Agricultural Technology or Agtech as its more commonly known received nearly $5 billion in VC funding in 2021, up over 60% for 2020. With Crunchbase reporting $1 billion in Agtech investments through January 2022, this annual growth is on pace to continue.
The growth of the global population continues as well, projected at 9 billion by 2050, which means more people and less available land. That’s why one of the key drivers of Agtech growth is vertical farming. In 2020 venture capitalists put nearly $1 billion into the space-saving technology many are calling “the future of farming.” Vertical farms are to agriculture what buildings/skyscrapers are to real estate.
It’s not just the growing population and lack of space that makes vertical farming so desirable to investors.
Agriculture is also one of the top culprits of climate change. Food production takes up 50% of the planet’s habitable land, accounts for 70% of freshwater consumption, and produces 20-25% of greenhouse gas emissions.
WHY VERTICAL FARMING IS THE FUTURE OF AGRICULTURE
–Vertical farming uses 90-95% less water than traditional farming.
–Vertical farming uses less land.
–Vertical farming uses less fertilizer and pesticides.
–Vertical farming reduces transportation costs allowing cultivation near big cities.
–Crops grown indoors are always in season and do not depend on weather conditions.
–-Vertical farming reduces food waste.
The food waste part is particularly important, the United Nations says food loss and waste are 25%-30% of total food production and 8%-10% of global greenhouse gas emissions.
INVESTING IN VERTICAL FARMING
With all of these fantastic benefits, it's no wonder Precedence Research projects the Vertical Farming Market to grow 25.2% annually through 2027, and reach $31.6 billion by 2030.
Investors looking to get involved in the growth of this ESG technology have plenty of promising options.
Pontus Protein Ltd. (TSXV: HULK) may be one of the highest potential plays in space. Due to its name and perception as a pure plant-based protein play some investors may not see that HULK.V is actually a true Agtech Vertical Farming play. In a recent interview when asked about its breakthrough vertical aquaponic farm technology, CEO Connor Yuen said, “With our CEVAS technology we are working towards consulting other plant-based food companies in sustainable agtech…
Pontus NEEDS to shift its focus to acting as a platform to accomplish our goal of acting as a catalyst to reinvent agriculture.”
This is great news for Agtech/ Vertical farming investors, especially considering the company is doing quite a bit to solidify its board and just closed a $2 million dollar financing.
Pontus’ (TSXV: HULK) CEVAS technology, or Closed Environment Vertical Aquaponics System is a proprietary system that incorporates machine learning and Artificial Intelligence (AI). The company currently incorporates the technology at its 20,570 square-foot future production farm in the lower mainland of Vancouver, British Columbia.
This technology is unique, and could be a major disruptor in the Agtech space, make sure Pontus Protein (TSXV: HULK) is an investment you’re considering if vertical farming is important to your portfolio.
Another vertical farming play to watch, Affinor (CSE: AFI) developing vertical farming technologies and using those technologies to grow fruits and vegetables in a sustainable manner. The Company is currently growing strawberries for local markets in its 15,000 square foot greenhouse in Abbotsford, BC.
Affinor (CSE: AFI) just announced a distribution deal with Berrymobile Fruit Distribution Inc. Berrymobile is a Vancouver-based distribution company that supports and promotes fruit farmers in British Columbia. Berrymobile partners with retailers across major grocery banners in the Lower Mainland.
Another innovative farming technology like Pontus’ CEVAS, is CubicFarm® Systems Corp.’s (TSX: CUB) Crop Motion™ technology which consists of hundreds of growing trays moving under LED lights along a path from the back to the front of the modules, getting the right amount of light, water, and airflow to maximize their growth. The automated, hydroponic growing system uses 95% less water, no pesticides, or herbicides, providing predictable and consistent growing 365 days a year. Although, this may not save on space in the same way vertical technologies like Pontus does.
CubicFarm (TSX: CUB) just announced the sale of 27 systems in Winnipeg, Manitoba, at a sale price of CAD$5.13 million. Showing just how desirable these Agtechologies are.
PLANT-BASED PROTEIN WILL BE A MAJOR FUTURE FOOD
While agriculture is one of the largest contributors to climate change, animal-based foods are generally more resource-intensive and environmentally impactful to produce than plant-based foods.
Beef production for instance requires 20 times more land and emits 20 times more greenhouse gas emissions per unit of edible protein than common plant-based protein sources such as beans, peas, and lentils.
Pontus Protein (TSXV: HULK) is a plant-based protein producer, using its vertical aquaponics systems to grow water lentils. A few other plays in the plant-based protein space to watch are FEEL FOODS LTD. (CSE: FEEL) owner of Black Sheep Vegan Cheeze products and Burcon NutraScience Corporation (TSX:BU) who recently completed a joint dubbed Merit Functional Foods, received a co-investment from industry-led, not-for-profit organization Protein Industries Canada to develop quality meat alternatives. Merit Functional Foods is partnering with Winecrush Technology, Wamame Foods and Wismettac Asian Foods to develop and distribute a line of meat alternatives to pork and Wagyu beef.
AGTECH INVESTMENTS WILL CONTINUE TO GROW
It’s quite obvious, given the environmental and economic impact of the issues facing agriculture that winners in this space will make their investors a fortune. That’s why you should put Pontus Protein Ltd. (TSXV: HULK) on top of your radar today.
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