Jul 27, 2021
Agriculture and food-related industries in the European Union (EU) provide over 44 million jobs. With a varied climate and the generational knowledge of European farmers, the EU maintains its place as one of the world’s leading producers and exporters of agricultural products.
Price trends for selected commodities in the EU between January 2018 – September 2020; Source: Data from the agri-food data portal, and chart from Alan Matthews
This all changed with the Coronavirus outbreak. Even though the EU’s agri-food sector showed resilience, farmers and food producers faced increased pressure to provide high-quality and safe food to the region.
At the onset, lockdowns made it difficult for farmers to find seasonal workers, particularly in the fruit and vegetable sectors. The closure of food services significantly reduced demand for products like potatoes, high-value meat cuts, and some dairy products such as cheeses. The loss of export markets similarly hit wine producers. The impact on prices of selected commodities showcases this challenge.
At this time, EU member states came together to directly support these farmers with loans or guarantees for operational costs.
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The Farmers of the Future study spoke to several farmers in the region and concluded that “agriculture is one of the most important sectors in the transformation of the European economy and society towards a long-term sustainable future. European farmers will face several challenges in the future as they continue to supply food and non-food products.”
According to this report, the EU's controlled environment agriculture (CEA) market held its ground in 2020, reaching over US $31 Million. Europe had a 51.4% share of the market in 2020 and “is likely to continue to account for a notable market share by the end of 2026.” Today, it is expected to witness a compound annual growth rate (CAGR) of 5.2%, and a year-over-year (YoY) growth of 18.4%.
The European Commission has even recognized CEA as a prospecting sector constitutive of Europe’s future farming landscape. Policy and the Circular Economy Action Plan have aided this interest in CEA throughout the European Union.
What other factors are driving this interest in CEA in the EU?
#1: Limited Arable Land
According to the World Bank, the EU’s percentage of arable land has been consistently dropping since 1960. Today, less than 25% of the region’s land area is arable. This problem is heightened in Central Europe, with countries like Croatia, Estonia, and Slovenia having less than 15% arable land.
Image sourced from Agricool
Given the challenge of limited space and land that is suitable for growing crops, companies and cities are turning to CEA.
Agricool, for instance, responded to the challenge of limited land in Paris by developing multiple hydroponic shipping containers. Agritecture was hired to help the company benchmark the performance of their container farms relative to current indoor farming solutions. Through these containers, the Agricool team is able to grow delicious strawberries in dense urban areas at scale.
#2: Food Safety
According to the World Health Organization’s Regional Office for Europe, “every minute, 44 people – more than 23 million per year – fall sick from eating contaminated food, and an estimated 4700 per year lose their lives” in the region.
The most common cause is norovirus infections, which cause an estimated 15 million cases, followed by campylobacteriosis, which generates close to 5 million cases.
The European Commission takes this concern very seriously and is committed to assuring a high level of food safety, animal safety, and plant health. They believe that “every European citizen has the right to know how the food they eat is produced, processed, packaged, labeled, and sold.”
Food safety is a huge contributor to the shift toward CEA-grown produce. In taking a technology-based approach to food production, crops grown have fewer external factors impacting their cleanliness and safety. For example, there is no need for pesticides; crops are unaffected by an increasingly unpredictable climate; and there are no physical or microbial hazards from water use or herbicides.
#3: Unfavorable Weather
According to the European Environment Agency’s report, “changes in temperature and precipitation as well as weather and climate extremes,” caused by climate change, “are already influencing crop yields and livestock productivity in Europe. It also affects the availability of water needed for irrigation, livestock watering practices, processing of agricultural products, and transport and storage conditions.” Climate change is projected to reduce crop productivity, especially in parts of southern Europe, and to increase the number of extreme events negatively affecting agriculture.
As a result of these challenges, the EU is turning to CEA. The Commission has included efficient irrigation, precision farming, and sustainable food production in greenhouses in their climate adaptation strategy. These measures are believed to not only help preserve local ecosystems and biodiversity, but also to increase the resilience and predictability of food production in the region.
Image sourced from Urban Crop Solutions
In response to the growing challenges of climate change, a former client, Belgium-based Urban Crop Solutions, launched their Module-X Vertical Farming System to help entrepreneurs achieve profitability faster regardless of where they grow. The system enables complete climate control so that crops are unaffected by weather conditions, and can be easily scaled by deploying additional modules.
Urban Crop Solutions is also one of a growing list of indoor farming solution providers that are part of Agritecture’s Partner Network. By signing up for Agritecture Designer, users receive benefits including unbiased, third-party advice and discounts on equipment orders.
#4: Agricultural Independence
Despite its small size and dense population, the Netherlands makes far more food than it can eat. Even though a third of this country is situated under sea level, in 2017, they exported an astonishing $111 billion worth of agricultural goods.
The reason for this is controlled environment agriculture.
The Dutch pioneered specialized greenhouses with temperature and humidity control. In total, the country contains 36 square miles of greenhouses, an area 56% larger than the island of Manhattan. And, as a result, they’re now greatly agriculturally independent.
Dutch greenhouses even use their water and energy more efficiently - they use 1.1 gallons of water per pound of tomatoes produced, in contrast to the 25.6-gallon global average, with some farmers producing over 100 million tomatoes per year from only 14 hectares of land.
Learn more about CEA in the Netherlands here.
