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Up Up and Away!. The Economics of Vertical Farming Chirantan Banerjee, Lucie Adenäuer and Stephan Rickert. Content. Global situation Design of the Vertical Farm Facts and Figures SWOT Analysis Market Analysis Outlook. [email protected]. - PowerPoint PPT PresentationTRANSCRIPT
Up Up and Away!
The Economics of Vertical Farming
Chirantan Banerjee, Lucie Adenäuer and Stephan Rickert
Content
Global situation
Design of the Vertical Farm
Facts and Figures
SWOT Analysis
Market Analysis
Outlook
2
Global situation: where do we stand?
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We need local food production technologies 38% of all land is used for agriculture 11% arable
1 billion still undernourished thereof 42% in India and China In rich countries, people spend 10% of their income on food, this is
50% in case of poor countries
FOOD IS NOT BEING PRODUCED WHERE REQUIRED AND SUPPLY CHAIN IS NOT WORKING
We need technology to adapt to consumer choice
Striking difference between rich and poor consumer needs
Increasing demand for especially protein rich diets
THIS IS EXPECTED OF ALL COUNTRIES ON THE DEVELOPMENT BANDWAGON
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1940 1960 1980 2000 2020 2040 20600
100000020000003000000400000050000006000000700000080000009000000
10000000
Total population (t-housands)Rural population (t-housands)Urban population (thousands)
Population Trends
Source: Population Division of the Department of Economic and Social Aairs of the United Nations Secretariat. World Urbanization Prospects: The 2007 Revision.
Possible Solutions
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We need to produce 100% more food!
2% increase of agricultural land expected until 2040 20% more food
Another 10% is expected from increased cropping intensity Problem of land use for fuel
How do we reach the missing 70% ?
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Vertical farming is a system of commercial farming
Plants, animals, fungi and other life forms are cultivated for food, fuel
Plants are artificially stacked vertically above each other
Through Controlled Environment Agriculture
Design of Vertical Farms
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Design of Vertical Farms
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Design of Vertical Farms
7
Design of Vertical Farms
7
Design of Vertical Farms
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Design of Vertical Farms
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Design of Vertical Farms
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PersonnelPower DemandPlant SeedsWater (re-cycled)NutrientsFish Food
Facts and Figures
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Cost Scenarios
Building Parameters
with Salvage Value
without Salvage Value
Production Parameters
Mechanised
Manual
Production technology
Aeroponics
Elevated CO2
Normal
Fixed Cost Margin
High 30%
Medium 20%
Low 10%
Variable Cost Margin
High 30%
Medium 20%
Low 10%
Facts and Figures
Cost of producing edible biomass is around
3.17 €/kg
Worst case: 6.32 €/kg
Probability distribution of costs per kg biomass
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INTERNAL ANALYSIS
STRENGTHS WEAKNESSES
Industrialisation of Agriculture Space
Independence from External Threats Light
Energy generation Water
Environment Energy Balance
EXTERNAL ANALYSIS
OPPORTUNITIES THREATS
Consumer preference Sceptisism
Climate change & Environmental concerns Existing patents
Race for food soveriegnty Limited market
Renewable Energy Price and subsidies
SWOT Analysis
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DESERTSTAIGAMEGACITIES
DESERTSTAIGAMEGACITIESN = 2900
Criteria:
Population above 5 million
Per Capita income above $ 20,000 p.a.
Market Potential
Short Term Market Potential
Long Term Market Potential
N = 47
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Economic research is required to ascertain:
The energy balance
The cost of production
Linear programming of optimal cultivation strategy for cost minimisation
The cost benefit analysis
Consumer studies
A comprehensive market analysis with identification of potential candidates
Outlook
More Ideas?
http://www.ilr.uni-bonn.de/pu/publication/Publikationen/vertical_farming.pdf
CHIRANTAN BANERJEE, LUCIE ADENÄUER AND STEPHAN RICKERT
Institute for Food and Resource Economics, University of Bonn, [email protected]
THANK YOU!