“Responding to consumers’ wishes to make the most of vertical farming opportunities”

Vertical farming projects are popping up like mushrooms all over the world. Signify and the BASF Vegetable Seeds Business are fully involved in such projects. In a history of Dutch Greenhouse Delta, they emphasize that it is particularly important to tailor a vertical farming project as much as possible to the consumer’s wishes and needs. Both parties are looking at how they can strengthen each other in this. The development of specific seeds for vertical farming projects is the ideal dot on the horizon. They see a key role for the Dutch Greenhouse Delta in the establishment of new coalitions and partnerships that can promote vertical farming projects.

The Philips GrowWise research center at the High Tech Campus in Eindhoven is the beating heart of Signify’s vertical farming activities. LED light recipes and cultivation systems are tested here in different climate chambers for cultivation without daylight in closed environments. Aspects such as taste, ingredients and durability are examined here. “We’re seeing more and more interest in vertical farming,” says Ellis Janssen, Global Director City Farming at Signify. The City Farming division is part of the company’s HortiCulture LED Solutions business unit, which specializes in LED lighting. “No wonder: cultivation in a controlled environment has many advantages. It allows you to grow where it is ultimately consumed, which means you have far fewer food kilometers. Because the cultivation takes place in a closed system, plays diseases don’t play a role, so you can grow cleaner.”

In addition, according to Anne Jancic, Global Segment Manager City Farming at Signify, vertical farming offers the ‘luxury’ of being able to focus on what the next party in the chain needs or wants. “Since there are no outside influences, you can fully control the climate. In this way, a manufacturer can make exactly the product that the consumer or the next party in the chain wants. For example, you can focus very specifically on taste, ingredients, durability or color. We are also adapting our light and growing recipes for vertical farming accordingly.”

Management of consumer wishes
Carel Vereijken, Manager Consumer and Market Insights at BASF’s Vegetable Seeds Business emphasizes that consumer wishes are becoming increasingly important. In any kind of agriculture. “Consumer demand is becoming increasingly diverse. That’s why you need to know in advance exactly what you want to offer.”

In general, it is more expensive to produce in a vertical farm than in the open, he says. These higher costs can be seen as a temporary disadvantage, because if we gain more knowledge and further professionalize the cultivation, the cost price will be lower, especially if you look at the actual costs, because healthier food means less health costs.

Nevertheless, there is still a great need to achieve a good margin. “That can only be done if you deliver exactly what the consumer wants, and you also know that he is willing to pay a little more. And with vertical farming, it is possible to focus the entire system on the production of a particular vegetable. So you have to know very well what you want to produce.”

Insight into the wishes of consumers and chain partners
Nevertheless, Signify notes that investors in vertical farming projects often do not yet have a clear picture of their customers’ desires. ”While your customers and their wishes – for example in relation to taste, durability and weight – determine how best to set up a vertical farm. Slowly but surely, a movement is being set in motion in this regard, but there is still a world to gain”, says Janssen.

Gaining insight into what consumers and supply chains around the world need is what the Market and Consumer Insights team in /BASF’s Vegetable Seeds Business, which sells vegetable seeds under the Nunhems brand, focuses on. “As a company, we can supply plants that are resistant to certain diseases and produce seeds that a grower can easily handle – for example because there is a high yield, says Carel Vereijken, but taste is also an important argument for the consumer. purchase of fruit and vegetables. But in vertical farming projects, there is almost no investment in taste, while there are many opportunities here.”

According to Vereijken, taste preferences differ from culture to culture, and it also depends on what people have come to know. “A product such as bitter gourd is particularly well known in India. People are used to it and eat it regularly, also because it is claimed that this product has a positive effect on health. However, this vegetable is very bitter and people from other countries are less used to this taste. Another striking example is the tomato in Italy. The tomato is the basis of Italian cuisine. This makes the exact taste and aroma of a tomato very important to Italian consumers. For the Dutch, it is also important how a tomato tastes, but they are usually less picky.”

Seek cooperation
Signify and BASF’s Vegetable Seeds Business will collaborate more intensively in order to better meet the wishes of consumers and chain partners. This must help to optimally exploit the possibilities of vertical farming. “Consider, for example, the specific development of vegetable seeds and easy recipes for vertical farming,” says Vereijken. “For example, we can grow seeds that require more or less water to optimally match the local conditions. But above all, we want to market seeds that meet consumers’ taste and health needs. In order to bring out certain properties – for example a high vitamin C content – you must, among other things, use the right light and cultivation recipe. BASF and Signify will reinforce each other in this.”

Anne Jancic indicates that specific seeds are already being selected for vertical farming projects, but breeding is not yet focused on this. “That is our dream; that this way of growing is so great that special seeds are grown for it. And if the right properties are in a seed, we have the buttons to extract them with our easy recipes. Research in our Philips GrowWise research center has also shown that things like light spectra, intensity and uniformity play a decisive role in growing fruit and vegetables with specific characteristics. This is very attractive because it also allows for the introduction of distinctive products that create extra shelf space.”

Vereijken adds that it is not only the characteristics of the seed and the easy recipe that determine the final product. “Of course, other factors also play a role. Think, for example, of substrate, nutrition, cultivation period, etc. It is an overall picture.”

Global growth potential
Currently, the percentage of vegetables grown worldwide in daylight-free cultivation is still limited; According to Signify, it is estimated that this is a few percent of the total vegetable production. The company clearly sees growth potential for vertical farming. Especially because the need for food security and self-sufficiency has grown significantly, especially since corona. According to Janssen, the Gulf region in particular is an extremely interesting area for vertical farming. “Due to the hot, dry climate, it is impossible to grow food here in a greenhouse or in an open field. In addition, residents of the Gulf region are, on average, affluent and willing to pay for healthy and sustainable food. Health is really a theme.”

In addition, in the Gulf it is possible to generate all the necessary energy with the help of the sun. “And the lack of water is not a problem with vertical farming either, as you can easily reuse water and is therefore extremely sustainable.”

The first projects are already being built. For example, Signify and Certhon are involved in the Madar Farms project in the port area of ​​Abu Dhabi. This indoor farm with an area of ​​50,000 m² focuses on the cultivation of tomatoes and microcress.

Many vertical farming projects are also being established in the United States. It has everything to do with large quantities of food having to be transported here over long distances. “This means a loss of taste and freshness and is anything but sustainable. Fewer and fewer Americans accept this, and they also place great value on a locally produced product. The number of vertical farming projects in the United States will therefore undoubtedly continue to grow in the coming years; we are, among other things, involved in the recognized 80 Acres project in Ohio. In addition, there is increasing interest in this way of growing from Europe and various Asian countries.”

Anne Jancic adds that it is also an important advantage that vertical farms can produce very cleanly and safely. While consumers in North-West Europe generally have no doubt that the food on the shelves is healthy and safe, the Japanese, for example, are less sure. “In Japan, consumers are also really concerned about the safety of their food. They fear that vegetables from, for example, outdoor cultivation contain pesticides or are even contaminated. Growing in vertical farms largely eliminates these concerns. This is an important reason why many vertical farming projects are being established in Japan.”

Bump to take
Despite the mentioned advantages, according to those involved, there are also the necessary obstacles to overcome in order to exploit the opportunities of vertical farming. For example, the costs of vertical farming projects must be reduced, emphasizes Janssen. “This way of growing is now even more expensive than growing in a greenhouse. To make vertical farming more interesting, it is important to reduce the overall system costs. This can be done by better integrating the various components – air conditioning, lighting, etc. But increasing production further to reduce costs per product unit is also an option.”

According to Anne Jancic, it would be good to make better use of the synergies between greenhouse horticulture and vertical farming. “Glass gardeners can, for example, cultivate very efficiently; promoters of vertical farming projects can learn from this. On the other hand, greenhouse horticulture can also learn things from vertical farming; for example in relation to raising capital.”

The employment supply in vertical farming projects is another matter. Because although automation is easier with this way of growing, knowledge and experience are still needed. “Such projects require people who know something about cultivation, but who can also combine it with technology and know how the two things can influence each other. There are still too few people who have this expertise in-house. There is also a challenge there.”

More cakes to share
According to Jancic, there is also a lack of standardization when it comes to setting up vertical farms. “On the one hand, there are companies that build and develop everything themselves, on the other hand, you also see parties that integrate all kinds of existing systems to realize their business. A party like Dutch Greenhouse Delta, in which Signify is also a partner, helps to realize more cooperation and unity and thus accelerate the progress of vertical farming. After all, if everyone starts reinventing the wheel themselves, it slows down progress. In addition, DGD can play a key role in opening doors for governments, investors and retail to realize vertical farming projects.”

According to the Signify expert, the Dutch Greenhouse Delta can also play a role in raising awareness of the possibilities of vertical farming. “There is a lot to win. And there is not one cake to share, but several. By working together, we can take advantage of these opportunities better and faster.”

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