SUSTAINABILITY
Indoor Farming
Growth Mode CLIMATE-CONTROLLED INDOOR FARMS ARE A NE W LINK IN THE FOOD CHAIN By Lynn Petrak
he future of indoor farming, including vertical farming, has nowhere to go but up. With parallel and perhaps inevitably colliding trends of sustainability, plant-based eating, food safety and labor-saving agricultural practices, produce grown in controlled environments is likely to become much more common in grocery stores. As a testament to the sunny future of the ag tech niche, the U.S. Department of Agriculture started a new Office of Urban Agriculture and Innovative Production last year. More than $3 million in initial grants were made available through the department in 2020. Prognosticators have weighed in on a future of food that includes strategically located indoor farms throughout the country. In a report released late last year, Allied Market Research, whose Americas office is in Portland, Ore., projected that the global vertical-farming industry is expected to reach $1.38 billion by 2027, with a compound annual growth rate (CAGR) of 26.2% from 2021 to 2027. Several grocers are already buying into this type of produce supply. Earlier this year, The Kroger Co., based in Cincinnati, began sourcing fresh produce from Hamilton, Ohio-based indoor grower 80 Acres Farms for the retailer’s stores in Ohio, Indiana and Kentucky. In 2020, Kroger partnered with German startup Infarm to add modular vertical farms to two of its Quality Food Centers in the Seattle area. Also last year, Publix Super Markets said that it would invest more in hydroponic produce and added a new on-site trailer farm from a local hydroponic grower to its GreenWise Market store in the grocer’s hometown of Lakeland, Fla. Boise, Idaho-based Albertsons Cos. has collaborated with South San Francisco, Calif.-based Plenty and with Bowery Farming, based in New York, to provide its shoppers with fresh produce grown indoors. Natural and organic retailer Whole Foods Market, based in Austin, Texas, recently added a mini-farm from New York-based Farm.One to one of its Big Apple stores to provide herbs for prepared pizzas and drinks. In addition to these and other large grocery players, smaller chains and independents have teamed up with various greenhouses and growing operations near their locations. Consumers have expressed their opinions about produce grown indoors. According to the 2021 “Power of Produce” report published by Arlington, Va.-based FMI — The Food Industry Association, and conducted by San Antonio-based 210 Analytics, 43% of shoppers don’t have a preference for produce coming from indoor versus outdoor farms. Those most likely to prefer indoor growing include urbanites, consumers with above-average spend per person, members of the Generation Z age demographic, higher-income households, core value-added shoppers, organic produce buyers, and men. Those more likely to prefer outdoor-grown produce include consumers in rural areas and conventional produce buyers, the report found.
48
progressivegrocer.com
Key Takeaways More grocers have begun sourcing from or partnering with indoor-farming companies to procure fresh local produce. One of the biggest drivers of the move to produce more food in indoor-farming facilities is sustainability. Grocers can merchandise indoorfarmed produce in a creative way to distinguish their offerings and connect with shoppers.
