2021 saw Covid-19 and Brexit bringing chaos to the food system, creating a sense of urgency to develop automated solutions that will make supply chains more efficient, sustainable, localised and less wasteful. It would be too premature to confine problems such as empty supermarket shelves and labour shortages to the past, as both issues continue to have a big impact on the agribusiness industry. There are also the ongoing global challenges of feeding an ever-expanding population while battling the climate crisis. With all these issues in mind, it is safe to say that the obstacles facing the agribusiness industry in 2022 are not too far removed from those in 2021. In its second article looking at industry trends, AgriTech specialist Light Science Technologies unveils what will be hot property in the sector this year.
- The spotlight on sustainability
As COP26 illustrated, the devastating environmental threat to the planet is looming large. The overriding need is to create an alternative, sustainable solution to how we grow our food and feed the world, forcing an upheaval of the current food system. Supply chain disruption is also creating a hotbed of innovation in the agricultural sector thanks to green, disruptive tech. More consumers too are opting for healthier lifestyles, as cleaner, plant-based diets become more popular. Shubhang Shankar of Syngenta Group Ventures believes innovation will move toward producing food sustainably, rather than cheaply, as initiatives and conversations about repairing the environment become increasingly important.
This comes as the UK is making its global mark as a rapid developer in AgTech and the recent news that London has been declared as having the best sustainability standards in the world, thanks to its ‘vibrant’ green finance sector that is at the cutting edge of developing new financial products to combat climate change. The capital, which has overtaken Amsterdam, was propelled to the top of the list by the government implementing measures to stimulate Britain’s green finance sector.
- Investment in AgriTech
AgriTech – or AgTech – is now the buzzword in investor circles. Seven years ago, almost no one knew what AgriTech actually was. Venture capital firm AgFunder reported 2021 Agrifood tech investments raised $24 billion globally in the first half of last year, a new record.
Announced in July 2021, the Government’s Innovation Strategy pledged to increase investment in R&D to target domestic priorities including tackling climate change and boosting productivity. This also coincided with the National Food Strategy’s independent review where it stated its desire to see money “spent on projects that make the food system better in practice, rather than simply on new ideas” and “should also be used to help develop new ways of growing food, such as vertical farming and precision fermentation.”
As far as investors are concerned, there’s never been a better time to invest and the sector is rich in opportunity. 2022 has started off strongly, as seen with Plenty Unlimited Inc. securing $400 million in a Series E financing round, the largest investment to date for an indoor farming company, and also Vertical Future, which has raised £21 million in a Series A round, hailed as the largest Series A round to ever reach European shores in the CEA space.
Little surprise then that investment and funding in AgriTech are set to boom in 2022, given the rapid rates of growth in the sector and wider market opportunities which will become available.
Efficient grow lighting solutions
Expected soaring energy costs this year will impact on everyone, not least farmers and growers. A switch to LED lighting for indoor farming can offer a more cost-efficient solution in the long-term, with a report on LEDs for Energy Efficient Greenhouse Lighting finding that LEDs can potentially be a far more energy efficient light source than some traditional options, saving 10-25% of total greenhouse energy demand and 40% less energy consumption. As well as ticking the box for sustainability, LED grow lights also offer increased durability and and longer lifespan whilst delivering a measurable return on the initial investment. In fact, research and studies have found that LED grow lights are the most cost and energy efficient solution for indoor tomato growing, compared with HPS grow lights, which rely on significantly heavier energy usage. Choosing the right light layout and design is also conducive to reduced energy usage and achieving the best possible results, so that growers can reap the benefits of LED lighting both financially and environmentally.
- Sensor technology advancements
The need for a more sustainable, automated, connected, efficient, and predictable crop production with less waste and better quality is fuelling a growing trend in smart farming. This has been reflected in rapid developments in sensor technology and data-driven solutions, which have contributed to huge growth in the global smart farming market, valued at around US $7 billion and expected to increase to US $24.76 billion by 2027. The latest sensor technology is helping indoor growers obtain the data they need to make decisions and help solve problems for improved crop yield, enabling better management and control of their closed environment. The key metrics collected can help assess crops and manage important elements such as nutrient deficiencies, indicators of disease for prevention, light intensity and climate control.
Consumer behaviour is changing as more people become smarter and serious about sustainability. The source, method, quality and delivery of food are criteria which are now very much part of grower as well as purchaser decision making. However, it appears that with a few companies at least, all isn’t what it seems with their purported green ethos in influencing these choices. True brand authenticity means not just promoting green but also practicing green, leading to some businesses being accused of greenwashing. Although technology is forcing transparency, “we have to act holistically and look at all system boundaries because we live on a planet with limited resources. As long as industry can buy its way out and advertise that it is “climate neutral” instead of reducing CO2, nothing will change . . . the greatest leverage lies with industry, which is not yet properly incentivised by the politicians”, according to Agrilution CEO and Founder Max Loessl. This is why 2022 offers the ideal opportunity to further raise awareness of CEA practices and technologies which offer a viable, sustainable alternative to traditional farming and show that the CEA industry harnesses proven tech for good.