Vertical Farming for Supply Chain Efficiency

vertical farmingIndoor vertical farming has been around for quite some time but is starting to garner a lot more attention these days. As the world population continues to expand, so too does the amount of fruits and vegetables needed to feed the world. Generally speaking, we are not creating new farmland to accommodate the increase in fresh food required. Vertical farming can be part of the solution to this problem.

What is Vertical Farming

Vertical farming is the practice of growing crops in vertically stacked layers. Vertical farming incorporates controlled-environment agriculture, which is a fancy way of saying that it provides protection and maintains optimal growing conditions throughout the development of the crop. There are three main soilless farming techniques that are used:

  • Hydroponics: a method of growing plants without soil by instead using mineral nutrient solutions in a water solvent.
  • Aeroponics: the process of growing plants in an air or mist environment without the use of soil and with less water.
  • Aquaponics: a system that combines conventional aquaculture (raising aquatic animals in tanks) with hydroponics in a symbiotic environment.

Vertical farming can be done in a variety of different structures, from traditional greenhouses and buildings to shipping containers and tunnels. The reality is that many types of structures can be re-purposed to accommodate vertical farming infrastructure.

Why Vertical Farming

As with any new or emerging technology, there has to be a business benefit. Vertical farming has proven itself to beneficial in different way. In recent years, there have been a number of E. coli outbreaks from green, leafy vegetables. What many people may not have realized was just how the outbreak occurred. In most cases, the E. coli outbreak was related to washing practices of the vegetables. With vertical farming, this is a moot point; vertical farming is dirt-free and requires no washing of the vegetables. This alone can prevent foodborne illness outbreaks.

When it comes to farming, maximizing the yield of a crop is big money. Vertical farming can assist in achieving maximum yield in a few ways. First, vertical farming enables more harvests throughout the year. Because the farming is all done in temperature controlled, indoor environments, farmers do not have to wait for the weather to be right. Since harvests are not climate related, they can be done year-round. For some fruits and vegetables, this means having up to 30 harvests in a year rather than five or six. Farmers no longer have to wait for produce to be “in season.” Secondly, because of the control over light, humidity, and water consumption, each plant can produce more yield. There is no worry about spoilage due to weather conditions, which enables maximized production.

Sustainability is a top concern for consumers and companies alike. Vertical farming plays a significant role in sustainability efforts as well as the greater good of the earth. One such way is through reduced water usage. Because everything is monitored around the clock, farmers can make tweaks to water, light, humidity, and temperature settings throughout the process. According to recent studies, vertical farms use up to 70 percent less water than traditional farms. Additionally, given their isolated nature, pesticides and herbicides are not needed to thwart would-be pests.

Of course, there are downsides to vertical farming as well. For instance, the start-up cost to get a facility up and running is a deterrent to many would-be vertical farmers. Also, while water consumption is significantly reduced, there is still the problem of using energy to run the facility. While traditional farms rely on natural sunlight, vertical farms do not. Renewable energy sources are one way these companies can try to offset the cost and environmental impact of traditional energy.

Vertical Farming and the Supply Chain

The benefits mentioned above do not even take the supply chain into account. From a supply chain standpoint, there are two major benefits to vertical farming.

First and foremost, vertical farms are able to reduce the number of miles fresh fruits and vegetables must travel in order to reach supermarket shelves. This also reduces fuel consumption, driving down the total cost to consumers. Studies have shown that the US imports about 35 percent of the produce that lands on supermarket shelves, with the average item traveling 2,000 miles. With this distance traveled, the produce has been picked roughly two-weeks before consumers can get their hands on it. Even for domestic produce, the time and cost to ship the produce around the country is staggering. However, with a smaller footprint, vertical farms can be set up in urban areas, allowing for fresh produce to get to the shelf faster.

Secondly, as alluded to in the previous paragraph, less space is required for vertical farming. Every square meter of floor space of vertical farming produces approximately the same amount of vegetable crops as 50 square meters of conventionally worked farm land. According to a recent report by Cushman & Wakefield PLC., over the next few years, warehouse supply will outpace warehouse demand. This means that excess warehouse space could be turned in to vertical farming facilities. The use of vertical farms in densely populated places can get more fresh produce on supermarket shelves faster and could even spur home delivery to consumers. Think of it as a vertical farmshare.

Final Thought

Traditional farming is clearly not going away any time soon. In fact, if it did, the world be in a whole lot of trouble. However, as the population continues to grow, and more emphasis is put on environmental sustainability, vertical farming can help to fill that void. Whether it uses hydroponics, aeroponics, or aquaponics, vertical farms have shown the ability to eliminate foodborne illness outbreaks (especially E. coli), maximize crop yields, and reduce water consumption. From a supply chain standpoint, vertical farms are reducing the miles on our fresh produce as well as getting it on our shelves faster. The future of vertical farming looks bright, with hundred of millions of dollars pouring into start-ups that are exploring the market. It will be an interesting market to watch over the next few years.

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