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The future of food: Why farming is moving indoors

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The future of food: Why farming is moving indoors

A car park opposite the infamous New York City housing estate where rapper Jay-Z grew up seems an unlikely place for an agricultural revolution.

Ten shipping containers dominate a corner of the Brooklyn parking area, each full of climate control tech, growing herbs that are distributed to local stores on bicycles. This is urban farming at its most literal.

The containers are owned by Square Roots, part of America's fast-expanding vertical farming industry, a sector run by many tech entrepreneurs who believe food production is ripe for disruption.

The world's best basil reputedly comes from Genoa, Italy. Square Roots grows Genovese seeds in a container that recreates the city's daylight hours, humidity, Co2 levels - and all fed hydroponically in nutrient-rich water.

"Rather than ship food across the world, we ship the climate data and feed it into our operating system," says co-founder Tobias Peggs.

High costs

An artificial intelligence expert, Mr Peggs founded Square Roots with investor Kimball Musk (Elon's brother) two years ago. They've signed a deal with one of America's big distribution companies, Gordon Food Service, to locate herb-growing containers at some its 200 warehouses.

He says the deal represents everything about indoor farming's potential: locally grown, quick-to-market, fresh produce that can be harvested year-round and is free of pesticides and not affected by harsh weather.

"Indoor farming can answer many of the questions being asked by today's consumers about the provenance, sustainability and health of the food they eat," he says.

Jeffery Landau, director of business development at Agritecture Consulting estimates the global value of the vertical farming market will rise to about $6.4bn by 2023, from $403m in 2013, with almost half that attributed to growth in the US.

Despite the sector's high costs and limited food range, the potential is not lost on investors. Recently, AeroFarms, a producer of lettuce and other leafy greens, raised $100m, including from Ingka Group, Ikea's parent company. Bowery Farming raised $90m in a funding round backed by Google Ventures and Uber boss Dara Khosrowshahi.

Plenty, another major US player, raised funds from Softbank chief executive Masayoshi Son and former Google head Eric Schmidt. The company has ambitions to build hundreds of vertical farms in China. In the UK, food delivery and robotics company Ocado is investing in indoor farming.

But there have also been failures. "Vertical farms are a highly intensive capital expenditure," says Mr Landau. "Your lighting system will be one of your highest capital costs." And then there's ventilation, air conditioning, irrigation and harvesting. "Make a mistake and you will have one costly upgrade on the horizon," he adds.

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