Driscoll’s and Plenty are expanding their relationship to build a new indoor vertical farm dedicated exclusively to strawberries, according to a joint press release from the two operations. 

After exceeding the goals set forward for the initial stages of the partnership, the two companies are accelerating efforts to grow Driscoll’s proprietary, best-in-class flavorful berries using Plenty’s unique vertical growing platform.

This new farm, to serve consumers in the Northeastern United States, will provide fresh, consistent, high-flavor strawberries closer to berry-loving consumers who live in highly dense urban regions. This strategy will provide the fastest category growth to a mature market that has demonstrated appreciation for a high-flavor product offering. 

 “The Northeast is the largest berry consumption region in the US, with a dense population of berry-loving consumers,” said Arama Kukutai, CEO at Plenty. “Our partnership with Driscoll’s, coupled with Plenty’s optimized technology platform, ensures we can consistently grow premium berries closer to where these consumers live, providing fresh, consistent quality. We’ve successfully leveraged the expertise of the world’s largest strawberry breeding program within Plenty’s own controlled growing environment, maximizing the flavor of each berry and optimizing for both texture and size. We’re excited to bring our first indoor vertical farm dedicated to strawberries to life with the undisputed leader in the space.”

 “Over the last year Plenty has demonstrated its technological leadership in indoor vertical farming by growing our proprietary strawberries to meet the rigorous flavor and quality required of a Driscoll’s berry,” said J. Miles Reiter, Driscoll’s Chairman and CEO. “We are excited to see the initial success of our collaboration and look forward to expanding our relationship with a new farm that will drive category growth to the Northeastern part of the US.”

urban-gro (Lafeyette, Colorado) announced that it has signed an agreement to acquire Emerald Construction Management Inc. (“Emerald C.M.”), a Colorado-based construction management firm.

Bradley Nattrass, Chairman and CEO of urban-gro, commented, “The Emerald C.M. acquisition represents an important step in our strategy to supply the global indoor CEA market with turn-key design-built facilities. The market for mid-sized turnkey cultivation facilities and vertical farms is underserved, proving urban-gro a unique opportunity to bring the expertise and experience that is needed to deliver high-performance facilities.  This acquisition enables us to get our clients to market more quickly while maintaining elite service levels.” 

Christopher Cullens, CEO of Emerald C.M., concluded, “This union will provide immense value to all our CEA and non-CEA clients as they will be able to take advantage of the expertise, scale, and the complete suite of professional services that urban-gro offers. We’ve developed a strong partnership with urban-gro, and I couldn’t be more excited for both our clients and my team to experience what the combined company will offer.”

Financial details

• Emerald C.M. expects 2021 revenues of $26.5 million and adjusted EBITDA of $1.2 million.
• The total purchase price for the transaction, inclusive of a maximum $2.0 million contingent earnout, is $7.0 million.
• urban-gro will fund the transaction with a combination of $2.5 million in cash and up to $4.5 million in equity.
• The transaction is expected to close within 60 days, pending successful completion of due diligence, according to urban-gro. 

Head here for the full release from urban-gro.

© Photo courtesy of Indoor Ag Con. 

After holding the 2021 iteration last fall in Orlando, Florida, Indoor Ag Con 2022 triumphantly returned to its Sin City home this week.

 

The show that launched back in 2013 has, just like the controlled environment ag world, gone through a bit of a coming-of-age period. Attendance in Vegas was up 82% from the Orlando show with 800-plus joining the group at Caesars Forum over the two days of networking and programming.

The trade show expo floor also expanded – by 60% more booths than the Orlando show – and 77 speakers participating in 21 panel discussions and 3 CEO keynote sessions rounded out the week’s educational track.

Here’s a few tidbits from last week in Las Vegas:

Talkin’ CEA genetics

One of the areas in CEA that has sort of lagged behind the development curve that has accelerated innovations in LED lighting and climate control is on the seed genetics side. While seed breeders have been releasing field varieties and even greenhouse-specific cultivars to the market for decades now, there hasn’t been the same level of resource investment in getting CEA-specific varieties into the hands of indoor farmers.

Rather, for much of CEAs existence, growers are having to pick and choose varieties bred in other production systems and trial them in their own setups. Obviously, it would be ideal if there were varieties that have already been trialed in commercial indoor and vertical farming production systems at the breeder level.  

Enter Dr. John Purcell and his team at Unfold Bio, which is Bayer’s vertical farming seed spinoff business which launched in 2020 via a joint venture with Singapore-based investment firm Temasack. I had the chance to catch up with Purcell in Las Vegas to discuss where the effort stands today.

“What we recognized (at Unfold) and I think the market recognized is that, when you have these incredible growing systems that are really unique and distinct and you’re moving toward protected culture in a way that controls every aspect of the environment, you’re going to need seeds that have been developed for that,” Purcell told me. “You’re going to need testing and trialing and breeding data to actually find ways to produce solutions that address the challenges indoor farmers are facing.”

Now about 18 months into Unfolds journey, the seed startup launched its Innovation Partner Program at the show.

“What that’s about is, when you think about any grower, they need to have data around ‘How will that seed work in my system,’ right,” he explained. “Now, some of that they do want to handle internally, but it’s much better if the seed company can come in and give them (some of) that data. You can be very transactional in the seed business, but this program is looking for a little deeper relationship where we can share all that data on how our varieties are performing, and then we can really build on that relationship by having the growers really inform us of how we run our (seed) program.”

Currently, Purcell shared, Unfold has five crops in it’s CEA seed portfolio – lettuce, spinach, tomato, peppers and cucumbers. He says that two of the most important genetic traits CEA cultivars should feature are fast maturity rates and uniformity for ease of mechanical harvesting.

With most of the market focusing on microgreens indoors – and for good reason, they feature fast cropping times and easy to deal with plant architecture – Purcell thinks CEA must make the leap to fruiting crops to take the industry to the next level.

“For us and for the industry to really take advantage of all the great investments that have been made, we’ve got to make the leap to fruiting crops,” he said. “And berries, that’s the other one. You think about tomatoes and berries, sometime you experience these amazing tasting strawberries and tomatoes, and then other times they look the exact same but the Brix aren’t there, it’s not as tasty as you’d like it. With vertical controlling that environment and having that consistency year-round, we can really deliver a consistency in the supply chain, and that’s huge!”

Talkin’ knowledge transfer

urban-gro is a Colorado-based CEA design firm with experience in over 500 CEA facilities already under its belt. Of course, having launched in legal cannabis’ hot bed, much of the group’s experience is in that crop, but they’re moving into the CEA produce space with the same commitment to highly efficient, fully integrated indoor production facilities.

“I think what separates us is our IP – which is our people – we have close to 100 employees and two-thirds of our people are architects, interior designers, a variety of different engineers, plant scientists, and horticulturalists,” Brad Nuttras, CEO, told me.

Nuttras says urban-gro is coming off some really good years in the cannabis space, and for the last year-and-a-half the company has been rolling out it’s indoor food vertical farming play. It’s all about using that knowledge and know-how that they’ve built up working in legal cannabis and expand that into CEA.

“In an indoor facility, regardless of the crop, the only difference is the logistics – how they move the crop around,” Nuttras explained. “It’s all basically the same Dutch-based environmental control systems and LEDs.”

Right now, the company offers full construction document services for growers, and the hope is to soon acquire a construction management company that will enable urban-gro to add in the design and build pieces to the puzzle.

“So, whereas large greenhouse growers have to go to Europe or go to one of these huge design-build firms in the U.S. that is focused on indoor and also greenhouse, we’re going to be setup to target those 20,000-50,000 square foot facilities regardless of crop-type,” Nuttras shared.

The firm recently made some headway in that regard in Europe, where Nattrass says they signed a deal in Q4 to design and build out up to 20 indoor vertical farms throughout Europe. He warns that the facilities “won’t be an AppHarvest or anything like that” but instead will be smaller footprint facilities located near or even in food service, hotels, and restaurants close to urban population centers.

“The next stage for us is just to continue to grow with acquisitions and just continue building out our team,” Nattrass said. “Now being listed on the NASDAQ and being able to offer our employees stock options and things like that, it’s really helped us to retain all of our talent, which, again, is our differentiation point.”

A fertility warning

Just days before we headed to the desert for Indoor Ag Con, the world watched in horror as Russian forces invaded nearby democracy Ukraine. With agriculture being such a globalized marketplace in the 21^st century, there was sure to be some talk at the show about the conflict and how it will likely destabilize a region that both grows and exports a ton of row crops to the rest of the world, as well as supplying farming and energy inputs globally to agriculture markets.

Speaking on background with one of the fertilizer reps in attendance, the rep cautioned that the situation in Eastern Europe – along with the trade-blocking sanctions put in place by NATO countries to punish the Russian aggression – could make sourcing fertilizer later this season more difficult than usual for North American growers. And they shared that goes for N, P, and K across the board, as well as some micros that are sourced throughout the Baltic states as well.

His advice? The same thing you likely heard during the COVID-19 shutdown and subsequent supply chain disruptions: get in contact with your fertilizer rep today and find out how they plan on managing the situation, and if they do foresee problems with sourcing later on in the season. If so, it might be time to start looking at other options here domestically in North America.

Just one more thing to think about as you round into the spring production season, I suppose…

Some cool stuff

Of course, no conference experience is complete without a swing around the trade expo floor. Here’s a few products being shown in Vegas last week that I found intriguing:

1.      Agnetix water-cooled PHENOM vertical farming lighting system: According to the company, the PHENOM platform (launched in November 2021) includes integrated plant health sensors, canopy imaging technologies, the patented Agnetix liquid cooled hydronics system, and a computer-vision platform allowing the user to interface remotely. And the company says that the industry benchmark efficiency of the Agnetix system can deliver close-proximity 100% PAR light (photosynthetically active radiation) to multi-level grows with luminaire wattage of 375 and an astonishing PPE (photosynthetic photon efficacy) of up to 3.61µmol/J and precision dimming 100-1%. It’s one of the smallest footprint LED fixtures I’ve ever witnessed in person, which would make sense since growing vertically is a play to capture and use every single inch of space for plant production. You can learn more about PHENOM here: https://agnetix.com/product/phenom/

2.      Ceres Certifications International was showing its in-house produce testing equipment at the show. Growers can purchase and setup a testing lab in their own operation, giving them the option to pre-test harvested produce for residues, contaminants, etc., prior to sending it out to a third-party lab for food safety audits. Additionally, by testing produce in-house, the grower builds and maintains ownership over their testing data. According to representatives at the show, the FDA is encouraged by operations that take proactive steps to resolve food safety issues before they make it into the food system. For more information on Ceres, head here: https://www.ceresci.com/

3.      Cherry Creek’s Echo hanging basket irrigation system: This product would likely be a good fit for our friends over on the greenhouse ornamental side, but it’s also a fit in the indoor produce world as vegetable hanging basket planters have been trending a bit in recent years. Although the system is only new to me (it’s been on the market for 25 years-plus according to the company), Cherry Creek recently added what its calling the new REVERBTM touch screen PLC controller, which can manage up to 16 Echo systems from one central controller. If you’re doing hanging basket production indoors, it seems like this system would be a great way to ensure uniform watering throughout production. More info here: https://cherrycreeksystems.com/echo/

4.      Percival Scientific’s SciBrite 8-color independently dimmable LEDs: As someone who tries to stay up on all the latest in the rapidly changing horticultural LED world, I must admit that Percival Scientific was a new name to me. According to the company, unparalleled lighting uniformity across PAR ranges, evenly mixed colors/spectrums and superior spectral control via it’s eight-color configuration capabilities make this reportedly first-of-its-kind colored LED lighting system a game changer over systems using linear arrangements of diodes. The group was also showing it’s research-grade automated plant growth chambers at the show. More information here: https://www.percival-scientific.com/product-category/scibrite-led-series/

5.      GrowRebates.com: The guys at GrowRebates.com weren’t showing any particular product at the show, but I felt they should be included here after noticing the many representatives of local municipal utility providers were present at the show. Clearly, incentivizing the use of more efficient and sustainable technologies throughout the indoor farming space is an important undertaking for growers and regulators alike. The guys at GrowRebates.com offer consulting services to growers to ensure they are capturing all rebates and incentives available to them, and it’s not just with LED lighting, either. They can also help you find rebates around your HVAC and dehumidifying technologies, as well. Visit GrowRebates.com or give them a call at 855.LED.GROW to learn more.

Indoor Ag Con 2023 is set to take place February 27-28 in Las Vegas, Nevada, at Caesars Forum once again. Visit Indoor.Ag throughout the year for agenda updates and more. 

Indoor Ag Con made its triumphant return to the sun-splashed Caesars Forum on Monday as the all-things-CEA conference co-located alongside the retail-focused National Grocers Association annual meeting in Las Vegas, Nevada.

Opening the two-days of meetings, educational sessions, and trade booth visits was a keynote address from two Steves, Steve Platt (the CEO of BrightFarms) and Steven Bradley (VP of Cox Enterprises Cleantech division, which recently acquired a majority ownership stake in BrightFarms). The two groups are working in collaboration to “transform CEA together.” 

© Photo courtesy of Indoor Ag Con/Suzanne Pruitt

“Agriculture today is a supply chain that is just toxic in so many ways,” Platt told the gathered crowd of controlled environment growers, ancillary service providers, and manufacturer reps. “It uses too much energy and oil to send crops halfway across the country, and it’s using too many pesticides and chemicals that consumers do not want in their food.”

Platt says that the recent focus on indoor produce production in the U.S. – one of the ongoing themes of the week is that we have yet to so much as scratch the surface when it comes to realizing the top-end potential of CEA production on a massive nationwide scale here in the States – has still been a win-win-win for everybody involved.

“It’s a win for the consumer who gets local, cleanly grown produce year-round, it’s a win for retailers looking for a steady, consistent supply of premium product to fill their shelves, and it’s a win for the environment and society at-large,” he explained.

Noting that BrightFarms plans to add 60 acres of greenhouse produce production to its already sizable operational footprint over the next three years, Platt drew a laugh and many knowing nods from the crowd when he blew the doors off of what he calls “CEAs dark, deep secret.”

“This shit is really hard!”

Indeed, it is, Steve. Indeed, it is.

© Photo courtesy of Indoor Ag Con/Suzanne Pruitt. 

IPM learnings

The day’s first educational session dealt with what a successful IPM program should look like. According to panelist Justin Leavitt with Biobee USA, “IPM is all about using every single tool that you have at your disposal.”

“You can’t just spray or clean your way out of pest issues,” he added.

Another tenet he typically shares with growers when helping them setup IPM protocols is that your IPM program should never be considered final. It should be a living, breathing, constantly evolving aspect of your operation.

“I love a good IPM program on an Excel spreadsheet, but that spreadsheet better be editable because I guarantee you will have to make adjustments to even the most dialed-in program,” he shared.

Erika Verrier, horticulturalist with iUNU, concurs. Leavitt’s fellow panelist says that she has never come across a successful “one-size-fits-all” IPM program. She advises those that work with growers on implementing IPM actively manage the growers’ expectations throughout the process.

“Make sure that they understand that the IPM program at their greenhouse might not end up looking exactly like another growers’ IPM program that they saw that grower have success with.”

What LED lighting specs should I actually care about?

Anyone who’s ever comparison-shopped LED grow lights knows first-hand how convoluted a LED technology spec label can be. One would guess that’s exactly why Indoor Ag Con had a panel breaking down what specs should be most important to CEA growers on an LED spec sheet.

According to Dr. Ed Stoneham, co-founder XtremeLUX, the LED fixture’s photon efficiency, and that efficiency measured at various operating outputs, is first and foremost among characteristics to weigh.

“Most fixtures have variable outputs, so most of the time you’ll be running lights at lower levels of actual output (vs. 100% output), which is exactly why it is so important to ask lighting manufacturers their lights’ photon efficiency at different lighting levels/intensities,” Dr. Stoneham explained.

The other important metric to evaluate is the spectral quality and quantity of the light, because it’s “very important that you make the best use of every single photon you’re getting from those lights,” Stoneham says. The ability to adjust your lighting spectrum to account for different growth stages in various indoor crops, aka spectrum versatility, is important so that the grower can “control and manipulate” those spectrums over time,” he says.

Blake Lange, business development manager with Signify, also participated in the lighting panel. For Lange, everything that is listed on that lighting spec sheet is critically important, but one metric he advises growers take a long hard look at is the fixture and its component’s lifetime rating. “I want to know how long that light is going to last in my growing environment,” he explains.

The panel agreed that, for greenhouse operations using LEDs supplementally, it’s is very important to have some type of dimming capabilities, whether analog or digital, so that growers can adjust based on the amount of DLI they’re already getting from the sun and, in a perfect world, save on their energy bill.

A plea for advocacy

After the morning’s educational tracks wrapped up, the day’s keynote was delivered by AppHarvest founder & CEO, Jonathan Webb, a man who is quickly becoming the face of CEA in the U.S., whether he likes it or not.

Webb delivered a high energy, some-would-say perfectly pitched plea to his industry cohorts that they need – no, they must – do more to push indoor farming’s profile as environmentally sound vs. field grown crops higher among consumers and legislators alike.

“We’re in the infancy of this whole CEA deal right now,” Webb explained. “I know we like to think we’re all really cool, that we’ve raised all of this capital and accomplished so much already, but really we’re just kind of (the) cute (underdog) as we sit here in this room today. We need to get a whole lot louder.”

Operating capital remains extremely important to the industry as a whole – after all, you can’t farm without money for inputs, land, the list goes on and on – but don’t just think a bunch of VC angel investors are going to bankroll the entire future of this industry. We need government-funded incentives and grants just as much as our field-farming compatriots. Heck, maybe even more…

“The VC dollars are not going to be enough,” Webb cautioned. “Sure, it helped us launch this industry, but if we want to take this thing to the next level we need a built out infrastructure behind us, and that’s where the government comes in. VCs don’t build infrastructure.”

Webb worries that CEA cannot advance beyond the current regional hub-and-spoke business model, where disparate independent farms serve regional markets and never really venture much further out than that.

“I don’t know what else this industry can do honestly, without help from the government and even regulators,” he says, imploring indoor growers to get active with their local reps in Congress. “We have to engage with D.C., there has never been a single industry in the U.S. that has taken off that has done it without any regulation or government incentives.”

The Farm Bill, for instance, has close to zero implications in the indoor farming world. Think about that for a second and let me know if that doesn’t enrage you as much as it enrages Webb.

“This is bulls@%$,” Webb growled. “There’s a trillion-dollar Farm Bill in this country and we don’t see a single dime from it … I mean, what the flip?!”

His closing message for growers that want to help grow CEA beyond what we have already today? Get active: “share your stories, invite local lawmakers and regulators to your farm and get them involved in the conversation.”

Why do vertical farms fail?

One of the afternoon’s educational sessions looked at why some vertical farming operations thrive, and why some fall by the wayside.

Dr. Robert Colangelo, founder of Green Sense Farms and a 12 year CEA industry veteran, shared his six reasons that vertical farming operations fail (thus, these are pratfalls you’ll want to avoid as an indoor farmer):

1. Undercapitalized operations. Simply stated, it costs a lot of money to produce a commercial CEA crop. Understand that going in.
2. Poor business models. Make sure you understand your market, your crop’s cost of production in your growing system, your customer, and the ins-and-outs of your production model before you start building.
3. Inexperienced management teams. This is probably more common than most think in an industry that is barely over a decade old, Colangelo says.
4. Investing in unproven technologies that do not deliver results for the farm.
5. Lack of sales.
6. A refusal or failure to pivot.