Yes, I have also invested in real estate, tech stocks, and service businesses. But I would like to explain what fascinates me about vertical farming, besides the underlying growth and expected profit. There is a bigger picture.
One of the flip sides of global trade is that a nation can lose its ability to provide consumer staples and articles of daily use to its own population, as long as at least one raw commodity can be exploited and exported to pay the mounting bill for imported food. While that is ok for indulgence products, luxury food, exotic fruits, and spices – for fresh food and essential nutrition, this can be a hidden problem. The dependence on food imports leads to a straightjacket for governments, who cannot escape the status quo, while import prices rise. That, in turn, demands subsidies to cushion the inflation effect onto the local population, which leads to growing deficits, debt, and a need to generate FX by dumping the exportable commodity product—a vicious circle.
Growing enough food for the basic needs of citizens is not a “nice to have” thing. It is the license for economic freedom. Today, still one of nine people is underfed. Before reaching the culmination point around the year 2100 our global population will further grow. By 2050 we will approach 10 billion. If these children of ours and their descendants are supposed to have enough food, we will have to enhance food production massively, estimations say by 70%. And here comes the catch: if we do that in the same way as today, we will see an accelerating degree of environmental destruction, destabilization of ecosystems, and reduction of biodiversity. We will see frightening drops in water tables, global water scarcity, and ever-rising food prices. Soil erosion and degradation would lead to tipping points in many regions, with deserts grabbing land that could hardly ever be reclaimed. As a result, people would not have enough food, not enough water, and not enough money to buy energy or medicine—a perfect recipe for cataclysmic social reactions.
The primary antagonist of peace is injustice. When people feel that they do not have sufficient access to the resources they need for their livelihood - like food, water, medicine, and education - they become first frustrated, then aggressive, and finally desperate. That is the point where war, civil war, belligerent civil unrest, and terrorism spawn. Eradicating the injustice that leads to all of this is the best way to ensure or restore peace.(1)
What will happen is that an ever-growing share of humans will live in cities. That drives the distance between food production and consumption up. Today, the average distance food travels to reach supermarket shelves in developed countries is already a staggering 2’400 km—yet another non-sustainable situation. The CO2-related impact of the enormous energy input in the shape of artificial fertilizer, long transportation routes, and massive water irrigation volumes is fuel to the fire of climate change, which is the biggest gamble for global food production. And climate change hits especially those regions that depend on agriculture! That often leads to an urge to convert additional nature and rainforests to farmland, which again sets free vast amounts of CO2 – yet another vicious circle, compounding the other.
So what do we need to do?
We need to grow food on a significantly smaller surface, giving back land to nature.
Water use per ton of food output needs to drop drastically.
Applied fertilizers and chemicals need to be dramatically reduced and not wasted as agricultural runoff that on top poisons groundwater reserves.
Food needs to be produced close to urbanizations and especially staple foods within every national economy.
And: farming needs to regain appeal. Needs to attract our youth. Needs to improve its image.
And here is what vertical farming does relative to the must-haves mentioned above:
The same amount of fresh produce can be grown on 1% of the surface.
Water consumption is reduced by around 95%. In principle, the only water leaving the farm sits inside the product itself.
Nutrients are entirely absorbed with zero waste. Zero need for insecticides, pesticides, fungicides. Zero runoff. Beyond Bio.
Vertical farms are a subset of Urban Farming. Micro-supply chains allow vastly optimized demand-supply coordination and extremely short transport distances. And yes: it works everywhere. In arid countries, on small islands, in Nordic regions.
Vertical farming is sexy. Urbanites can take their bike from their modern flat and be at their workplace at the farm within 15 min. Tech savviness is a welcome extra. The Fourth Agricultural Revolution.
But what is perhaps the final argument: try the food! It’s tasty, and ultra-fresh with shelf-life doubled compared to conventional farming. There is a perceived drawback. The technology employed in indoor farming needs energy, or not? True, but less than you think, less than conventional farming, and on top, it perfectly fits for the application of renewable energy.
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(1): The Four Industrial Revolutions - Demystifying Technologial Innovation; p. 206,
Tobias Becker, 2019, ISBN9783000645518