lastly, as Jeff Bezos is one of its investors, Plenty should look into opportunities to leverage Amazon’s global infrastructure to lower operating costs. Plenty could share space with some of Amazon’s lower traffic warehouses or distribution centers.
Can Vertical Farming and Conventional Farming Achieve Synergies?
Reflecting on the lofty plans that Plenty and other vertical farming companies have laid out, how probable is it that they can beat conventional farms in terms of achieving higher yields with fewer inputs (i.e. water, fertilizer, etc.)? Are there ways that conventional and vertical farms can collaborate to deliver produce that is fresher, healthier and more environmentally responsible?
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[1] Mark Berkman. (2015). The electricity-water nexus: Is a crisis imminent? Water Policy, 17(6), 1163-1175, ABI/INFORM via ProQuest, accessed November 2017.
[2] Leopold Center for Sustainable Agriculture, “How far do your fruit and vegetables travel?” (2002). Leopold Center Pubs and Papers. 6. http://lib.dr.iastate.edu/leopold_pubspapers/6, accessed November 2017.
[3] Selina Wang. “This High-Tech Vertical Farm Promises Whole Foods Quality at Walmart Prices.” Bloomberg, September 6, 2017. [https://www.bloomberg.com/news/features/2017-09-06/this-high-tech-vertical-farm-promises-whole-foods-quality-at-walmart-prices], accessed November 2017.
[4] Ibid
[5] Ibid
[6] Ibid
[7] Jacob Bunge and Eliot Brown. “Indoor Farming Takes Root at California Startup.” Wall Street Journal, February 13, 2017, ABI/INFORM via ProQuest, accessed November 2017.
[8] Ibid – Selina Wang. “This High-Tech Vertical Farm Promises Whole Foods Quality at Walmart Prices.” Bloomberg, September 6, 2017.
[9] Betsy McKay. “Agriculture (A special report) — A farm grows in the city: Startups are leading the way to a future in which more food is grown closer to where people live.” Wall Street Journal, May 15, 2017, ABI/INFORM via ProQuest, accessed November 2017.
[Featured Image] Ibid- Selina Wang. “This High-Tech Vertical Farm Promises Whole Foods Quality at Walmart Prices.” Bloomberg, September 6, 2017.
Plenty is a promising concept, but upon reading this article I found myself wondering how it can possibly produce 350 times more produce than a conventional farm and still be cost effective. As discussed above, they save some money by using gravity instead of pumping the water but can it overcome the additional costs from software and machine learning algorithms used for water management?
Fast Company did an article on Plenty that highlighted the company’s claims to grow crops at equal or lower cost than in the field. [1] To me, achieving this is the true game changer. Environmentally friendly farming solutions will continue to fail as their predecessors did until they are able to provide the same quality as the field for equal or lower cost.
Interestingly this article claims that on top of achieving the cost, Plenty’s farming methods also allow them to grow crops that previously weren’t available due to the fragile nature and the long supply chain (>3000 miles in many cases). By locating indoor urban farms closer to population centers they can provide rare varieties of mizuna, lettuce, kale and more that typically would get damaged in transport. This is where I believe they will compete with large conventional farms. Although they don’t have the efficiency of scale they are physically closer to the consumer, environmentally friendly, and offer a new array of produce. Overall, I agree with your plan for future growth (managing energy costs, expansion selection, leveraging infrastructure) but I think it depends critically on Plenty achieving these lofty cost and efficiency claims.
[1] Peters, Adele. “Has This Silicon Valley Startup Finally Nailed The Indoor Farming Model?” Fast Company, Fast Company, 30 June 2017, http://www.fastcompany.com/40420610/has-this-silicon-valley-startup-finally-nailed-the-indoor-farming-model.
Plenty and other indoor/vertical farming companies certainly have high potential for business success and agricultural sustainability (e.g. reducing use of pesticides, protecting biodiversity by reducing the impacts of ‘mono cropping,’ etc.), but am curious to see if they will have a net positive impact on water consumption in agriculture.
With nuts like pistachios and almonds gaining popularity around the world, many farmers are already switching to these high margin crops. The problem is that these require an enormous amount of water to grow (the water necessary to grow 1 tomato can only produce 3 almonds, http://www.businessinsider.com/amount-of-water-needed-to-grow-one-almond-orange-tomato-2015-4 ). The effects of this shift are already being felt in California recently, where nut farmers continued to consume vast amounts of water through one of the worst droughts in the state’s history.
Since the types of crops that Plenty is growing only require a relatively low amount of water for outdoor growing, and a shift to indoor farming will free up more space for water-intensive crops, I wonder how the overall consumption of water for agriculture will pan out.
That is an incredible technology! Plenty is very innovative in the use of resources and certainly can bring down the cost of several agricultural products in places like Israel, where resources such as water are very limited and there is not much space for traditional farms. However, I am curious to understand what mixes of products will be profitable for a vertical farm in a country that does have cheap resources and plenty of space, such as the U.S. or Brazil.
Another great point you made relates to the synergies of Plenty and companies like Amazon. I wonder how much scale Plenty would have to achieve to have a possible synergy in serving Amazon for its Amazon Fresh supply chain. I imagine that it would take a huge investment to grow the company to such a scale and I wonder if Jeff Bezos invested in them just to track Plenty until they have proven their business model and then acquire then to scale inside Amazon.