Global Smart Agriculture Market Expands as Cultivators Realize Potential Benefits of Greenhouse Farming

PALM BEACH, Fla., Dec. 2, 2021 /PRNewswire/ -- FinancialNewsMedia.com News Commentary - Increasing automation of commercial greenhouses and growing implementation of the Controlled Environment Agriculture (CEA) concept in greenhouses, in a bid to obtain higher yield and maintain optimum growing conditions, are the key factors driving the demand. Cultivators are realizing the potential benefits of greenhouse farming, which has increased the development of commercial greenhouses. Cultivators have shifted focus from the conventional lighting systems to LED grow lights as the latter can be easily integrated into a CEA setup. Although LED grow lights are expensive, they are considered ideal for indoor farming owing to their long-term benefits in terms of energy efficiency. A report from Grand View Research said that the global smart agriculture market size was valued at USD 13.15 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 10.6% from 2021 to 2028. The report said: "Based on agriculture types, the smart farming market has been segmented into precision farming and smart greenhouse and others. The market estimates and forecasts of the smart greenhouse segment includes vertical farming. Smart greenhouse enables farmers to cultivate crops with minimal human intervention. Climatic conditions such as soil moisture, temperature, and humidity are continuously monitored, and any variation observed in them triggers an automated action. Active Companies in the markets today include AgriFORCE Growing Systems Ltd. (NASDAQ: AGRI), Bunge (NYSE: BG), The Scotts Miracle-Gro Company (NYSE: SMG), Corteva, Inc. (NYSE: CTVA), Nutrien Ltd. (NYSE: NTR).

Grand View Research added:  "Smart farming is an integrated approach to manage farming activities, such as preserving resources and optimizing yields, with the implementation of IoT and information communication technologies. Smart farming entails real-time data on the conditions of soil, air, and crops. It aims at ensuring profitability and sustainability of the farm yield while protecting the environment.  The application of smart greenhouse includes water and fertilizer management, HVAC management, yield monitoring, and others. HVAC management segment is expected to portray a significant growth over the forecast period owing to its increased usage in smart greenhouse farming. The need for maintaining different temperatures and humidity for hydroponic grow room and aquaculture area drives demand for the HVAC management segment."

AgriFORCE Growing Systems Ltd. (NASDAQ: AGRI) BREAKING NEWS:  AgriFORCE Signs Definitive Contract to Deploy Its Proprietary GrowHouse Facility and IP in Barbados for Production of High Value Medical and Agricultural Crops -  AgriFORCE Growing Systems Ltd. ("the Company"), an Intellectual Property (IP) -focused AgTech company dedicated to advancing sustainable cultivation and crop processing across multiple platforms, has signed a definitive contract with Humboldt Bliss, Ltd. ("Humboldt"), an agriculture and aquaculture business based in Barbados, West Indies. The contract is for the deployment of the AgriFORCE foundational IP – which includes a proprietary facility design, production and operation technologies and methods, and an automated growing system (the AgriFORCE "GrowHouse") for the cultivation and sale of high value medical and agricultural products into the Caribbean and global pharmaceutical and agricultural markets.

Under the terms of the contract, AgriFORCE is responsible for constructing its proprietary facility and providing the full Standard Operating Procedures (SOPs) of the AgriFORCE GrowHouse and Humboldt is responsible for securing the project's land as well as operating the facility. Upon production, Humboldt has committed to remit an IP licensing, management services and equipment leasing fee to AgriFORCE for up to 14,300 pounds (6,500 kgs) of high value medical and agricultural crops per year. Based on AgriFORCE's internal financial modelling and current market index pricing, the Company believes that the contract represents $12.7M of annual recurring EBITDA.1 As the initial contract is for a five-year-term, the Company believes this represents more than $63M in EBITDA1 over the initial term and with two five-year automatic renewals, it anticipates the total contract EBITDA1 could be up to approximately $190 million. The contract will be backed by a rolling $5 million performance bond maintained by Humboldt.

AgriFORCE CEO Ingo Mueller, stated: "Finalizing this agreement is exciting, and we are looking forward to deploying our GrowHouse facility in Barbados.  We believe that this facility may generate over $12 million of EBITDA1 per year based on current contracts with the potential to further expand production based upon up to a further 50% of available installed capacity.  Moreover, we have a robust sales pipeline and we believe this is only the first of several agreements to roll out our GrowHouse facilities in the coming months." He continued: "Like many Caribbean countries, Barbados has a challenging tropical climate and unique soil conditions that make some areas of agriculture such as high value medical and agricultural products a real hurdle to overcome. Our proprietary facility design and automated growing system and methods addresses these issues and provides the ability to grow a range of crops that would be too difficult to grow otherwise."

The AgriFORCE team sees this finalized agreement as an exceptional opportunity to showcase their IP and to help to create high paying and technical jobs for the people of Barbados, contributing to the country's economic future. Said Mueller: "We anticipate that along with creating significant cashflow for the Company, this contract will lead other Caribbean countries and countries with tropical climates to appreciate the value of our IP and how we can help contribute to their economies, employment markets and, of course, help to advance agriculture in their regions."

 "The opportunity to use the AgriFORCE IP to grow crops in a sustainable and profitable way in a challenging climate is exciting for the Humboldt team." Says Robin P. Cho, Director from Humboldt. "With the AgriFORCE business model, we are confident that we will quickly produce a strong revenue stream that will contribute directly to the Company's bottom-line as well as to the country's domestic and export market. It is a major achievement for everyone involved, especially for Bliss and Barbados."  CONTINUED…  Read this full release for AgriFORCE Growing Systems at:  https://ir.agriforcegs.com/ 

Other recent developments in the markets include:

Bunge (NYSE: BG) a global leader in agribusiness, food and ingredients, recently announced science-based targets (SBTs), highlighting its commitment to reduce greenhouse gas emissions within the company's operations and throughout its supply chains. The announcement comes following a joint statement by Bunge and other agriculture leaders at the United Nations Climate Change Conference (COP26) to accelerate industry action towards fighting climate change.

"Today's announcement underscores our continued leadership in providing low carbon and sustainable solutions for the production of food, feed and fuel to consumers around the globe. This not only reinforces our focus on making real progress toward climate action in our operations and across our value chains, it also further enables growth opportunities into new markets for our company," said Greg Heckman, Bunge's Chief Executive Officer.

The Scotts Miracle-Gro Company (NYSE: SMG), the world's leading marketer of branded consumer lawn and garden as well as indoor and hydroponic growing products, recently released record full year financial results driven by a company-wide sales increase of 19 percent and continued growth in all major operating segments.

The Company also established guidance for fiscal 2022 that includes non-GAAP adjusted earnings of $8.50 to $8.90 per share on company-wide sales growth of 0 to 3 percent, both of which will be aided by a second pricing action in the U.S. Consumer segment to mitigate commodity inflation. The Company also said it plans to repurchase up to another $300 million in shares during fiscal 2022.

For the year ended September 30, 2021, company-wide sales increased 19 percent to a record $4.93 billion, compared with $4.13 billion a year earlier. GAAP earnings from continuing operations were $9.03 per diluted share, compared with $6.78 per diluted share in the prior year. Non-GAAP adjusted earnings, which are the basis of the Company's guidance and exclude impairment, restructuring, and other non-recurring items, were $9.23 per diluted share compared with $7.24 per diluted share a year ago.

Corteva, Inc. (NYSE: CTVA) Corteva Agriscience, one of the world's largest agriculture companies, and Manna Irrigation, a leading provider of irrigation intelligence software solutions, have recently announced a new contract to enhance effective irrigation practices. Corteva Agriscience implemented the Manna Irrigation Intelligence solution in more than 4,000 hectares in Austria across multiple locations. With the Manna solution, hundreds of corn seed growers improved their crop management practices, boosting seed production metrics and promoting sustainability.

Manna's software-only solution leads the trend in crop management decision-making driven by virtual sensors. It provides growers with actionable insights on how much and when to irrigate, based on a combination of remote sensing data, pinpointed weather information, and crop-specific models. Manna's mobile-friendly app removes the need for sensor installations and maintenance and provides real-time notifications about crop development issues, as detected by analysis of high-resolution and high-frequency satellite images.

Nutrien Ltd. (NYSE: NTR) recently announced its third quarter 2021 results, with net earnings of $726 million ($1.25 diluted earnings per share). Third-quarter adjusted net earnings¹ were $1.38 per share and adjusted EBITDA was $1.6 billion.

"Nutrien delivered record earnings in the third quarter driven by the decisive actions we made across our business units and leveraging our competitive advantages to benefit from strong market fundamentals. The results demonstrate our ability to efficiently and reliably deliver crop inputs and services to our customers amid global supply uncertainties, and we remain focused on our essential role to support global food security and sustainable food production," commented Mayo Schmidt, Nutrien's President and CEO.

"We are raising full-year 2021 adjusted earnings guidance and expect this positive momentum to continue into 2022. We expect to generate significant free cash flow and to meaningfully strengthen our balance sheet through debt reduction, providing flexibility to deliver on future growth opportunities and return cash to shareholders," added Mr. Schmidt.

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