Interest in vertical farms grows with demand for Canadian products

Vertical Farming Interest Growing | David Israelson |

While U.S. tariffs threaten much of the Canadian economy, business is booming for an Ottawa-based startup that builds indoor farming units for made-in-Canada produce – also known as vertical farms.

Increased consumer interest in local produce could be attributed to looming uncertainty regarding the impacts of tariffs on agriculture and cross-border food trade, though much of our food exports, for now, will be exempt from the 10-per-cent baseline tariff.

“The phones have been ringing off the hook,” says Corey Ellis, co-founder and chief executive officer of Growcer, an Ottawa-based vertical farms supplier. “Our customers are seeing a ton of demand from Canadians across the entire country who want to buy local veggies instead of American products.”

Growcer has already supplied modular vertical farming units to 110 customers across Canada, including First Nations, co-op grocery stores, community colleges and non-profit organizations. The units cost $250,000 plus shipping, and they are made at the company’s factory in Winkler, Man. Each farming unit is 40 feet long, 10 feet high and 10 feet wide, amounting to the size of a cargo container.

“A lot of our customers are selling out their produce now and looking to expand,” Mr. Ellis says. “If this trend continues, we’re going to see a lot more vertical farms across the country in the next year to year-and-a-half.”

Growcer is part of a larger move toward indoor vertical farming – the process of growing produce on shelves indoors instead of underground – in Canada and other countries where growing seasons are limited.

Lenny Louis, CEO of Vision Greens, a vertical farming company based in Welland, Ont., says the market for homegrown produce is expanding. His business raised $20-million in the past year and recently broke ground to expand its indoor farm. “Demand has accelerated tremendously since the tariff threats started, from both stores and from shoppers,” he says.

“When our expansion is ready in the next few months, we’ll grow 1.5 million pounds of lettuce a year – three times as much as now.”

Unlike large indoor farms such as the Vision Greens facility, Growcer’s units are compact and designed for small spaces and customers. Since the company was founded in 2015, Growcer’s clients have used the organization’s farms to produce more than 10 million servings of green vegetables.

But even with the surge of interest, it’s unlikely growing vegetables indoors will meet all of Canada’s daily demands for fresh produce any time soon, says Lisa Ashton, agriculture policy lead at RBC’s Climate Action Institute. “Indoor vertical farming could evolve as a mainstream source of food across Canada, if it improves the business case in scaling production,” she wrote in an article last July.

To boost its business case, Growcer offers the option of buying into its vertical farming system through its partnership fund called Growcer Fund, which allows customers to provide an upfront investment of up to 75 per cent lower than buying the farm outright. It’s a partnership between the farm operator and the fund that allows for shared risk and revenue. Throughout its duration, the customer can choose to buy the unit or continue with the partnership.

One of Growcer’s customers is Nipissing First Nation, a band of 3,000 near North Bay, Ont. In three Growcer vertical farming units branded Mnogin Greenhouse, the community grows lettuce, spinach, arugula, kale and herbs.

Mnogin Greenhouse operates an online store and markets to its own community, as well as several nearby high-end restaurants and retailers, says Makenzie Jones, Mnogin Greenhouse’s greenhouse manager and head grower.

“Since the tariff threats started, we’re seeing a clear uptick in interest,” Mr. Jones says. “E-mail inquiries have gone up, and I receive about eight calls every week from people asking how to get their hands on our products. Before, I’d get maybe one or two calls a month.”

While customers appreciate that Mnogin Greenhouse is an Indigenous and Canadian business, Mr. Jones says he believes they’re also attracted to quality. “The greens taste like they’re grown in the perfect environment,” he says.

Another Growcer customer, the Toronto-area non-profit Reena Foundation, supports people with autism, developmental disabilities and mental health challenges. The organization started vertical farming to augment its mission to provide housing and jobs to people with diverse health needs. In 2023, it set up an agricultural offshoot called GReena, opening a Growcer unit in Vaughan, Ont., as Canada’s first accessible modular farm.

The produce from the GReena farm unit is shipped less than 100 metres to a foundation-run catering facility that prepares kosher meals for its residences. ”Because we serve the Jewish community, we need to produce kosher produce,” says Fred Winegust, Reena Foundation’s program manager who launched GReena. Kosher greens must be certified as free from bugs, and the modular units help keep insects out, he says.

Vertical farmers can face challenges dealing with red tape. For example, Mr. Louis says his Welland operation is zoned as “light-industrial” land rather than “agricultural,” which is cheaper. Mr. Jones of Mnogin Greenhouse says he would like to see a special hydro rate for growers.

However, modular farms can be easier to operate, and the produce does not have to be shipped across the continent. Best of all, they’re Canadian, Growcer’s Mr. Ellis says.

“It’s great to see the increase in demand for Canadian produce now, but it would be even better if it lasts beyond the current tariff crisis. We want to see more farmers growing produce right here, all year round.”

Original Article: https://www.theglobeandmail.com/business/industry-news/property-report/article-interest-in-vertical-farms-grows-with-demand-for-canadian-products/

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