Search

Vertical farming’s mission to localize, decarbonize and democratize food production

Updated: May 14

by Ella Westlake | May 13th, 2021


Vertical farms are challenging the unsustainable ways our food is traditionally produced and supplied. Urban Oasis, a vertical farming start-up in Stockholm, Sweden, is aiming “to bring healthy, affordable and sustainable food to the many people”, but can this young industry deliver on its vision?


The unsustainability of traditional farming


Agriculture, and its rapid expansion, is having a dramatic impact on the environment. It is one of the largest contributors to climate change, accounting for 26% of global greenhouse gas emissions. Biodiversity is being threatened as 50% of the world’s habitable land is being used for agriculture; it is listed as the key threat to 24,000 of the 28,000 species threatened with extinction on the IUCN Red List. Our freshwater supplies, both below ground aquifers and above ground resources, are being overused and polluted. The gap between the natural resources available and the rate at which they are being consumed will only increase as the world population is estimated to reach 9.7 billion by 2050. Our World in Data provides an infographic summary below, highlighting the key changes that are needed.



The global nature of the food system is also harmful to the environment, with extended supply chains and ‘food miles’ accounting for 18% of the industry’s greenhouse gas emissions. This will be exacerbated by the mass migration of people into cities: the urban population will increase to 68% by 2050. The COVID 19 pandemic and the resulting closure of borders and airspace have also highlighted the fragile nature of the global food supply chain. The interlinked issues of environmental damage, increasing food insecurity and deficits in the global supply chain have inspired agricultural technology companies to implement alternative farming techniques. One of these solutions is vertical farming, which has already been implemented globally by several different companies.


What is indoor vertical farming?


Indoor vertical farming uses technology to grow crops in a vertical shelf-like structure. The system of hydroponics and aeroponics replaces soil with water and circulates the nutrient-rich water used, which increases water efficiency up to 97% as compared to traditional farming. The controlled nature of the system also means that the crops are free from pesticides. LED lighting is used as an alternative to natural sunlight and can be manipulated to provide the optimal conditions for plant growth. The shelf-like structure of vertical farms maximizes output; the crops grown in the equivalent of a one-acre plot in a vertical farm would require 275 acres using traditional farming methods. Replacing conventional farms with vertical farms would reduce energy consumption, as well as increase global food production, which could help combat food insecurity. Vertical farms are also able to be more productive, as the controlled system, often using advanced AI techniques, optimises yields and allows crops to be harvested all year round. Locating vertical farms close to, or even within, urban centres improves the freshness of crops as the technology ensures that crops are picked at the optimal time and supply chains are as short as possible.


Urban Oasis’ vertical farm. Photograph: Agritecture


Urban Oasis – vertical farming in the heart of Stockholm


Urban Oasis, a vertical farming company in Stockholm, was started in 2017 by a group of friends who were inspired to find a way of growing food locally and sustainably. They were also motivated to develop a farming technique that would enable them to grow crops all year round, as Sweden’s short harvesting period makes it dependent on imports from Southern Europe. Urban Oasis’ farm is situated underground in Liljeholmen, in central Stockholm, and their produce is already being sold in stores. The hyper-local nature of their farm reduces transportation emissions, and has also garnered a positive response from the local community, who are excited to buy crops made right in their basements.

The hyper-local focus was therefore a good way to raise awareness, but as the Marketing Director of the company, Johanna Öhlén Meschke explains, as they expand they will need to build larger facilities, still local, but not hyper-local. When expanding to places outside of Stockholm they will place their farms close to logistic centres to minimise the use of ‘cold storage transportation’ in order to fulfil their promise to sustainability. Their vision is to “to bring healthy, affordable and sustainable food to the many people”, so their focus is not only on sustainability but also on accessibility. As Johanna Öhlén Meschke affirms, the most important goal is to make a large positive impact, which is only possible if you offer cost-competitive produce affordable to everyone.

This raises one of the limitations often raised by critics, namely the profitability of the sector. The high initial investment, high running costs and need for specialized labour, raises financial concerns for the future of vertical farming as it makes it difficult for vertical farms to compete with the price of produce from traditional farms.

Johanna Öhlén Meschke therefore explains that their new MegaFarm, which has already raised US$1.2 million in investment, is only the “middle step of their real vision”, because they need to move to an even greater scale in order to reach “price parity” with crops imported from traditional farms abroad. The new MegaFarm, which had its first harvest just this week, will also allow the company to expand to other food commodities. Currently Urban Oasis, and most vertical farming start-ups like them, are only producing leafy greens and herbs, which will not by themselves solve the increasing food insecurity in the world, limiting their calorific impact.

Being a very young industry, the whole sector is constantly learning what is feasible within the system and limits of the technology as well as what works commercially. Johanna Öhlén Meschke describes the process as a “learning journey with the customers”. The vertical farming sector is constantly evolving technologically, both within the vertical farms, as well as the suppliers, such as for LEDs, who are innovating on their part and finding ways to become even more energy efficient. Johanna Öhlén Meschke affirms that this gives hope that they will be able to expand to a wider range of produce in the future.

The company claims that in general the public’s response has been very positive. This is supported by the findings of a German study that showed 55.6% of the 482 consumers surveyed would buy produce from an in-store vertical farm, dropping slightly to 46.7% for produce from an indoor vertical farm. This represents a good base to build upon as 76.8% of the respondents had never heard of vertical farming before participating in the survey. Although the concept of growing crops without sunlight nor soil may seem alien and unnatural to people, an increasing number of people wish to eat sustainably and look for products with the ‘ecological’ label. Unfortunately, in Sweden, the regulations do not yet consider Urban Oasis’ products to be ‘ecological’, despite being sustainably grown, as they are grown in water and not soil. Johanna Öhlén Meschke explains that they are thus faced with the challenge of informing the public of their company, as well as defining their own explanations and labelling schemes to show that their products are sustainable.

Can vertical farming scale up to meet its promise?


For vertical farming to achieve its promise of low cost, local food supply to the many, it needs to scale up production in a cost-effective manner. There can be, however, serious complications when expanding from a pilot farm to a larger scale. I interviewed Tristan Fischer, CEO of Fischer Farms, to identify these issues, as his company is already in the process of expansion.


Fischer Farms started with a local pilot farm in England, similar to Urban Oasis, before expanding to their current vertical farm. Tristan Fischer explains that the company is now building one of the largest, if not the largest, vertical farm in the world, which will be completed in 18 months’ time. Tristan Fischer points out that “expansion is really difficult”, because although they rigorously try to predict issues, there are several problems that only appear once you upscale. As an example, the clay pebble balls used as a growing medium worked smoothly in their current farm, but when trialling the upscaling of this process they realised that the pebble balls elevated the electrical conductivity level for the early growth plant from the optimal level to one almost 3 times as high, causing root burn and hindering the plant’s performance. At a larger scale, the levels of dissolved oxygen in the water, needed for plants to essentially ‘breathe’, were also 3 times lower than in the earlier trials because the biological replacement of pesticides, a combination of bacteria and fungi, consumed the oxygen in the water. Both of these issues were only identified once the techniques had gone to the next scale. One way Fischer Farms is trying to anticipate scale up challenges is by trialling the key pieces of equipment they plan on using in the expanded farm in their current farm.

Tristan Fischer also explained that the main way to lower the price of their produce is not through efficiencies of scale but mainly by reducing energy consumption and the cost of electricity, which accounts for between 75% and 80% of their total costs. One option would be to use solar electricity, which in the best locations is already 10 times cheaper than buying electricity from the grid. Another would be to improve the efficiency of LED lights, suitable for use in indoor vertical farming, to the same efficiency level as LED lights already being used in housing. By simply changing these components it would become possible to build enormous food production centres on solar farms. Even though producing rice would require lowering the cost and yield base by a factor of 100, Tristan Fischer predicts that following these improvements they should be able to produce commodities, like rice, on a massive scale within the next 10-20 years and be able to feed the world. The vertical farming industry could also learn from the greenhouse industry where companies, like Sundrop Farms in Australia, are integrating solar, desalinated water and controlled growing conditions for mass production of crops.

Current relationship between traditional farms and vertical farms

As the world population grows and more people need better nutrition, there is not yet supply competition between vertical farming and traditional farming. As Tristan Fischer explains, vertical farming is also unique as it is filling a gap in the market, namely the growing of produce outside of the growing season, which is short in the UK and Sweden. This lack of tension between vertical farmers and traditional farmers was echoed in an interview carried out with local farmers in Sweden, who explain that they do not view vertical farming as a threat, as we would perhaps expect, but as a ‘complement’ to traditional farming practices. They acknowledged the limitations in conventional farming practices in the face of global food insecurity and the pressing issues related to climate change. The local farmers also clarified that advancements in vertical farming technology do not only have to represent a threat to their sector, but that they can learn from vertical farms, in the same way that vertical farms have learnt from them, and develop in tandem. It is also important to note that conventional farming practices are also becoming more environmentally friendly as the agriculture industry becomes increasingly aware of its environmental impact.

The future of vertical farming


Although the vision of many vertical farming companies is to ultimately replace conventional farming, this will only be possible once the produce from vertical farms is cheap enough to replace all produce made by conventional farms. However, as we see from the rapid reduction in cost in renewable energy, vertical farms have a good shot at achieving “price parity” in the next ten to twenty years. Investors seem to think indoor vertical farming has a bright future as AeroFarms recently announced it will go public in a SPAC transaction valued at US$1.2Bn. The increase in funds flowing into the sector will also raise consumer awareness.

Vertical farming could also unlock some other surprising environmental benefits. As vertical farms are more space efficient, we could produce food close to urban centres and therefore be able to re-wild our rural environment. This would support biodiversity, lock in precious carbon into the soil, and improve the water cycle.

It is clear that food production needs to become more sustainable and efficient in order to alleviate the environmental harms caused by traditional farming practices and to be able to feed our increasingly urban population. The extent to which vertical farming will solve these problems will depend on technological advancements and a significant investment program. ‘Gigafarms’ of the future need to primarily focus on becoming as efficient as possible in order to lower their price, because just as Fischer Farms and Urban Oasis have affirmed, sustainability goes hand in hand with accessibility; the most meaningful change is made for and by the many.


Acknowledgements

Ella would like to thank the time given by Johanna Öhlén Meschke from Urban Oasis (https://www.urbanoasisfarming.com), Tristan Fischer from Fischer Farms (https://www.fischerfarms.co.uk) and the Swedish farmers she interviewed for this article.