Virginia is working to be at the forefront of the fast-growing controlled environment agriculture industry. And, based on information shared at this week’s CEA Summit East, it’s in good shape to achieve this goal.
Controlled environment agriculture, or CEA, is a technology-based approach to farming. Factors like temperature, humidity, airflow, light and water are controlled to try to produce optimal conditions for growth.
Familiar examples of controlled environment agriculture include greenhouses and hydroponics. It’s become popular because of its ability to be more productive, fresh, local, and environmentally friendly than traditional farming.
Virginia has seen increased interest and investment in CEA recently. Two CEA companies, New Jersey-based AeroFarms and California-based Plenty Unlimited, Inc. both located in Virginia this year.
AeroFarms in Pittsylvania County is the largest aeroponics farm in the world, and Plenty in Chesterfield County is the largest investment in indoor vertical farming in the world at $300 million.
Virginia competed with five other states for Plenty, according to the Sept. 14 release from Gov. Glenn Youngkin’s office. This “further advances the Commonwealth’s reputation as a leader in the fast-growing industry of controlled environment agriculture,” the release said.
AeroFarms and Plenty join a host of other CEA companies in Virginia, such as Babylon Micro-Farms in Richmond, Red Sun Farms in Pulaski County, Greenswell Growers in Goochland County, and Soli Organic (which just secured $120 million to expand its CEA operations) in Harrisonburg.
More examples are listed on the Virginia Economic Development Partnership’s website, which calls Virginia “a top state in the CEA industry” due to access to international markets and supply chains, access to natural resources, and access to talent from the state’s many community colleges and universities.
Virginia’s deep history of agriculture also makes it well-positioned to succeed in CEA, said Kaylee South, assistant professor at Virginia Tech and member of the Controlled Environment Agriculture Innovation Center in Danville.
South helped organize the inaugural CEA Summit East, an event that brought together industry experts to share information and network Oct. 25 and Oct. 26.
The event had around 230 attendees from 28 states, and it featured keynote speeches from AeroFarms CTO Roger Buelow and Virginia Secretary of Agriculture and Forestry Matt Lohr.
There were also over 40 other expert speakers on a variety of panels and sessions that discussed topics like selecting technologies for CEA operations, finding funding, and workforce development.
The event was held at Danville’s Institute for Advanced Learning and Research. It was co-hosted by the Controlled Environment Agriculture Innovation Center and Indoor Ag-Con, an annual trade show and conference for indoor agriculture held in Las Vegas.
Suzanne Pruitt, event director for Indoor Ag-Con, said the Las Vegas show has attendance from 48 states and 28 countries.
And within this global industry, Virginia stands out as a great location for CEA, Pruitt said. Here are some reasons why.
Government support for CEA
Stephen Versen, with the Virginia Department of Agriculture and Consumer Services, said the state has made “recruiting and supporting CEA a core focus of our work” during a panel at the event.
Versen is project manager for the Agriculture and Forestry Development, which he described as the economic arm of VDACS. Not many other states have an entity like this that administers a specific grant program focused on agribusiness, he said.
The Governor’s Agriculture and Forestry Industries Development Fund (AFID) was created 10 years ago to provide sorely needed resources in agriculture, Virginia’s largest private sector industry, he said.
“Agriculture is Virginia’s largest private industry by far, with nothing else coming a close second,” the VDACS website says. “Every job in agriculture and forestry supports 1.7 jobs elsewhere in Virginia’s economy.”
Agriculture in Virginia has an economic impact of $70 billion annually and employs over 334,000 people, according to VDACS.
“[AFID] is an example of how the state has developed resources to allow us to partner with local governments and our industry partners to get results on the ground in Virginia,” Versen said.
Lohr also talked about AFID during his keynote speech, saying that the state appropriates $1.5 million per year into this program, and VDACS is working to increase that amount.
“In the last 10 years, we’ve had over $1 billion of economic capital investment in these projects,” Lohr said. “Our grants range from $25,000 to $1 million depending on the size of the operation, the number of jobs and CAPEX investment.”
In addition to financially driven resources like AFID, the state has many resources to support other aspects of CEA, like workforce development and international marketing, Versen said.
He was joined on the panel by Carl Gupton, president of Greenswell Growers, and David Lopez Restrepo, head grower at Babylon MicroFarms.
“VDACS has been a champion of Babylon for quite a while now because we need venture partners and help importing and exporting,” Lopez Restrepo said.
Babylon MicroFarms produces small indoor farms, about the size of a bookcase, for places like universities, corporate cafeterias, retirement homes and libraries.
“We’re installing products in different places, even internationally, and finding out the tariff code can be a bit difficult,” Lopez Restrepo said. “It’s been great to have help from the state with that.”
Gupton said the state department helped Greenswell Growers, a large-scale indoor greens producer, connect with the grocery sector and service sector to sell their product.
These two sectors are “archaic,” Gupton said, in that they move very slowly. So, it can be hard for them to get involved with CEA, which moves very quickly.
But “VDACS helped make those introductions for us, they teed it up,” Gupton said. “We closed two major retailers, and VDACS was a big part of that. They were with us from the start, from the idea to the execution, and now to the growth.”
Strategic location
Virginia is also in a great location to distribute CEA products to other areas of the county, Versen said.
“We have this incredible position on the East Coast, with reach to large markets in the North East and growing markets in the South East,” he said. “We’re not exporting yet, but when we do, we’re ready.”
The Danville-Pittsylvania County area specifically is within a day’s drive to 60% of the U.S. population and two-thirds of the U.S. industrial base.
This strategic position is advantageous in the CEA industry’s goal to address food insecurity. Crops grown indoors can be produced out-of-season and out-of-region, making them much easier to get in food deserts, urban areas where it’s difficult to find fresh or affordable food.
“Virginia, especially [the Danville] area has good access to main highways,” South said. “It’s close to a lot of city centers, where distributors need to transport the food.”
People are becoming more interested in finding out where their food comes from, Pruitt said.
“That local food factor is so important,” Pruitt said. “With CEA in Virginia, you don’t have to wait for lettuce to come all the way from California.”
In fact, AeroFarms is sending greens from Virginia to California, said Buelow during his keynote address.
“The location in Virginia is amazing, whether you’re AeroFarms or Plenty, or any of these guys coming in, it’s strategically located to help with distributions,” Pruitt said.
CEA Workforce
The average age of a farmer in Virginia is 59, said Virginia Secretary of Agriculture and Forestry Lohr during his keynote address. But the technological nature of CEA work casts a wider net for employees than traditional farming and appeals to a younger workforce, he said.
“We’re bringing people that typically are not farmers, typically are not involved in these industries and we’re bringing them and their skills into agriculture,” Lohr said.
Virginia also has access to a diverse labor market, Versan said.
Some of the wealthiest counties in the country are in Northern Virginia, where average wages are very high and the workforce tends to be skilled. Other areas of the state have lower average wages and more unskilled labor, he said.
“That mix of talent, of wage levels, really serves this industry well,” Versen said. “If you’ve got something that requires a high-tech touch, you’ve got the workforce for that. If you need a workforce that’s focused on robotics or production, we’ve got that here too.”
The state also has a history of working with H-2A employees due to the tobacco industry, and Virginians are comfortable with that idea, he said.
The H-2A temporary agricultural program allows employers in the industry to bring nonimmigrant foreign workers to the U.S. for seasonal or temporary labor, if they’re expecting a shortage of domestic workers.
And though much of CEA work is automated, especially in large operations like AeroFarms, a human workforce remains crucial to the industry.
During a panel on cultivating a workforce, John McMahon, founder and farm manager of Schuyler Greens in Schuyler, Virginia, said it’s “a big misconception” that machines do all the work in CEA.
“All the technology, sensors, cameras, monitors, alarms, that only gets you so far,” McMahon said. “You still need a human to guide the equipment. Of course, there’s a lot of AI and machine learning…but ultimately there’s still a human touch. A lot of times people don’t realize just how hands-on it can be.”
Anthony Smith, plant manager for AeroFarms in Pittsylvania, also on the panel, agreed.
In fact, automation actually promotes more teamwork, Smith said, because employees often have to collaborate across different departments to keep automation functioning.
“There’s no need to fear automation taking jobs, because a machine is just a machine,” he said. “People are the brains of a machine. It can’t do it by itself and it needs your input constantly.”
Industry strategy
Part of Virginia is also working on an economic development strategy for CEA, which Bryan David, program director of GO Virginia Region 3, discussed during a presentation at the event.
Region 3 includes the cities of Danville and Martinsville and the counties of Amelia, Brunswick, Buckingham, Charlotte, Cumberland, Halifax, Henry, Lunenburg, Mecklenburg, Nottoway, Patrick, Pittsylvania, and Prince Edward.
“If you don’t know where you’re going, any road is going to take you there,” David said in an interview before the event. “CEA is an emerging cluster and by golly, we ought to get in front of ite.”
The amount of venture capital investment that’s going into CEA startups is “phenomenal,” David said. And the state wanted to be prepared with a strategy as this industry continues to grow.
David said that this may be the first time that professional economic developers, workforce development professionals, entrepreneurs, ecosystem managers, higher education and workforce are coming together to develop a joint strategy.
The strategy is not complete yet.
But it will involve “an analysis of this emerging and dynamic agribusiness sector,” including industry and economic growth potential, identifying needed facilities and infrastructure, workforce development issues and opportunities, and applied research assets, according to the project summary.
Region 3 staff has also created a Situational Awareness Workgroup representing all of the area’s regional and local economic development and workforce development organizations.
“We’re innovating something and creating it out of whole cloth, something that hasn’t been done, with this type of strategy,” David said. “We’re charting new territory to make sure we’re prepared.”
Growth of CEA
Pruitt said she’s seen CEA grow rapidly in recent years. In 2018, Indoor Ag-Con had about 19 exhibitors at the Las Vegas trade show. Now, there are over 165 exhibitors, she said.
“It’s still a very young industry, but everyone’s kind of got their eye on it,” Pruitt said. “Whether it’s climate change or the environment, there’s so many reasons for CEA to grow.”
According to a 2022 study by Grand View Research, Inc., the global indoor farming market size was valued at $39.5 billion in 2021 and is expected to reach $44.3 billion in 2022.
By 2030, the expected value of global indoor farming is $122.3 billion. This is a 13.5% growth rate from 2022 to 2030.
The Virginia Department of Agriculture is working to obtain a count of the number of indoor vertical farm operations there are in the state, said spokesperson Michael Wallace, but there’s no official list right now.
The Grand View study attributes this growth to rising population, which is causing increased worldwide demand for food. But other factors, like a decrease in cost in LED lighting and other technologies needed for indoor farming likely also contributed to the industry’s growth.
Virginia is on the right track to capitalize on this growth, according to Gupton with Greenswell Growers.
“Virginia is flexible,” he said in an interview. “It’s the South reinventing itself. Agriculture has always been a part of Virginia, and now we have the modern version of it.”