It’s a sobering challenge: Reduce Hawaii’s precarious dependence on food imports by ramping up local crop production to fill the plates of more than 1.4 million residents, as well as millions of tourists who visit the islands each year, amid projections of intensifying drought, water scarcity and competition for farmable land.

One route to getting there calls for crops to be grown on asphalt and in warehouses, either completely indoors or in advanced greenhouses.

More like science labs than farms, some of these futuristic food production setups don’t require soil for plants to grow. Often, artificial lights replace natural sun. And since moisture and nutrients can be delivered directly to the root, far less water is required to grow crops this way than in conventional farming. 

Other variables, such as humidity and temperature, can be precisely controlled to create an optimal climate to produce more crops with less space, while minimizing environmental damage. 

In Hawaii, this new era of agriculture is already underway — and starting to grow.

In a 40-foot shipping container off Farrington Highway in Waipahu, Bee’s Greens Co. grows butterhead and romaine lettuce under LED bulbs. Plants are stacked on top of each other in this vertical hydroponic system, achieving the same yields as a 1.5-acre conventional farm.

On Lanai, a 2-acre, high-tech greenhouse farm by tech entrepreneur Larry Ellison’s Sensei Ag produced 35,000 pounds of produce in less than three months last year. In 2021, the company expects to harvest 500,000 pounds of food for statewide consumption, including Swiss chard, basil, tomatoes, cucumbers and eggplant, without a pinch of soil.

And by mid-2022, the Florida-based indoor farming company Kalera plans to open a 50,000-square-foot facility, almost the size of a football field, in Campbell Industrial Park in Kapolei. The leafy greens grower’s partially automated vertical farm would be Hawaii’s largest, producing several million heads of lettuce per year, the company says.  

In December, the Florida-based urban food producer Kalera announced its plans to build Hawaii’s largest vertical farm in West Oahu. Courtesy: Kalera/2021

The University of Hawaii Manoa’s Department of Tropical Plant and Soil Sciences has identified agriculture systems that use technology to modify the natural environment to boost crop yields as a priority area for future curriculum expansion, according to Theodore Radovich, a professor of sustainable farming systems.

By eliminating seasonality, pest problems and bouts of bad weather, ag-tech advocates say this burgeoning sector is key to helping Hawaii improve its food sovereignty at a time when climate change is expected to give rise to exceedingly volatile weather that threatens to disrupt crop production and food supply chains.

California produces a critical chunk of the nation’s fruits, vegetables and nuts, including 99% of walnuts, 95% of celery, 89% of cauliflower, 71% spinach and 69% of carrots. But the state is in the grips of a brutal and persistent drought, causing agricultural water shortages that could have potentially catastrophic effects on the nation’s food supply

In the Midwest, where most of the nation’s corn grows, wetter springs and hotter summers could lead to a 25% drop in corn production by 2050.

And the list goes on.

“As it gets hotter, most crops are going to suffer,” said Jesse Cooke, vice president of investments and analytics at the Ulupono Initiative, which supports projects focused on locally produced food, renewable energy, clean transportation, waste and water management.

“So you need more of these high-technology types of farming setups to be able to provide more food to the masses, and it will just become more important as we move along because climate change is going to have big effects,” Cooke added.

Not A Panacea

Vertical farms and advanced greenhouses are limited, however, in what they can grow.

Ideal for small, dense crops, such as lettuce, tomatoes, cucumbers, peppers and eggplant, these ag-tech systems aren’t well suited for large plants or anything that grows on a bush or a tree.

Most indoor farms in America stick to lettuce, herbs and microgreens. 

Sensei Farms Lanai, a 2-acre indoor farming pilot project by Larry Ellison’s Sensei Ag, produced 35,000 pounds of produce in less than three months last year. Courtesy: Sensei Ag

Another hurdle is a need for massive capital investment. The systems usually need to operate an artificial climate to create superior growing conditions, and that comes with big energy costs.

In Hawaii, where sunshine is plentiful, paying the highest energy costs in the nation to grow crops with LED lights may prove to be a weak point in the indoor farming business model, Cooke said.

State energy regulators are considering giving greenhouse and indoor farming operators a break following the passage of a bill in the Legislature in 2019 that authorized the Public Utilities Commission to establish preferential electricity rates for what’s known as protected agriculture.

How much relief ag-tech growers might qualify for, however, is still unknown.

Brian Miyamoto, executive director of the Hawaii Farm Bureau, said new technology could help make agriculture a significant contributor to the state economy once again. 

Yet while he wants to see Hawaii farmers embrace cutting-edge food production systems, he’s concerned that they might cannibalize small, traditional farms.

“We need everybody — small farmers, medium farmers and large farmers — to help grow the industry and produce more of the food we eat here to get us closer to food security,” Miyamoto said. “But remember that most Hawaii farmers are small farmers. We don’t want to see this technology come in and (create) a net loss by putting (them) out of business.”

The Key To Competitive Pricing? Growing At Scale

Hawaii imports more than 80% of its food, including more than 90% of the lettuce consumed in the islands. 

The opportunity to take a bite out of the lettuce import market is what led Kalera, headquartered in Orlando, Florida, to start its business on Oahu, said Kalera CEO Daniel Malechuk.

Undeterred by Hawaii’s high energy and real estate prices, Malechuk said the company aims to offset some of those costs by selling its product at a far higher price point in the islands than it does on the mainland, as dictated by the local market.

Kerry Kakazu, owner of MetroGrow Hawaii, said he uses mists, LED lighting and controlled temperatures to grow his crops indoors. MetroGrow Hawaii is an urban, vertical farm, meaning crops are planted densely and stacked on trays, taking up a small area of space, rather than being spread across acres of land outdoors. Noelle Fujii/Civil Beat/2016

That doesn’t mean Kalera lettuce will be a luxury brand. The company plans to match, or come close to the sale price of lettuce imports.

When it’s up and running, Kalera’s indoor farm in West Oahu will use about 3% of the water that would be required to grow the same amount of lettuce conventionally, Malehuck said. And he says the farm’s yields per square meter will be about 400 times greater than a traditional farm. 

Kalera will also have the ability to deliver lettuce to retailers within hours of harvest, Malechuck said, which gives the product at least a four-week shelf life. Imported vegetable producers can’t compete with that.

“Our goal is to have a product that is the most superior product anybody’s ever had and price it in an affordable manner,” Malechuk said. 

The Road From Niche Market To Mass Market

With the right technology, farms can more easily achieve competitive pricing and product consistency — keys to selling to large grocers, like Costco and Safeway.

“My estimate is probably only 5% to 10% of the farmers in Hawaii have consistent sales with large grocers because it’s just very tough to do that,” Cooke said. “You can’t say, ‘Hey, we had an infestation, we can’t provide to your Foodland stores this week.’ Foodland hates that. They need to know exactly what they’re getting every single week. ”

During the 2008 economic slump, Mari’s Gardens in Mililani converted part of its ornamental landscaping business into a hydroponic vegetable farm, betting that people would be more willing to spend money on food than tropical plants. McDonald’s was its first major client. Courtesy: Mari's Gardens/2021

That’s why major grocers do a bulk of their business with mainland-based food producers, Cooke said. The local agriculture sector, as a whole, can’t provide enough volume or consistency in quality.

When MetroGrow Hawaii launched the first vertical farm in the state in an 800-square-foot warehouse in Kakaako in 2013, it focused on high-end leafy greens that are difficult to farm traditionally in the islands. 

Today the company operates out of a 2,000 square-foot warehouse, harvesting specialty items sought by chefs, including baby greens, ice plant and pea shoots

The company’s crop selection is partly designed to avoid competition with traditional farmers, MetroGrow President Kerry Kakazu said. 

Another driver lies in the fact that the company needs to stick with crops that sell at higher price points in order to recoup giant energy costs.

At its current size, Kakazu said the business is close to achieving profitability. But he wants to shift the business model away from niche products and focus instead on growing more affordable leafy greens. 

To do this profitably, Kakazu said he’ll need to scale up. He’s considering a fivefold expansion of the company’s grow space. 

The entrepreneur is also trying to cut down on labor costs by increasing automation. For example, Kakazu said he wants to automate the refilling of the farm’s water tanks.

He also wants to slash energy costs by reducing the company’s costly use of air-conditioning and finding a way to incorporate natural sunlight into the warehouse to minimize LED lighting.

“It’s always in the back of my mind that we want to help Hawaii’s food sufficiency,” Kakazu said. “We have to modify our system or greatly increase the yields to do it economically.”

Mari’s Gardens, an ornamental landscaping company in Mililani that grows produce in an aquaponic and hydroponic greenhouse, is going through a similar transition. 

After the company lost about a third of its restaurant orders due to the pandemic, it shifted its primary customer base to supermarkets. Like MetroGrow, the business is considering scaling up production to achieve more competitive pricing.

But store manager Brendon Lau said he will also need to cut costs by adopting more automation and reducing energy usage. 

High Tech Isn’t Always Better

Kunia Country Farms is home to one of the largest aquaponics systems in Hawaii. The farm grows leafy greens in a closed-loop system where the fish in the system provide nutrients for the plants to grow, and the plants act as a filter to clean the water that recirculates back to the fish.

Co-founder Jason Brand describes it as a sustainable, mid-tech farm that uses machines that border on robots only to harvest, wash and pack the produce. 

This automation helps the 3-acre farm, which produces roughly 5,000 pounds of lettuce each week, match the price of imported lettuce, Brand said.

Jason Brand warns that implementing the best technology isn’t necessarily a recipe for success in an island chain with such a limited population size. Cory Lum/Civil Beat/2020

In a big city on the mainland, Brand said it would make sense for him to invest in a fully automated farm. But if he invested in that level of technology on Oahu, Brand said he’d need to scale so large that he’d put nearly every other leafy green producer on the island out of business — something he doesn’t want to do.

“We would have to be the sole provider of all the leafy greens on the island in order to achieve the scale that we would need to reach to make back the capital,” Brand said. “Do we really want only 10 farmers on the island, each one with a fully scaled, automated system, to produce their one crop? Because economically, there would be no room for anybody else.”

Instead of investing in more automation, Brand said the farm is focused on growing as much food as it can while keeping its footprint small, something that helps reduce labor costs while preserving land for other purposes, such as housing and renewable energy projects.

That’s one of the values of the ag-tech sector— it frees up land for other uses.

As the state strives to grow more food and produce more green energy, relocating some farming into urban settings could help ease competition for land between the agriculture and renewable energy sectors, said state Sen. Mike Gabbard, chairman of the agriculture committee.

The senator said he wants to revisit a bill that died in the Legislature in 2019 that would require the Hawaii Department of Agriculture to study the feasibility of designating Kalihi, Kakaako, Moanalua and Waianae as ag-tech zones.

Incentives, such as land tax breaks, could be used to attract farmers to jump-start a new sector in urban farming, he said.

Hawaii Grown” is funded in part by grants from the Ulupono Fund at the Hawaii Community Foundation, the Marisla Fund at the Hawaii Community Foundation, and the Frost Family Foundation.

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