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The
Future
of Farming
The Challenge
Feeding the World
9.7 billion
by 2050
World population
projected to reach
By 70%
to meet this
demand
Agricultural
producti...
Environmental Risks
Drought conditions
Volatility in Supply
Climate Change Extreme Weather
Inefficient Use of Limited Resources
WaterFertilizer Agricultural Land
http://www.emeraldlawnsaustin.com/advantages-and-di...
A Costly Distribution Network
Long distance transport
Concentrated Crop Production
CA
AZ
 Inconsistent quality
 Volatili...
The Solution
Controlled Environment Agriculture
Why Now?
605 BC
The Hanging Gardens
of Babylon
1939-1945
WWII Indoor Farming
becomes commercial as
troops use hydroponics
...
1
0
TerraFarms
Local Roots' flagship farming platform
Built inside a 12 meter shipping container, the
TerraFarm reduces fo...
Proven Advantages of Indoor Farming
Unbeatable Production Metrics
Resource Efficiency
Technology-Enabled
Financeable Busin...
Unbeatable Production Metrics
365 Days per Year ANYWHERE
30-50 % Faster Growth
300x Field Production Density
100% Consiste...
Resource Efficiency
99 % Less Water Consumed
99 % Less Land Required
99 % Less Fertilizer Used
99 % Fewer Food Miles
No Pe...
Technology-Enabled
Solid State Lighting & LEDs
Robotics & Automation
Machine Learning Algorithm
Precision Control using Re...
Finance-able Business Models
Predictable Cash Flows
Minimized Operating Risk
Long-Term Contracts
Asset-Based Financing Too...
Growing Consumer Demand
Locally-Grown
Fresh & Flavorful
Healthy & Nutritious
Non-GMO
Pesticide & Herbicide Free
Stable Foo...
The Challenges and Future
in CEA
Current Challenges in CEA
High Electrical Usage
Labor Intensive in Limited Space
Limited Products
Weak Legal Regulations
W...
Labor Intensive
More Than Half of Cost
Limited Space
Vertical Structure
Intricate Processes dependent on Crops
-Planting, ...
High Electrical Usage
About 60% of Electric Cost from LED light
Environment Control Especially AC
Variability in Electrici...
Limited Products
Success in Leafy Green Production
Still Not Economical or Sustainable for
-Fruits
-Vegetables such as Cuc...
Weak Legal Regulations
Warehouses or Containers ?
-Consider Inside or Outside….ex. Sprinkler
Agricultural, Commercial, or ...
Weak Business Model
Selling “systems” instead of “produce”
-Lack of knowledge in running system
-High Initial Cost
-High R...
Future in CEA
High Electrical Usage
Labor Intensive in Limited Space
Limited Products
Weak Legal Regulations
Weak Business...
Science & Tech Developments
-CEA is Technology Enabled-
Automation
Auto Harvester, Seeder and Transplant
Remote Sensing Te...
New Business Model
-We sell food, not farms-
-We design, build, deploy, and operate farms-
-We provide a food supply chain...
New Business Model
-Not warehouse but container-
1. Low Initial Cost
2. Quick Establishment
3. Constantly Improving Design...
New Business Model
-From Contract to Harvest-
STEP 1: Execute Produce
Purchase Agreement
Farm build is initiated
Ensure si...
Farm School
Local Roots will hire a farm operation
team from your community.
This team will be invited to Local Roots
HQ f...
Thank you
Thank you
References
• "The Fertilizer Industry, World Food Supplies and the Environment," International Fertilizer Industry Associa...
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"Controlled Environment Agriculture - The Future of Food"

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Prensented byYumiko Kanke & Matt Vail of Local Roots Farms

Published in: Food
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"Controlled Environment Agriculture - The Future of Food"

  1. 1. The Future of Farming
  2. 2. The Challenge
  3. 3. Feeding the World 9.7 billion by 2050 World population projected to reach By 70% to meet this demand Agricultural production needs to increase
  4. 4. Environmental Risks Drought conditions Volatility in Supply Climate Change Extreme Weather
  5. 5. Inefficient Use of Limited Resources WaterFertilizer Agricultural Land http://www.emeraldlawnsaustin.com/advantages-and-disadvantages-of- using-organic-fertilizers/ http://agamerica.com/water-supply-system/ http://ecologic.eu/10518  Synthetic fertilizer production accounts for about 1.2% of the world’s energy (Yuan, 2014)  Nitrogen use efficiency in cereal production is only 33 % (Raun, 2003) • Up to 92% of agriculture lands relay on irrigation water in Middle East. • More than half of the lands will be under irrigation in Asia and USA by 2025 (Boutraa, 2010). • Water use efficiency ranges from 30 to 65% in irrigated land (Hamdy, 2007) • Worldwide, loss of agricultural land is significant due to urbanization. • Due to soil degradation, 3 million hectares of agricultural land are lost each year.
  6. 6. A Costly Distribution Network Long distance transport Concentrated Crop Production CA AZ  Inconsistent quality  Volatility in supply  High spoilage rates  Irregular pricing 4000 to 4500 km in U.S
  7. 7. The Solution
  8. 8. Controlled Environment Agriculture
  9. 9. Why Now? 605 BC The Hanging Gardens of Babylon 1939-1945 WWII Indoor Farming becomes commercial as troops use hydroponics to grow vegetables during the war 1980s NASA begins research on growing plants under LED lights 1450 Greenhouses are first designed and used in Korea to grow mandarins 2012 Phillips releases the industry’s first commercial Horticultural LED Light Fixture 2013 Local Roots begins intensive engineering and R&D 2015 Local Roots begins commercial scale operations with its 1st Generation TerraFarm, demonstrating industry lighting efficiency and production metrics 2017 Local Roots launches its 2nd Generation TerraFarm and begins developing sites across the U.S.
  10. 10. 1 0 TerraFarms Local Roots' flagship farming platform Built inside a 12 meter shipping container, the TerraFarm reduces food miles by growing hyper-local produce anywhere in the world. TerraFarms can be rapidly deployed and integrated throughout the food supply chain. TerraFarms provide unprecedented crop flexibility, control over the growing environment, and harvest yields. 8
  11. 11. Proven Advantages of Indoor Farming Unbeatable Production Metrics Resource Efficiency Technology-Enabled Financeable Business Models Growing Consumer Demand
  12. 12. Unbeatable Production Metrics 365 Days per Year ANYWHERE 30-50 % Faster Growth 300x Field Production Density 100% Consistency Harvest and Deliver same day One Terra Farm can produce -4,000 Heads of Lettuce Every 10 Days -250 kg of Baby Leaf Greens Every 7 Days
  13. 13. Resource Efficiency 99 % Less Water Consumed 99 % Less Land Required 99 % Less Fertilizer Used 99 % Fewer Food Miles No Pesticide or Herbicides
  14. 14. Technology-Enabled Solid State Lighting & LEDs Robotics & Automation Machine Learning Algorithm Precision Control using Remote Sensing Technology
  15. 15. Finance-able Business Models Predictable Cash Flows Minimized Operating Risk Long-Term Contracts Asset-Based Financing Tools Payback Period = 3 years
  16. 16. Growing Consumer Demand Locally-Grown Fresh & Flavorful Healthy & Nutritious Non-GMO Pesticide & Herbicide Free Stable Food Source
  17. 17. The Challenges and Future in CEA
  18. 18. Current Challenges in CEA High Electrical Usage Labor Intensive in Limited Space Limited Products Weak Legal Regulations Weak Business Model
  19. 19. Labor Intensive More Than Half of Cost Limited Space Vertical Structure Intricate Processes dependent on Crops -Planting, Transplant, Multiple Harvests -Planting, 2 Transplants, Harvest Labor 53% Electrical 27% Material 16% Packing 4% Water 0% COST ALLOCATION PER HEAD OF LETTUCE Source: Local Roots Farms in Vernon, CA
  20. 20. High Electrical Usage About 60% of Electric Cost from LED light Environment Control Especially AC Variability in Electricity Prices Depending on Locations -in Japan, $0.26/kWh = $16,000~/year/farm Comparison of Electricity Prices Utility Company Estimated Annual Cost per Farm** $/kWh in Summer $/kWh in Winter Company A $9,868.60 $0.15 $0.15 Company B $7,207.35 $0.12 $0.10 Company C $8,495.17 $0.14 $0.12 **Assuming Farm is lights on 18 hrs every day 10 kWh/ 0.5 kWh =daytime/nightime (183 kWh per day)
  21. 21. Limited Products Success in Leafy Green Production Still Not Economical or Sustainable for -Fruits -Vegetables such as Cucumber, Peppers -Herbs such as Rosemary, Tarragon, and Sage Limited Cultivar in Market -Hydroponic System https://www.linkedin.com/pulse/berry-good-marketing-sara-menker
  22. 22. Weak Legal Regulations Warehouses or Containers ? -Consider Inside or Outside….ex. Sprinkler Agricultural, Commercial, or Industrial Zoning? Hydroponics, Organic or Not Organic? U.S. Dept. of Agriculture State City County
  23. 23. Weak Business Model Selling “systems” instead of “produce” -Lack of knowledge in running system -High Initial Cost -High Running Cost -Poor Marketing Profit Position 25% Loss Position 75% Terra Farm Business Status in Japan Source: http://biz-journal.jp/2015/07/post_10898.html by Sekidou. 2015
  24. 24. Future in CEA High Electrical Usage Labor Intensive in Limited Space Limited Products Weak Legal Regulations Weak Business Model Science & Tech Developments New Business Model
  25. 25. Science & Tech Developments -CEA is Technology Enabled- Automation Auto Harvester, Seeder and Transplant Remote Sensing Technology to Monitor Plants Decision Making Based on AI Alternative energy & LED Development Everything is becoming more efficient Ex. LED Light : Before 1.4 ~1.7 umol/J, Current >2.2 umol/J Plant Science More research in photosynthesis, microbio, and cultiver
  26. 26. New Business Model -We sell food, not farms- -We design, build, deploy, and operate farms- -We provide a food supply chain solution-
  27. 27. New Business Model -Not warehouse but container- 1. Low Initial Cost 2. Quick Establishment 3. Constantly Improving Design 4. Easy to adjust crops and volume depending on customer demand
  28. 28. New Business Model -From Contract to Harvest- STEP 1: Execute Produce Purchase Agreement Farm build is initiated Ensure site prep is complete Interview & hire on site team Farm school in LA Schedule food safety audit Schedule distribution STEP 2: TerraFarms Arrive on Site Implement food safety protocols Complete food safety audits Seed first crops Order packaging Implement accounting and inventory STEP 3: First Harvest Package and send product to consumers Replant for future crops
  29. 29. Farm School Local Roots will hire a farm operation team from your community. This team will be invited to Local Roots HQ for an immersive growing experience Ongoing Training Regular webinars, growing tutorial videos, and personalized video consultation provide ongoing support for new crops and technologies On-Demand Tech Support Our Farmer Success Team is available 24/7 to provide growing, technical, sales, and distribution support New Business Model -Training & Support-
  30. 30. Thank you Thank you
  31. 31. References • "The Fertilizer Industry, World Food Supplies and the Environment," International Fertilizer Industry Association, December 1998. • Tahar Boutraa. Improvement of Water Use Efficiency in Irrigated Agriculture: A Review. Journal of Agronomy, 9:1-8.2010 • Mengyao Yuan. Managing Energy in Fertilizer Production and Usage. Stanford University, 2014 • Bill Raun . Improving Nitrogen Use Efficiency for Cereal Production. Agronomy Journal, 1998 • A. Hamdy. Water Use Efficiency in Irrigated Agriculture: An Analytical Review. International center for advanced Mediterranean agronomic studies (CIHEAM), 2005

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