'Sustainable agriculture is fully local': Vertical farming start-up eyes ready-to-eat salad market
Atlantic Farms takes issue with the number of food miles travelled between field and plate.
Using loose-leaf salads as an example, the Spanish start-up says in Europe, each bag travels more than 15,000 to reach the consumer. This figure is concerning, suggested CEO Rafael Pereira, given that 60% of households in Europe consume salad regularly.
âThis journey is repeated six days a week and 52 weeks a year. It starts in [the field] and goes to different factories across Europe. After a long journey of 2,000km, 48 hours later, the food finally reaches consumers,â âhe told delegates at start-up accelerator Eatable Adventureâs demo day this week.
This process â based on a conventional, centralised model â is unsustainable, Pereira stressed. âIt results in a carbon footprint of 1kg COâ for every 1kg of product.ââ
High-tech cultivation systemâ
Atlantic Farmsâ solution is localised, rather than centralised. âWe produce what consumers are demanding: a local product free of pesticides, packaged in compostable materials, and adapted to local markets and local tastes,â âsaid Pereira.
Specifically, the start-up is leveraging vertical farming and âhigh-techâ greenhouses that can adapt to âany climate or locationâ. âIt makes cultivation possible in the most extreme climates in the world, from the Emirates to Greenland.ââ
The start-up claims its cultivation methods are more environmentally friendly than conventional agricultural practices. Specifically, the CEO said its production methods reduce its productâs carbon footprint by 90%, its hydroponics use 95% less water, and reduces fertilizer use by 55%.
The salads will be packaged in compostable materials, which Pereira said âeliminates 2,000 tonnes of single-use plastic from the marketâ.
Market opportunityâ
Atlantic Farms is convinced the ready-to-eat salad market has much potential. As it stands, the market is valued at âŹ2.3bn across the âfive main markets in Europeâ, with a projected annual growth rate of 8.2%, we were told. This will take the market value up to âŹ4.2bn by 2028.
Compared to consumption rates in the UK, Europe has far to go. âConsumption in Europe is only 1.75kg compared to the mature market of the UK which is 7.5kg per capita. This indicates the growth potential of the market,â âelaborated the CEO.
Concerning competition, Atlantic Farms says other players have âidentical product packaging and value propositionsâ, and propose the âold way of doing agricultureâ, which involves imported production.
The start-up is targeting regional retailers â a sector that largely aligns with Atlantic Farmsâ â100% localisedâ approach. With a market share of 50% in their âinfluence areasâ, the CEO said regional retailers are often looking for âdifferent local and sustainable productsâ that differentiate themselves from the competition.
âThanks to our process of optimisation, we offer the best product in the market with an additional 5% profitability for our customers,â âhe continued.
Atlantic Farms seeks to be stocked in major Spanish regional retailers such as Eroski, Frutas Nieves, and Grupo Cuevas. This would give the start-up more than 300 points of sale.
By 2022, the start-up will be cultivating salad varieties over one hectare to produce 300,000kg worth of product. In the future, it expects to have increased capacity to 18 hectares, with volume increasing to 5.8m kgs.
In the first year, Atlantic Farms expects to boast a turnover of âŹ3m. By 2030, the start-up says this will have increased to âŹ55m, with an EBIDTA of âŹ38m and a contribution margin of +65%.
âToday, sustainable agriculture is fully local,â âthe CEO concluded, âand local is fully sustainableâ. â