3 Hydro Farming and Vertical Farming Stocks – Revolutionizing an Industry

The Problem

Today’s farmers continue to face a seemingly insurmountable amount of struggles. With mounting pressure to be more environmentally friendly and cost-efficient all while producing the highest quality food in history, farmers are beginning to seek out new ways to run their business. This is where the idea of hydro farming, and vertical farming stocks have been able to grow. 

Almost all of the problems farmers face today are not due to their own malpractices. (The only thing that can be said about traditional farmers is that their agricultural practices have contributed to the depletion of the natural resources on their land.) Obviously, that is a big deal. 

However, not only are farmers dealing with environmental difficulties, they are also facing economic challenges as well. In this article from MFS Agriculture, they describe Top 10 Issues for Farmers. Some of the most eye opening issues mentioned include depleting reserves of freshwater around the world, disruptions in supply chains due to the pandemic, and high rates of food waste. 

Luckily, these three issues are all addressed by the new developments in hydro farming. 

Hydro Farming & the Growth of Vertical Farming Stocks

So, what exactly is hydro farming, also known as hydroponic farming? Hydroponics allow farmers to grow plants without soil. Instead, they use mineral nutrient solutions in liquid to grow the plants. Some of the plants that have proven to grow in this environment are tomatoes, peppers, strawberries, greens, and cannabis. Depending on the scale of the operation, all of these foods can be grown on a commercial level.

What takes the use of hydroponics to the next level is the idea of vertical farming. While hydroponics was first introduced in the 1600s, the development of vertical farming began in 1999. Conceptually, vertical farming is a bit easier to grasp than hydroponics. 

Vertical Farming

Simply, vertical farming is the practice of growing plants in vertical, stacked layers. These “plant factories” allow the farmers/scientists to have a high level of control over the plants they produce. 

With the combination of these two practices, farmers are able to produce higher yields in smaller land areas. While also being able to limit crop waste from the natural elements. Additionally, these farmers are able to predict their outputs more consistently. Also enabling them to make changes to their production levels if supply chain issues arise. 

Additionally, compared to traditional intensive farming methods, hydro farming allows farmers to use less than 1/5th the amount of water originally needed. As there is a higher push for ESG-friendly farming practices, this is a great testament to the potential of hydro farming coupled with vertical farming. 

Some of the struggles these companies face are pretty consistent with start ups. The start-up cost of a vertical farm is astronomically higher than that of a traditional farm. Additionally, the energy demands of vertical farms is relatively high due to the need of LED lights to help the plants grow. However, if renewable energy is utilized for these projects, then those costs would eventually even out. 

Hydro Farming & Vertical Farming Stock Leaders

In this section we will highlight some of the top companies pushing the adoption of hydroponics and vertical farming to higher levels. Some of the vertical farming stocks are hydroponic equipment producers or vertical farming plant producers, touching every part of this growing industry. 

The Investor Weekly provides more analysis on the top stocks growing in this market on our Substack. To access these top vertical farming stocks, trek over to The Investor Weekly Substack!

Conclusion 

In review, the future of hydroponics and vertical farming can soon become an additional part of the world agriculture system. We don’t believe it will likely replace all traditional farmers, but perhaps add another link to the supply chains that can ease the burden on the industry as a whole. Still, it will need to first become economically-sustainable before we see mass adoption. As technological advances continue to develop, we expect entry costs to continue to decrease, opening the door for the hydro farming and vertical farming stocks to grow considerably. 

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