Vertical Farms in South Korea Betting on Cannabis
The major advantage of the new technology of vertical farms for industries such as cosmetics and medicines is the ability to meet rigorous quality standards
Curation and editing by Sechat Content, with information from Bloomberg (Heesu Lee)
Overburdened, especially by the need to ensure local supply of fresh vegetables during the pandemic, some vertical farms are now expanding into other high-margin areas. Some areas that can be mentioned are, for example, medicinal cannabis, health supplements, and cosmetics.
The South Korean startup Farm 8 Co. is among a proliferation of indoor urban producers that have seen sales increase during Covid-19. Initially, the goal is to increase sales by almost 50%, to 90 billion won (79 million dollars) this year. This is partly due to the increased production of medicinal plants for cosmetics, such as ginseng, centella asiatica, and artemisia campestris, as CEO Kang Dae Hyun stated. In August, the company joined the country's first regulation-free zone for medicinal cannabis, hemp cultivation, and processing.
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The Rise of the Medicinal Cannabis Market
“There is a huge demand for medicinal cannabis and the market is growing rapidly,” Kang said in an interview. “Currently, most of our production is dedicated to salad greens. But ultimately, we will increase the production of cosmetic and medical plants to maximize profit.”
Other vertical farms are also using the technology to meet the growing demand for strict quality control in medical and cosmetic applications. Such as the International Cosmetics Science Center in Denmark, Vertigo Farms in Poland, and MedMen Enterprises, based in California.
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Farm 8 Co. currently cultivates about 1.2 tons of greens per day on less than an acre (0.5 hectares) of land, spread across locations in three cities in South Korea, including a busy subway station in the South Korean capital.
The Benefits of Vertical Farms
This is the traditional market for vertical farms - guaranteed delivery of quality-controlled fresh products that need to reach the consumer quickly, regardless of the weather or season. These advantages have been emphasized as disruptions in supply and unreliable harvests pushed global food prices to a peak in February.
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“You need the right amount of everything, from water to light, and the climate has to be perfect, which is increasingly difficult to predict,” Kang said. “We started as a traditional agricultural company 16 years ago, but we learned to incorporate technology because we needed to protect ourselves from climate change.”
Vertical farming uses up to 90% less water and reduces emissions caused by field plowing, weeding, harvesting, and transportation, but it uses much more energy than traditional methods, making it unsuitable for many crops, such as grains.
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The Legalization of Cannabis in South Korea
South Korea became the first country in East Asia to legalize cannabis for medical use in 2018, and in August 2020, the government created a free trade zone for industrial hemp in the city of Andong, in the southeast, to develop and extract cannabidiol for medical use. Marijuana remains illegal for adult use in the country.
Cannabis, of course, has been cultivated illegally indoors on a small and large scale for decades, and the gradual legalization of the plant in some US states has led to a plethora of vertical farms. But the major advantage of the new technology for industries such as cosmetics and medicines is the ability to meet rigorous quality standards.