A year on from our First Look at AppHarvest, Rory reevaluates the company to see if it delivered on its lofty promises.
This article can be found in the MyWallSt App, alongside an audio companion. Sign up today for a free account and get access to dozens of expertly written articles and analyst opinion pieces every month.
It’s been over a year now since I first wrote about AppHarvest (NASDAQ: APPH), a recently-SPAC’d AgTech business that was looking to conquer the fruit and veg isles.
From that First Look:
The company develops and operates large indoor farms, known as controlled environment agriculture (CEA) facilities. AppHarvest claims that these facilities can produce 30-times as much produce on the same acreage as open-field farms while using 90% less water, with no agricultural runoff, and no soil erosion.
Moreover, the company’s strategic location in Appalachian Kentucky allows them to deliver produce to 70% of the US population within 24 hours. Approximately 69% of vine crops sold in the U.S. are currently grown and imported from places like Mexico, with shipping taking up to 2 weeks. Not only does this cut down on the use of diesel in transportation (by up to 80%, according to the company), but it greatly reduces the spoilage rate. Of course, the company uses no chemicals or pesticides in production and employs high-tech sensors to ensure produce is of the highest quality when harvested.
Of course, this is not a novel concept. We’ve had greenhouses since the times of Ancient Rome, but AppHarvest’s bold claims about the power of its technology and processes piqued my interest.
And this technology has been tried and tested. Vertical farming has been widely adopted by The Netherlands, turning that small country into one of the world’s biggest food exporters.
From The National Geographic:
The Netherlands is a small, densely populated country, with more than 1,300 inhabitants per square mile. It’s bereft of almost every resource long thought to be necessary for large-scale agriculture. Yet it’s the globe’s number two exporter of food as measured by value, second only to the United States, which has 270 times its landmass.
However, it was still very early days for this business…