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Sunday Wrap-Up: A Bearish 2023 Lies Ahead For Indoor Farming?
Every Sunday, discover a free recap of the week in the world of indoor farming.
This edition is sponsored by AgriHub & AmplifiedAg.
Good morning readers, since last Friday, two vertical farming companies have stopped activities and many indoor farming companies have entered restructuring programs in the hopes of decreasing their cash burn rate and becoming profitable.
Nonetheless, greenhouses appear to be in better shape, with the opening of new facilities and the signing of new partnerships.
This Week’s Editorial:
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Indoor Farming Stock Performance This Week
Indoor Farming publicly-traded companies have had contrasting weeks, while some companies’ stock went up others continued their downfall.
The first company, AppHarvest hasn’t progressed in the last 5 trading days trading at USD 1.90 a share at closing on November 3rd compared to USD 1.91 a share at the opening on Friday 28th October. Nonetheless, the company announced the opening of its 3rd CEA facility in Somerset, Ky. set to grow strawberries and cucumbers. They also started distributing their harvests to distributors. They now operate about 165 acres of CEA facility as the company starts the planning of their 4th farm in Richmond expected to be operational by year-end. The growth should’ve sent the shares up but perhaps traders are awaiting the results of the company to be published on November 7th and whether the company will be able to build on its previous quarter's performance and progress.
Next, Local Bounti lost 9.52% in its stock performance over the past 5 trading days closing at USD 2.66 a share on November 3rd. The company announced the second closing of its planned share issues following the PIPE financing agreement where proceeds will be used for general corporate purposes. Similarly to AppHarvest, the company will publish its results on November 10th where investors will be looking at the progress the company had in its Earnings per Share as well as revenue performance.
Finally, Edible Garden Ag continues its downfall losing 20.52% of its value over the past 5 trading days now trading at USD 0.52 a share. The company will release its financial results on November 10th which will determine the future of the company as a listed company.
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This Week in Indoor Farming
The current macroeconomic trend is affecting the financial performance of most indoor farming facilities. While greenhouses appear to be less affected, vertical farms throughout the world are incurring increased losses and a number of companies were forced to cease all activities.
Earlier this week, Netherland-based company Glowfarms announced ceasing its activities after an ultimate funding round failure as reported by Vertical Farm daily’s Rebekka Boekhout. The company stated that ‘external pressures’ linked to the macroeconomic environment (raising energy costs) have overtaken the team at Glowfarms as they couldn’t find sufficient funds to survive for the foreseeable future. Last weekend, news spread that Pittsburgh-based Fifth Season shut down and even if we can suspect the macroeconomic pressure led to the closing of the business on Friday as reported by bizjounral.com, no official reasons were communicated by management.
These two companies join another vertical farming company failure, French-based Agricool earlier this year even if the latter was then bought back by VIF systems. Another indoor farming company, Plantise has also announced ceasing its operations in the Netherlands as the company expected unbearable energy costs and an increase in wages and minimum wages.
The entire industry is affected by the current market conditions as illustrated by the recent layoffs initiated by leading companies, InFarm, CubicFarms, or Iron-Ox as they envision becoming cash flow positive/break-even. Another company, Kalera PLC KAL 0.00 has had to divest some of its assets in order to accelerate its path to profitability and is now under threat of being de-listed from NASDAQ.
The MIGAL Galilee Research Institute (MIGAL), a regional mega-R&D center supported by Israel’s Ministry of Science and Technology, announced that its researchers have more than quadrupled the postharvest life of cucumbers – from two to nine weeks – using a “smart” sequential treatment protocol suggested by its innovative AI (Artificial Intelligence)-based algorithms.
The study, “Algorithmically-guided postharvest protocols by experimental combinatorial optimization,” was carried out over 18 months by MIGAL’s Postharvest Innovation Center under the leadership of Prof. Ofer Shir, an Associate Professor of Computer Science at MIGAL and Tel-Hai College, and Dr. Dan Gamrasni, Postharvest Research Associate at MIGAL and Tel-Hai College.
The MIGAL team’s algorithms used an AI system to investigate the combinatorial search space of postharvest cucumber treatment models, learning the fruit’s response to variations in timings, ordering, and activation levels of certain operations. At the end of the process, a single multi-stage treatment protocol was selected for testing in MIGAL’s fields and laboratories.
The product selected for the experiment was the cucumber, a sensitive fruit with a high wastage rate due to its average postharvest storage lifespan of fewer than two weeks. Immediately after harvest, the fresh cucumbers were transported to the laboratory, weighed, treated using the protocol suggested by the AI system, and stored for four weeks in accordance with the AI protocol. At the end of this period, it was determined that the fruit’s weight, color, crispness, and other qualities had undergone minimal change, and the cucumbers were stored again for an additional 5 weeks.
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