Plant factories are failing, with multiple companies closing or going bankrupt in recent months. This includes the largest vertical farm on the planet, in Compton, Los Angeles. Owned by San Francisco-based startup Plenty, the farm opened in 2023 to grow salads in partnership with Walmart. It was mothballed at the end of 2024, with the company citing the rising cost of energy in California as a major problem.
Despite raising over US$1 billion (£802 million) from investors, the company's value has reportedly plummeted from US$1.9 billion to below US$15 million. It now aims to focus solely on strawberry production in Virginia.
Among the reasons for the business failures are rising energy costs; the fact that traditional farming is cheaper, making it hard to compete on price; and the fact that rising interest rates have made financing more expensive.
Together with other challenges such as high energy consumption and finding enough skilled labour, many opponents are writing this sector off as a fad that is unlikely to ever make a big impact on food security. This ignores success stories, such as JFC and Grow-up Farms, which are regular suppliers to the UK supermarkets. But more broadly, there are various reasons why the critics are likely to be wrong.
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