(Bloomberg) -- A few days after Hurricane Fiona slammed Puerto Rico with catastrophic flooding and whipping winds that destroyed much of the island’s agriculture, Francisco Santana was packing a box of bright green lettuce for delivery. “We’re the only ones in this part of Puerto Rico that have something to ship right now,” he said.
Santana is the founder and CEO of an indoor vertical farming company, Grupo Vesan. His delicate produce had survived the Category 1 storm because it was germinated, nurtured and harvested inside an 8,000-square-foot hydroponic warehouse on the island’s hard-hit southern coast.
Hurricane Fiona showed, once again, how vulnerable the US commonwealth of 3.1 million people is to extreme weather supercharged by climate change. The storm knocked out power to the entire island, washed away roads and bridges and caused billions of dollars in damage. It also devastated the island’s farmers, just as many were beginning to recover from 2017’s Hurricane Maria.
Fiona caused at least $100 million in crop damage, Puerto Rico Agriculture Secretary Ramón González Beiró estimates.
“The vast majority of our plantain and banana crops were destroyed,” he said in a statement. “We’ve also lost crops of citrus fruit, papayas, vegetables, coffee and livestock, among others.”
Even in the best of times, Puerto Rico and many small islands like it across the Caribbean are on the edge of hunger. The island imports more than 85% of all its food. And what is grown here faces constant threats from storms and drought.
That’s what makes the idea of indoor farming — or controlled-environment agriculture, as the industry sometimes bills it — compelling, says Anabelle Broadbent, a Puerto Rican food scientist and microbiologist who has worked extensively on ag tech projects.
“We’re in hurricane alley, and leafy greens cannot be grown outside with storms, floods, iguanas,” she said in a phone interview. “Indoor farming is not competing with traditional agriculture that can do fine outside, but it is great at growing these very fragile plants.”
Once the preserve of green-thumb geeks and cannabis growers, indoor farming has burst into the mainstream and piqued investor interest as the world wrestles with how to feed a booming population. Brooklyn-based Upward Farms announced early this year that it’s building the world’s largest vertical indoor farm in Pennsylvania. Not to be outdone, California startup Plenty Unlimited Inc. recently announced plans for what it called the world’s largest indoor vertical farming campus in Virginia.
In Puerto Rico, indoor farming is still an oddity. While outdoor hydroponic farms are growing in popularity, only a handful of operations are moving their crops inside, where everything from light to humidity to carbon dioxide levels can be controlled. By creating high-yield indoor farms close to consumers, Santana’s Grupo Vesan and companies like it are able to churn out pesticide- and herbicide-free produce at rates that can compete with traditional agriculture.
Fusion Farms, an aquaponic company in Mayagüez, is trying to muscle in on the leafy green market with the help of Monllor Capital Partners, a Puerto Rico-based investment fund focused on ESG, which took an undisclosed stake in the operation. Farm in the City, another Puerto Rican start-up, is converting shipping containers into mini hydroponic farms.
In his chilled warehouse, Santana is growing 10,000 heads of lettuce at a time in racks stacked seven levels high. With a staff of just three, he harvests 12 times a year, selling fresh lettuce to local bakeries and grocery stores for $1.30 to $1.60 a head — about a third of the price of imported romaine.
Santana also sells special-built container farms, and still uses some to experiment with exotic (for the Caribbean) crops like strawberries and mint. He’s been in talks with investors about expanding his operation and creating an education and research center to promote indoor agriculture across Puerto Rico.
Even so, he says his operation, tucked into an industrial park near Puerto Rico’s second-largest city, Ponce, often faces skepticism from traditional farmers. Why would you move plants indoors on a tropical island that gets plenty of sunshine and rain?
“If I were planting outside, I would need a huge space,” he said. “Outside, crops are so vulnerable. Let’s not even consider hurricanes, but often it’s overcast or there’s not enough rain.”
But indoor farming has its challenges. Santana has been in a long-running fight with the Puerto Rican government agency that leased him the building he’s using but is now trying to break the contract. He also has to deal with punishing energy bills. Ten days after Fiona, his part of the island was still without power.
The previous day, Santana had spent seven hours trying to find diesel to keep his backup generators running — critical to keeping water flowing and the air cool in his grow room.
“If I didn’t find the diesel yesterday, you and I would be having a very different conversation,” he said. “You’d be watching me throw away my crop.”
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