A Look at the Future of Indoor Farming — New Study

The College of Agriculture and Life Sciences (CALS) at Cornell University has long been an important research hub for indoor farming, also known as controlled environment agriculture (CEA). Under the leadership of Neil Mattson, CEA director and associate professor at the university’s School of Integrative Plant Science, Cornell CALS investigates some of the most pressing questions currently facing CEA and conducts valuable research with the goal of advancing the entire industry.

Recently, in its capacity as the Research Partner for the Indoor AgTech Innovation Summit, Cornell CALS collaborated with two Cornell economists, Charles Nicholson and Miguel Gómez, to produce a report examining the economic and environmental viability of different farming scenarios, including urban farming and CEA. Read on for a closer look at the questions the study examined and the answers it found.

What did the study focus on?

The Cornell CALS collaborative report was based on a comparison of three different ways to provide fresh leafy greens to two different cities: New York and Chicago. For each city, the scenarios examined were field production of the greens in California, followed by shipping to the city in question; greenhouse production in a hypothetical urban or peri-urban facility with a one-acre crop canopy; and vertical farm production in a hypothetical urban or peri-urban warehouse facility, also with a one-acre crop canopy.

Economically, how do the greenhouse and vertical growing methods compare with open field farming?

Perhaps not surprisingly, the study found that field production and cross-country shipping was the least expensive of the three options by a considerable margin. For both cities, this scenario had a landed cost of just $3 per kilogram of lettuce. By contrast, in New York, the greenhouse scenario cost $8 per kilogram and the vertical growing method slightly less. Costs were similar in Chicago at $7 per kilogram for greenhouse production and slightly less for vertical growing.

What are the implications of these results?

While CEA in urban areas boasts many advantages over other growing methods, this report confirms the well-known fact that up until now, it has struggled to offer a truly cost-competitive alternative to traditional field production and shipping.

One of the main reasons for the high cost of CEA is land cost: in dense urban areas, available land is scarce and therefore more expensive. This also explains why the vertical growing scenarios in both cities were slightly cheaper than greenhouse production: vertical facilities make more efficient use of land and can have a much smaller footprint. Another major contributor to the higher overall cost of CEA is the cost of labor: in the unautomated CEA scenarios the report examined, labor made up half of the total cost.

In addition to pointing out these economic challenges, the report also highlighted opportunities that CEA could take advantage of in order to become more cost-competitive. For example, as a follow-up to this study, the Cornell CALS team is looking at a further scenario that makes use of automated production, which could have the effect of reducing labor costs by as much as two-thirds to three-quarters.

Similarly, moving CEA facilities away from city centers or peri-urban areas to cheaper land within about 200 miles of the city can reduce production costs even further, while still eliminating most of the roughly 3,000 miles that fresh produce must travel in order to get from California to the East Coast. If these two measures are taken together, the researchers estimate that CEA greenhouse production costs may fall to $4 per kilogram, which is far closer to the current cost of conventionally grown produce.

Did the study reveal any surprises?

A criticism often levelled at CEA growing methods is that, although they may be much more efficient in their use of land and water resources than field growing, they are not truly sustainable due to the high energy demands of their lighting systems and other equipment.

However, the Cornell CALS study found that the greenhouse scenario in New York had an energy demand and global warming potential very close to that of the field production scenario. This was true even though the greenhouse scenario did not involve any self-contained renewable energy sources and instead relied on buying electricity and gas directly from the grid. The promising implication here is that greenhouse operations that incorporate sustainable energy sources — such as renewables, combined heat and power, or waste heat capture — could indeed offer a lower carbon footprint than field-grown leafy greens.

What’s next for CEA, according to the study?

In addition to examining and addressing the current issues around cost, land, and labor, the report highlights another important area that CEA will need to focus on in the future: crop diversification.

At present, most successful CEA facilities primarily produce leafy greens and herbs, which makes sense given that consumers place a higher value on these perishable items when they are local and freshly harvested. However, CEA will need to move beyond these staple crops in order to have a bigger impact on our overall food supply: tomatoes and strawberries, for example, are two high-potential crops that researchers and growers are currently investigating.