When you hear the phrase “controlled environment agriculture” (CEA), what do you envision? Maybe a large commercial greenhouse? An indoor vertical farm with extensive lighting and HVAC? Perhaps a fully integrated container system where every system is controlled by a proprietary program?
Do you think of the humble high tunnel?
Perhaps you should. Depending on the setting and crop, it might be the perfect tech level for a profitable CEA operation.
“‘CEA’ typically refers to a fully enclosed environment where you’re trying to control every element within a building, but when people are trying to look at lower-cost solutions for different crops, it can include solutions that will be manipulating the outdoor climate to create a better environment,” says Richard Vollebregt, CEO of Cravo Equipment Ltd., a Canadian-based company that designs and builds retractable-roof houses for global agriculture, specializing in fresh produce.
“Anytime you are using manual or automated tools and systems to control the climate — be it a room or greenhouse or a hoop house — to either extend the season or to grow more profitably year-round, that’s controlled environment agriculture,” says Aaron Fields — CEO of Campo Caribe, a Caribbean-based hydroponic lettuce facility — who has grown in CEA operations in Texas and Puerto Rico as well.
Both Vollebregt and Fields — together with Chris Higgins, general manager of Hort Americas, a Texas-based CEA supplies provider — spoke during the most recent “Indoor Ag-Conversations” webinar, held Aug. 26. The focus was on what tech it takes to build a profitable controlled environmental agricultural system.
Right-sizing Technology
Higgins observes that growers, particularly CEA growers, are constantly being bombarded by new technology. Particularly in the CEA space — whether using the typical “high-tech” definition or the “low-tech” definition the panelists advocate — he stresses the need to think about the needs of the crop, the specifics of the growing location, and the needs of the market being served when it comes to technology.
“I like the term ‘right-tech,’” he says. “At the end of the day, as farmers, we need to grow at a profit and we need to be able to sell a certain quality. Those are the two things that we are striving for. So, we are looking for technology that helps us achieve those two very basic goals.”
What that “right-tech” looks like will differ wildly depending on crop and location, however. While northern climates might need to manage for too little light and heat, hot and humid climates might struggle with too much heat and light, for instance.
Some limitations are too much to overcome profitably, however. Vollebregt gives the example of trying to grow tomatoes in environments with high nighttime temperatures. The only practical way of cooling down nighttime temps to achieve good quality in the tomato would be air conditioning, which isn’t practical.
ROI and FOMO
Vollebregt says every tech decision must go back to finances.
“The level of technology or investment you can make is directly connected to the revenue you get paid,” he says. “You need to figure out what is the profitable production system that’s going to make your [capital expenses] efficient, minimize your [operating expenses], and hit the highest price window you can to generate the most revenue per acre or per hectare.”
Going back to the example of growing tomatoes, he points out that everything from a high-tech glass house to a tunnel to a field can grow them. The question comes down to: What technology is worth it?
“Where does the revenue increase line cross the capex and the opex line?” he asks.
Fields voices skepticism in many cases, opining that “the tech industry and the sales guys will prey on FOMO, the fear of missing out,” particularly among inexperienced growers or startups.
“We have to be very wary of it as farmers, as growers, as greenhouses, because it is rarely worth the investment,” he says.
“If a technology, as flashy as it can be, isn’t significantly decreasing my cost or significantly increasing my production efficiency, I have to really question whether it’s sexy enough to use. I think everyone should ask themselves that when making any decision: What’s the ROI on this and does it really make my life better?”
