Towards the Spread and Growth of Plant Factories

Yusuke Uwabo
Senior Consultant

May 22, 2009 (Friday)

Recurring abnormal weather, a global food scramble, and the problem of fake agricultural products have put Japan’s “food” in a critical situation. “Plant factories” are garnering attention as a way to yield agricultural products by controlling the growth environment within plants (light, temperature, humidity, concentration of carbon dioxide, and etc.) using various sensors.

The greatest benefits of plant factories are high productivity per unit area under an optimal and clean growth environment; stable (quality, amount, period) and safe production; and ease of securing workers with year-round production and consistent farming work. In addition, because production does not depend on location, it is possible to reduce distribution costs by building the plant near the consumption destination.

Compared with general horticulture, however, plant factories require significantly higher start-up and operational costs as well as energy consumption. That there are few examples of plant factories currently turning a profit is an obstacle to their growth.

The Japanese government has begun proactive support to promote plant factories. The spread and expansion of these factories were specified in the “Follow-up and Revision of New Economic Growth Strategy,” approved by the Cabinet in September 2008. The Agricultural Commerce Plant Factory Research Working Group was set up, and examination of revising the legal system for research and development support for and introduction of plant factories has steadily progressed.

Plant factories will receive government support, and are the subject of rising expectations. From the perspective of producers (those who introduce plant factories), however, strategies for overcoming costs and securing profits for sustainable production are important. Moreover, with only simple production there are concerns that plant factories will face the same kind of price competition seen in traditional agriculture. A look at best practices shows that differentiation from other agricultural products; maintaining prices based on trust with consumers; and how to strategically develop from production to sales are the keys to success.