Container farming not profitable
Container farming is the cultivation of products in a container, which is adapted in such a way that the weather conditions are overcome and fully is equipped with the most efficient hydroponics cultivation system possible. Container farming is hot. The superlatives will fly you over if you look for them. But is that right? Here is a critical view of this new way of vegetable growing.
The question we have to ask is whether the rise of container farming is a realistic technological development or only suitable for an exclusive crop of lettuce. It is time to puncture unrealistic expectations and to talk honestly about the possible advantages and disadvantages of this trend. I hope that through this article, which has arisen after research of the various sites, the exchange of experiences with people in various countries and stories that I have heard from all over the world, wich I will give you an as objective as possible picture of the real place that container farming could take in the future of food shortage.
When you look at the market for the supply of container systems, there are a number of companies that stand out. The best known are: Freight Farms, Smart Greens, CropBox, Modular Farms, Alesca Life and Agritom. The last company is more focused on fodder systems (grass cultivation). More unknown: Growtainer®, Madar Farms, Harvestsquared, BoxXLand, Urban Crop Solutions and Sprout Stack. The American containers are generally the best known. I think they owe this to their aggressive market approach with many promises.
It is striking that containers for container farming are not cheap. Unfortunately, most companies are not transparent about their prices and other information. But if you have enough money you can even have a container with your own name made as the Belgians have done with FARMPRO in cooperation with the company Urban Crop Solutions.
In the Netherlands we also have container farming. For example, there is the Dutch initiative of Patrick Stoffer (Freight Farms container), which now tries out one of these containers under the name Growlocal. He has shared his experiences with us. His vegetables mainly go to the residential and care center Humanitas in Deventer. Albert Heijn (grocer) and De Bakker Barendrecht (Urban Crop Solutions container) have also place one for the headquarters of Ahold Delhaize in Zaandam. Only that will be a publicity stunt rather than a contribution to our world food issue, I think.
There is a lot of talk about the comparison with the yield of a container and traditional agriculture. For example, every 40ft sea container would yield the annual equivalent of three to five hectares of agricultural land. And in a container you could grow plants at least six times faster than on a conventional farm. Let’s look at the real numbers (numbers are averages).
- fact 1. A 40ft container has a capacity of 66 m3. The length is 11.95, the width 2.33 and the height 2.37 meters.
- fact 2. Lettuce on open ground yields (8 to) 12 crops of m2 and can be harvested twice a year.
- Lettuce under glass yields an average of 20 corps of lettuce per m2, with an average of 5 harvests / year.
- Lettuce under glass based on hydroponics yields 70 corps / m2 and 8 to 9 harvests per year.
- Lettuce in the modern automated environment produces 100 corps per m2, times 9 harvests.
- fact 3. The cost of a corp of lettuce is about 24 cents.(in Holland) The purchase price around 36 cents and the sales price between € 0.80 and € 1.00
- fact 4. The weight of lettuce lies on average between 200 and 350 gr. (depending on the species).
- fact 5. The yield per hectare of open ground is 10,000 x 12 heads x 2 = 240,000 heads per year is 48 tons;
- The yield per hectare under glass is 10,000 x 20 x 5 = 1,000,000 heads = 200 tons;
- The yield per hectare automated is 10,000 x 100 x 9 = 9,000,000 heads = 1800 tons. 5/5000
Now we are going to look at the container. Nearly all 40 ft containers reach a yield of between 27,000 and 40,000 heads of lettuce per year (see our website). This corresponds to a maximum of 1/6 hectares of traditional agriculture (so no three or five hectares as stated!). The yield is of course dependent on various factors, but also how you define a head of lettuce. To begin with, every head of lettuce needs a certain space. The more space there is for storage, movement and processing, the less space for the lettuce.
I always made this comparison when organizing a fair: every visitor needs at least 1.5 m2. So you can calculate very quickly how many visitors there can be at an exhibition: width times length of the aisles and visitor spaces (+ of course the time of visit included). Every trade fair organizer will charge more for the promotional activities than reality, which will look suspiciously like the calculation of the number of heads of lettuce. Because here too you are bound by a number of laws. An adult lettuce plant needs a space of at least 30x30x30cm (= 27,000cm3). So when you have a container 100% full you can have 2444 plants in it. Then you have no aisle, no distance from lighting to plant, no picking or processing place, no room for electricity, pump, etc. And every cm3 counts. According to the builders of the container farms, the number of plants varies between 2700 and 3500 plants per container. Apparently they have devised a trick to reduce the amount of space per head of lettuce. You can also see this in practice. A vertical system has 13 plants per row. That would mean that you have to go up to 4 meters from my dimensions. But the height of a container is only 2.37 meters. So the plants only have a distance of 18 cm instead of 30. In traditional agriculture this is 25 to 30 cm. The size of a small head of lettuce is between 15 and 20 cm. In principle they are always bigger. In other words, the growth margin, the number of heads of lettuce per m2, is limited in comparison with water cultivation and agriculture. In addition, the yield is further increased by accelerating and optimizing the growth process. And here: the pops lettuce is a fact!
Now let’s assume the yield that is feasible according to the container builders, is 27 to 40,000 heads per year. Then you come to 74 to 110 heads per day. A store pays about 36 cents, that’s between 26 and 40 euros per day, or 780 to 1200 euros per month. That is of course not the profit, but the turnover. The purchase of the container and the system, the soil to set it up, the electricity, the water, the seed, the growth substances, the maintenance and the labor costs are not included. If you could sell the heads directly to the consumer, which is of course much more work, for a price of one euro each, your gross turnover at 80 heads per day is 2400 euro per month.
- A container farm is not cheap. Although they do not all mention their price, the price is approximately between 75 and 120,000 euros. That is 25 to 40 million euros per hectare. For one tenth of that money you have a modern greenhouse, with a price of about 2.5 to 4 million euros per hectare;
- The electricity costs of a container are considerable. Again, the companies prefer not to mention what their containers consume on electricity. But assuming the amount of LED lamps you can assume that the energy consumption is around 35000 kWh per year (equal to the consumption of more than 10 households). Depending on the country in which you live, these costs will reduce your profit much or very much. In the Netherlands it amounts to more than € 7,000 per year or € 600 per month.
- Working conditions are not ideal. Since every cm3 is important, you see that the workspace is kept to a minimum. Jokingly you can also say that the work is not reserved for people with a strong stature. The container must always be closed in most weather conditions, so you are in an enclosed space with artificial light. You must therefore also not be claustrophobic.
- Some container companies have also devised a way of not limiting profit by only selling the container. They prefer to make you dependent on them for a long time. They can do this by developing food systems that only they have. You are then obliged to continue to take it. Sometimes you also see that growth media systems have been specially made for their container. Prices are not known. But even without this strangulation you will have to feed your plants.
- There is a restriction in the number of vegetables. The current breeding containers are focused on high-quality, fast-growing crops that require only a small area and a high turnover rate, such as lettuce, basil and other salad products. Slower growing vegetables are not profitable at all.
When you look at all aspects, you see that the purchase of the container and the construction of water and electricity cables already require a substantial investment and that, in addition, ongoing costs such as land rent, taxes, energy, seeds, growth mediums, and nutrients put the profits under considerable pressure . In fact, we have to conclude that the exploitation of a container as a production location is not profitable, on the contrary: it is quite loss-making. You must have at least four containers and work 80 hours per week to make it profitable. Or sell each head of lettuce for € 4,
Remember that container farming can not actually be about how much production you can put into a room. It is about bringing food closer to the people and maximizing production as a function to recoup the resources and labor that you invest. But not at all costs. So while container parks have the potential to make a fundamental contribution to bring food closer to the market, the people who exploit these container farms must be able to survive in order to make an impact.
Containerfarming certainly also has advantages over other types of cultivation.
- In terms of sustainability, the reuse of containers is, of course, perfect. They are easy to transport and the containers themselves are cheap and there are many. The 40ft containers in particular are popular (but an old container is far from being a container farm).
- Another positive aspect of a container is that it can be placed in impossible places. You only need an area of 12 by 2.5 meters. Although they have forgotten to mention that you have to take into account that most containers require a perfectly flat surface (level) in order to function properly. So putting it in your backyard can be difficult.
- Another advantage of a container is that you can quickly start your own business and no special building is needed (probably a building permit). This means that a modern city farmer or a company in the city can easily put a container behind their restaurant or even in a parking space.
- The most obvious advantage of any form of gardening in a container, whether it is flowers, grass or vegetables, is the possibility to grow them in places where a normal garden can not be realized. Such as in case of lack of ground or lack of clean soil.
- The distance from production to the customer is minimal.
- The transport of vegetables to the local market also prints the food print.
Container farming is a piece of technology that is not unique in itself. There are sufficient locations and initiatives in the world in closed spaces that use the same techniques. You must therefore ask yourself whether an existing location is not more suitable in a city to bring food production closer to the customer. (rooffarming) Container farming does have the technology and the potential to grow relatively many vegetables on a small surface, only: at the expense of what? It is certainly not a feasible sustainable initiative given the costs. For the time being I can not find a place in the world that would justify container fueling when it comes to solving our “world food problem” or for a sustainable future. There are many cheaper systems in a city to solve this “problem”. You can always approach us about this. So becareful by using these containers.
© Ed van der Post