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Greening the desert

The Coronavirus pandemic has highlighted structural issues with global supply chains and food security. Even before the pandemic the UAE (which with its fellow members of the Gulf Co-operation Council import approximately 90 per cent of their food) was prioritising agritech in an effort to overcome regional and global agricultural challenges such as non-arable land, climate change, water scarcity and food security.

The Abu Dhabi Investment Office (“ADIO”) last year launched an incentive program through which it has earmarked AED 1 billion for investment into agritech. As part of the package, Abu Dhabi offers rebates of up to 75 percent on R&D expenditure upon commercialisation of the new solutions developed in the emirate.

Last week saw ADIO announce funding of $100 million into four agritech companies - Madar Farms; Aerofarms; Responsive Drip Irrigation and RNZ. Madar Farms will build the world’s first indoor tomato farm utilising LED lighting; Aerofarms will build an R&D centre in Abu Dhabi focussing on next-generation phenotyping and organoleptic research; Responsive Drip Irrigation (or “RDI”) is developing an innovative irrigation system to transform water usage in UAE agriculture and conducting research trials to increase crop yields in non-arable land; and RNZ will set up a state-of-the-art R&D centre to research, formulate and commercialise ‘agri-input’ solutions that will help to grow more with less.

Also, last week Abu Dhabi agritech start-up Pure Harvest Smart Farms received a multi-stage investment commitment of $100 million with Wafra International Investment Company to fund hiring and massive expansion of its sustainable greenhouses in the UAE and Saudi Arabi. These investments all add to a growing agritech sector in the region.

The vertical farming industry is still early, but it is hoped that the new wave of support in the UAE could give the industry a boost. Although, there are still question marks regarding the economics of vertical farming, any production method which is land agnostic and conserves water makes particular sense in the UAE. Placing vertical farms in a desert environment could be a true test of the sector’s value proposition.

Link to related article: https://www.investinabudhabi.ae/News/USD-100-million-ADIO-investment-brings-four-global-AgTech-pioneers

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