Vertical Farming Startup Plenty to Expand via $680 Million JV with UAE’s Mawarid

In a major development for the vertical farming sector, the US-headquartered Plenty has signed a $680 million joint venture with Mawarid, an Alpha Dhabi Holding arm, to create a string of indoor farms across the Middle East. The main goal of this partnership is to eliminate food insecurity problems due to the application of innovative vertical farm technologies. We are disscusing about Vertical Farming Startup Plenty to Expand via $680 Million JV with UAE’s Mawarid.

We are disscusing about Vertical Farming Startup Plenty to Expand via $680 Million JV with UAE’s Mawarid:

Joint Venture between Plenty and Mawarid

Currently, the partnership between Plenty and Mawarid involves the construction of five indoor farms in the next five years. The first phase requires an investment of around $130 million to build an indoor farm in Abu Dhabi. Construction of this facility is anticipated to commence early next year and is likely to be completed by 2026. The farm will aim to produce over 4.5 million pounds of premium strawberries yearly for domestic consumption and export within the Gulf Cooperation Council (GCC) countries.

The CEO of San Francisco-based Plenty, Arama Kukutai said, “We are targeting returns north of 20%, which is significantly higher than traditional agriculture. In that context, we think there’s a lot of capital for the space.”

Financial and Market Potential

Plenty has raised over $940 million in funding from investors such as SoftBank and Walmart. The partnership with Mawarid represents the increasing attention paid to vertical farming as a potential solution to agriculture challenges. Some of the funding for this venture is in the form of debt from a specific bank within the region, which is an exciting but viable source of financing for capital-intensive indoor farming businesses.

The CEO of Mawarid, Kashif Shamsi, said, “We’ve been looking to bring food security into the UAE. We want to offer a solution which was able to deal with the issue of scarce land and scarce water, and could pivot to different crops if necessary.”

Technological Advancements and Sustainability

Vertical farming technology has been improved over the recent past to ensure that crops of high quality can be produced in environmentally controlled structures. Such facilities employ LED lights, air conditioning, and hydroponic or aeroponic systems to encourage plant development. Vertical farms also reduce the use of pesticides and water consumption, which are beneficial in the long term.

Due to the high costs incurred in establishing new structures, physical capacity output has remained relatively low. However, the collaboration of Plenty and Mawarid has the potential to address these challenges due to the rich resource endowment of both companies. The Abu Dhabi farm’s strawberry produce has already found customers in Driscoll’s, which is prominent in the berry market. 

A Sustainable Solution

The Middle East is particularly vulnerable to food insecurity concerns because of its climate and level of agricultural development. Vertical farming, which uses controlled structures for multiple layers of crops, is a viable solution. Compared to traditional farming, this method requires less water and space and is hence suitable for practice in areas with limited natural resources. 

Aim and Global Prospects of the Partnership

Plenty and Mawarid’s collaboration is the key to developing the vertical farming business. The partnership will improve food security and sustainable agriculture and generate economic benefits throughout the region by creating a network of indoor farms in the Middle East. The positive outcome of this project may inspire people in other parts of the world who are experiencing similar issues to try the same. As the population increases globally and climate change affects multiple sectors, including farming, techniques such as vertical farming will prove vital for food security.

Conclusion

The $680 million deal between Plenty and Mawarid is a significant step in the vertical farming business. This strategic partnership of technology, funding, and sustainability has the potential to revolutionize agriculture in the Middle East and beyond. 

Vaisakh V K

My experience is in interactive, digital and social media marketing techniques, strategies and tools in marketing, public relations, and media relations.