{"id":22215,"date":"2017-11-14T13:18:54","date_gmt":"2017-11-14T18:18:54","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/can-vertical-farming-reduce-agricultures-impact-on-climate-change\/"},"modified":"2017-11-14T13:18:54","modified_gmt":"2017-11-14T18:18:54","slug":"can-vertical-farming-reduce-agricultures-impact-on-climate-change","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/can-vertical-farming-reduce-agricultures-impact-on-climate-change\/","title":{"rendered":"CAN VERTICAL FARMING REDUCE AGRICULTURE\u2019S IMPACT ON CLIMATE CHANGE?"},"content":{"rendered":"

CLIMATE CHANGE AND AGRICULTURE<\/strong><\/span><\/p>\n

Over half of the world population lives in cities, and this figure is projected to rise to two-thirds in by the middle of this century[1]<\/a>. The rise in urbanization has distanced people food sources, increasing the length of the food supply chain[2]<\/a>.\u00a0 More consumers are become farther away food supplies, raising concerns around agriculture\u2019s impact on climate change[3]<\/a>,[4]<\/a><\/sup>, in particular:<\/p>\n

    \n
  1. Transportation<\/strong>: food supply chains are lengthening, increasing the number of food-miles[5]<\/a>, and hence, transportation emissions.<\/li>\n
  2. Water consumption<\/strong>: centrally, mass-produced agriculture exacerbates water consumption in communities near the beginning of the supply chain.<\/li>\n
  3. Preservatives and chemicals<\/strong>: for food to survive in a lengthened supply chain, preservatives are used, which can harm the environment.<\/li>\n<\/ol>\n

    Not only does mass-agriculture have a negative impact on climate change, climate change also has a negative impact on agriculture productivity.\u00a0 Rising temperatures, rainfall volatility, and pollution complicate agriculture production (see Figure 1<\/strong><\/span>).<\/p>\n

    Figure 1. Agriculture and Climate Change Negative Cycle1<\/sup><\/strong><\/span><\/p>\n

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    PLENTY<\/strong><\/span><\/p>\n

    Plenty, a San Francisco based company aims to combat agriculture\u2019s impact on climate change.\u00a0 They are testing hydroponic, indoor, vertical farming techniques that will allow for more urban food production.\u00a0 They are largely focused on producing fruits and vegetables whose perishability suffers from a long food supply chain.\u00a0 Plenty\u2019s solutions combat the above three problems in the following ways:<\/p>\n

      \n
    1. Transportation<\/strong>: Plenty shortens the food supply chain by producing food in cities where it will be consumed, reducing the need for food transportation.<\/li>\n
    2. Water consumption<\/strong>: hydroponic farms recycle water used in the production system; they use >90% less water than traditional agriculture[6]<\/a>.<\/li>\n
    3. Preservatives and chemicals<\/strong>: Plenty\u2019s model brings food production closer to food consumption, eliminating the need to use preservatives.<\/li>\n<\/ol>\n

      Figure 2. One of Plenty\u2019s Vertical Farm Growing Systems[7]<\/a><\/strong><\/span><\/p>\n

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       <\/p>\n

      GOALS <\/strong><\/span><\/p>\n

      Short-Term<\/em><\/p>\n

      Hydroponic vertical farming an urban food supply solution has been around for less than two decades, leaving a lot of room for innovation and optimization of growing systems.\u00a0 Plenty\u2019s goal in the next two years is to test, refine, and optimize growing systems to make urban vertical farming viable and economical.\u00a0 To compete with organic, local, and other premium produce products, Plenty is focusing on:<\/p>\n

        \n
      1. Product Innovation<\/strong>: Plenty is working to create tasty products that can command a price premium.<\/li>\n
      2. Business Viability<\/strong>: Plenty has a lofty goal of building a vertical farm near every large city in the world. To do this, they need to prove out vertical farming\u2019s financial sustainability.\u00a0 They\u2019re striving for high fixed asset utilization and lowered variable costs.\u00a0 To control costs for a multi-farm network, Plenty is working to create economies of scale by creating relationships with suppliers and customers that can be leveraged across a network of farms[8]<\/a>.<\/li>\n<\/ol>\n

        Medium-Term \/ Long-Term<\/em><\/p>\n

        In the medium and long-term, Plenty wants to build a vertical farm near every large city with at least 1 million residents[9]<\/a>.\u00a0 Plenty\u2019s goal is to find urban real estate just outside of large cities near food distribution networks to reduce required transit miles.<\/p>\n

         <\/p>\n

        OTHER AREAS OF FOCUS<\/strong><\/span><\/p>\n

        Consumers are less familiar with the concept of food being grown in an indoor warehouse compared to other forms of agriculture (Table 1<\/strong><\/span>).\u00a0 Even if Plenty succeeds in proving out the concept from a production innovation and cost efficiency standpoint, they will still need to generate consumer demand for their products.\u00a0 As a key innovator in this space, I recommend they take a leading role in educating the general population (especially in urban areas) about the benefits of vertical farming.\u00a0 For example, Plenty could do a roadshow to educate key potential future customers (e.g., Whole Foods) on the environmental and health benefits of vertical farming.<\/p>\n

         <\/p>\n

        Table 1. Consumer Perceptions by Production System[10]<\/a><\/strong><\/span><\/p>\n

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         <\/p>\n

        QUESTIONS<\/strong><\/span><\/p>\n

        Plenty\u2019s ambitious goal of bringing vertical farmed produce to urban areas could address many environmental concerns.\u00a0 However, several questions still remain.<\/p>\n