June 7, 2023 — International Fresh Produce Association (IFPA) BB #:378962 hosted a special networking and engagement session with retailers and Controlled Environmental Agriculture (CEA) producers at this year’s Retail Conference held in Oak Brook, Illinois.
The meeting featured guest speaker, Investor and Chairman of Equilibrium, Dave Chen, who spoke about the opportunities ahead for CEA and Retailers and provided attendees with time for roundtable discussions to learn more about challenges and possibilities at both ends of the supply chain.
“This was a unique opportunity to bring together CEA and Retailers at the Retail Conference this year,” said Vonnie Estes, IFPA vice president of Ag Innovation. “It’s easy to talk about the potential for CEA or rely only on the headlines around CEA startups, but bringing these two groups together allowed us to discuss the scalability of indoor grown products that meet consumers and retailers’ needs for locally grown, fresh produce with fewer inputs.”
Takeaways from the discussion included:
- False “Competition”: there is a tendency, as these new technologies emerge, to set them against each other in a race towards the “best” solution. Chen stressed the importance of thinking about CEA as a set of application tools that includes everything from hoop-houses to glasshouses and vertical farms. They are all tools to be used to solve a problem.
- The CFO role is hugely important for the success of CEA. Chen noted that as an asset intensive industry, the traditional startup philosophy of “failing fast” is not financially feasible for many growers. Approaching the implementation of new growing solutions with the CFO mindset of balancing risk and profitability will be key to innovations that stick. Balance sheet structure is a competitive advantage.
- Breeding takes time. Those in the CEA space should take advantage of the incredible depth of knowledge and research by current seed-breeders. If CEA innovators are looking for certain varieties or traits, starting from scratch will take a decade at least. Find your seed-breeding partners to accelerate the work.
“This meeting between Controlled Environment Agriculture (CEA) producers and suppliers and grocery retailers is a first for the industry,” said Abby Prior, chief commercial officer at BrightFarms. “The group represents the full supply chain, collaborating to meet the growing demand for locally sourced, fresh, and environmentally conscious produce. The CEA segment is in a crucial growth stage and the discussions aligning needs and expectations of the group is an important step forward.”
In the table top discussion, participants addressed two questions:
- What does CEA (Controlled Environment Agriculture) and retail need to do to communicate CEA benefits to consumers? Participants discussed the need for a simplified and unified labeling system on packaging to convey information about sustainability, longevity, taste, flavor, and local/regional aspects. They emphasized the importance of educating consumers about the unique benefits and flavor profiles of CEA products. They also mentioned the significance of transparent communication between CEA industry and retailers regarding future varietals, price points, and long-term commitments.
- How can CEA and retail grocery help each other? The discussion focused on the mutual needs of CEA and retail grocery for success. Participants communicated the importance of dependability, quality, and freshness of CEA products, which can help retailers meet consumer expectations and create value in the category. They also discussed the need for consistent production, proper planning for promotions, and access to consumers through retail channels and social media. Additionally, participants highlighted the importance of innovation in CEA, such as specialty lettuces and unique flavors, as a differentiating factor from traditional farming.
Overall, the discussion revolved around the need for transparent communication, education, simplified messaging, and a focus on product quality to effectively convey CEA benefits to consumers and establish a mutually beneficial relationship between CEA and retail grocery.
The Retail Conference will continue on Wednesday and Thursday June 7 and 8th with a Golf Tournament and a day of educational sessions focused on retail and consumer data, produce prescriptions, FSMA, and more.
About the International Fresh Produce Association (IFPA)
The International Fresh Produce Association (IFPA)?is the largest and most diverse international association serving the entire fresh produce and floral supply chain and the only to seamlessly integrate world-facing advocacy and industry-facing support. We exist to bring the industry together to create a vibrant future for all. We grow our member’s prosperity by conducting advocacy; connecting people and ideas; and offering guidance that allows us all to?take action?with purpose and confidence.?
Contact: Ashley Sempowski, ASempowksi@freshproduce.com , (202)-303-3406