Grown from necessity: Vertical farming takes off in aging Japan

A sorting and packing line at a facility in Kyoto that grows lettuce using vertical farming techniques: 30,000 heads of lettuce grow here daily, under artificial light and with barely any human intervention. This “vegetable factory,” using the latest vertical farming techniques, is part of a trend born out of necessity in Japan. (AFP)
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Updated 01 January 2020

Grown from necessity: Vertical farming takes off in aging Japan

  • Traditional agriculture faces a double threat from an older population and migration to the cities

KYOTO: The nondescript building on an industrial site near Kyoto gives little hint to the productivity inside: 30,000 heads of lettuce grow here daily, under artificial light and with barely any human intervention.

This “vegetable factory,” using the latest vertical farming techniques, is part of a trend born out of necessity in Japan, where traditional farming faces a double threat from the aging population and migration toward the cities.

With the average age of a farmer in Japan at 67 and few candidates to replace those dying out, the country has been forced to become a pioneer in so-called vertical farming.

Globally renowned firms such as Panasonic, Toshiba and Fujitsu have tried their hand — converting old semi-conductor production lines with varying levels of success.

One of the few companies to turn a quick profit, Spread produces 11 million heads of lettuce annually from its latest factory in Kyoto, a vast sterile area where the vegetables are stacked on shelves several meters high.

Machines shift the lettuces around the factory to areas where the light, temperature and humidity are ideal for that stage of growth. The process works without soil or pesticide, and only a dozen or so humans are employed to collect the lettuce at the end.

Other countries have employed vertical farming techniques — notably in Denmark and the US — but Japan’s population crisis means the farmers are dying out, with question marks over how the world’s third-biggest economy will feed itself.

“Given the lack of manpower and decline in agricultural production, I felt a new system was needed,” said Shinji Inada, Spread’s boss.

Spread has taken some time to make the process nearly fully automated: an older factory in Kyoto still employs several dozen humans to move the lettuce — a “difficult task,” admits one staff member.

But the advantages are clear: “We can produce in large quantities and at a stable rate all year round, without being affected by temperature changes,” said Inada.

“The other benefit is that we have few losses because our products are preserved for longer,” added the vegetable tycoon.

Inada said that the firm initially experienced some difficulty in selling the lettuce, but they have now grown a good brand by producing consistent quality at a consistent price — in a country where prices vary considerably depending on the season.

Spread’s lettuce are found on supermarket shelves in Kyoto and the capital Tokyo and Inada has grand expansion visions to move production closer to where the vegetables are consumed.

The firm is building a factory in Narita near Tokyo and is eyeing further afield to countries where the climate is not suited for such agriculture. “We can easily export our production system to very warm or very cold climates to grow lettuce,” said Inada.

But is this system environmentally friendly? Inada said that he hesitated before launching the concept over this very question but finally reasoned the pros outweighed the cons. “It’s true that we use more energy compared to production using the sun, but on the other hand our productivity is higher over a similar surface area,” he said.

The system allows the firm to produce eight crops of lettuce per year, irrespective of the season. Spread also uses significantly less water than traditional agricultural methods. “I believe we are contributing to a sustainable agriculture for our society,” Inada said.

Japan already has about 200 lettuce factories using artificial light but the majority of these are small-scale. However, according to specialist consultancy group Innoplex, such factories will double in number by 2025.

And other companies are jumping on the smart-agriculture bandwagon, with Mitsubishi Gas Chemical building a factory in northeastern Fukushima that will produce 32,000 heads of lettuce daily.

Nor is its just lettuce: Tomatoes and strawberries grown by computer under artificial light are on their way to a table near you.


Customers in Saudi Arabia still prefer visiting supermarkets: BinDawood CEO

Updated 41 min 51 sec ago

Customers in Saudi Arabia still prefer visiting supermarkets: BinDawood CEO

  • Pandemic food supplies maintained, no panic buying in Saudi Arabia as retailer’s profits rose 7 percent

JEDDAH: When the coronavirus disease (COVID-19) pandemic lockdowns started in early summer last year, media reports about stockpiling became common place.
Industry data in the UK showed that in one week in March, at the start of the first lockdown, sales of toilet paper surged 64 percent, while flour was up 73 percent, and pasta 55 percent.
While memes of toilet-roll stockpiling began trending on social media, in Saudi Arabia this did not occur, according to Ahmad BinDawood, CEO of BinDawood Holding, one of the Kingdom’s biggest supermarket operators.
He told Arab News: “We have seen some of the pictures of what was happening around the world. The operation level that happened here, especially from the government side and us as retailers, and from the customers’ side, was amazing.
“There was no shortage, we made sure that there were enough supplies always in the market and customers were also responding to that positively.
“If they don’t need something they won’t buy it. They weren’t doing any excessive buying. It was a smooth flow of goods coming to the market. The supply was there, and we have successfully passed the difficult times of 2020,” he said.
With people spending more time at home, the digital revolution was sent into overdrive. Luckily, BinDawood had invested in its online presence four years ago. “We immediately responded to the changes that were happening with consumers when it came to shopping.”
He noted that customers made fewer visits to physical stores but purchased more items online.
“What we have seen from customers during the pandemic was they have started coming less frequently, but with bigger basket sizes; that was one of the major changes. Second, customers preferred buying their ingredients and cooking at home to avoid possibly contaminated food. We responded immediately to the ingredients that the customers were looking for in our social media platforms,” he added.
While the company’s online orders soared, BinDawood pointed out that Saudi consumers still preferred going to a physical store.
“The primary way that the customer prefers to shop is actually visiting the stores, not through online. Online shopping is still going to be good for the future but so far we see that the customer prefers to shop in stores to have that experiential element when they come,” he said.
Uncertainty surrounding the COVID-19 pandemic did not impact the firm’s balance sheet. In March, BinDawood Holding Co. reported a net profit after Zakat and tax of SR447.7 million ($119.39 million) for 2020, up 7 percent year-on-year.
The family business opened its first supermarket in 1984, having previously operated gift shops and perfumeries targeting pilgrims.
“The first supermarket was opened by my father and my uncles and that was in Makkah under the brand name BinDawood, and then from there we expanded and opened different stores within the city of Makkah.
“We then moved to Jeddah, then Madinah, and the acquisition of Danube took place in 2001.”
With the two brands, BinDawood and Danube, BinDawood Holding has a network of 74 stores in 15 cities throughout Saudi Arabia. In 2019, the company announced plans to reach 100 stores by 2024, meaning an average of five to six stores per year. It is now looking at opportunities for expansion in terms of product offerings and within different formats.
In December, BinDawood revealed that its first international Danube store outside the Kingdom would be located in Bahrain. The 5,305-square-meter hypermarket in the Al-Liwan Project is expected to open its doors to customers on Oct. 4.
The company also has wider international plans, and according to a Bloomberg report was looking at possible acquisitions in neighboring countries.

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Nintendo profits boom on healthy sales of its Switch as people stuck at home play games

Updated 07 May 2021

Nintendo profits boom on healthy sales of its Switch as people stuck at home play games

TOKYO: Nintendo Co.’s profit for the fiscal year that ended in March jumped 86 percent on healthy sales of its Switch handheld machine as people stayed home due to the pandemic, turning to video games for entertainment.
Annual profit for the Japanese maker of Super Mario and Pokemon games totaled 480.4 billion yen ($4.4 billion), up from 258.6 billion yen the year before. The results, released Thursday, were better than the company’s internal profit forecast of 400 billion yen ($3.7 billion).
Sales rose 34 percent to 1.76 trillion yen ($16 billion), the company said.
In game software sales, demand remained strong for “Animal Crossing: New Horizons,” with 20.85 million units sold for cumulative sales of 32.6 million units. “Mario Kart 8 Deluxe” and “Ring Fit Adventure” also were popular.
Kyoto-based Nintendo said digital downloads for the Switch also did well, helping to support its bottom line.
But Nintendo said it didn’t expect such good fortune to persist through the current fiscal year, which ends in March 2022. It is forecasting a 29 percent drop in profit to 340 billion yen ($3 billion).
Nintendo said it has attractive games in the works, including a collaboration in the mobile sector with Niantic on an application featuring Pikmin for smart devices. It expects to release that in the second half of 2021.
Other software titles planned for global release later this year include “Mario Golf: Super Rush,” and “The Legend of Zelda: Skyward Sword HD.” A new Pokemon game is planned for late 2021, according to Nintendo.
Nintendo is among companies that have thrived during the pandemic, which is wreaking havoc on the global economy overall.
Its Super Nintendo World theme park in Osaka, Japan, built with Universal Studios, opened in March after a delay due to the pandemic. But it closed soon afterward because Osaka is one of several areas under a state of emergency due to a surge of new coronavirus cases.
The state of emergency began last month and is certain to be extended beyond its May 11 end, as all such large-scale facilities are being asked to close.


Renewables set to grow far faster than oil sector

Updated 07 May 2021

Renewables set to grow far faster than oil sector

  • Models show renewables meeting 74% of total energy demand by 2050

OSLO: Renewable energy will account for a far larger share of global supply in 2050 than major oil companies or the International Energy Agency (IEA) expect, Oslo-based consultancy Rystad Energy said on Thursday.
Its updated models show renewables meeting 74 percent of total energy demand by 2050, compared to 43 percent, 45 percent and 69 percent in the most aggressive scenarios from energy firms Equinor, Shell and BP.
The IEA expects renewables to account for 35 percent of the market by 2040.
The renewed commitment to the Paris climate agreement by the US this year, the growing number of countries with net zero carbon emissions targets for 2050 and renewable technology development have changed the energy landscape, Rystad CEO Jarand Rystad told an online conference on Thursday.
“All previous assessments have to be scrapped and we need to look at it with completely new eyes,” he said.
Rystad Energy sees the sales of battery electric vehicles (BEVs) rising to 64 million by 2030, compared with oil company scenarios ranging from 22 million to 38 million and an IEA estimate of 30 million.
Rising renewable energy output amid falling costs and increasing efficiency of solar panels and wind turbines, as well as sales of electric vehicles have also hastened predictions for peak demand for oil and gas.
Rystad Energy said last month it expected global oil demand to peak at 101.6 million barrels per day (bpd) in 2026, versus a forecast made in November for a peak in 2028 at 102.2 million bpd.
With an increasing share of energy being produced by solar and wind power, the global energy trade, dominated by the fossil fuels today, is going to shrink significantly, it predicts.
“We are going to de-globalize the energy market with the new technologies,” Rystad said at Thursday’s conference.


Bahrain’s Investcorp targets larger North American deals

Updated 06 May 2021

Bahrain’s Investcorp targets larger North American deals

  • Investcorp is the region's largest private equity and alternative asset manager
  • Investcorp plan to increase assets under management to $50 billion

RIYADH: Investcorp Holdings BSC is targeting larger private equity deals in North America as it seeks to boost assets under management to $50 billion, Bloomberg reported.

The biggest private equity and alternative asset manager in the Middle East sees buyouts in that region representing one of its best avenues to growth, David Tayeh, head of North America private equity, said in an interview.

The firm is also looking at more co-investments as a way of participating in bigger deals, he said.

“We want to grow our capacity to invest and broaden the top of the funnel of investments that we can look at from a size perspective,” said Tayeh. “At the moment there are deals that we really like that we don’t pursue because they’re outside our size range.”

Investcorp, which counts Abu Dhabi sovereign wealth fund Mubadala Development Co. as a major investor, outlined a plan to double its assets under management from about $25 billion in 2018 within seven years. It is targeting a combination of acquisitions and boosting its existing private equity, real estate and alternative investments units.

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Abu Dhabi National Hotels first quarter profit more than doubles

Updated 06 May 2021

Abu Dhabi National Hotels first quarter profit more than doubles

DUBAI: Abu Dhabi National Hotels Company reported a more than doubling of net profit year over year in the first quarter as its financing costs fell.
First-quarter net profit was 40.7 million dirhams ($11.1 million), up from 16 million dirhams in the year earlier period, ADNH said in a filing to the Abu Dhabi Securities Exchange.
Revenue fell to 224.7 million dirhams from 344.3 million dirhams, while costs dropped to 201.8 million dirhams from 294.1 million dirhams.
While financing costs fell to 9.5 million dirhams from 19 million dirhams, the big difference from a year ago was the 41.9 million dirhams settlement of a legal claim in Q1 2020 that was not repeated in 2021.
The legal claim related to construction of one of its hotels. The total settlement amount was 200 million dirhams against available accrual of 158 million dirhams, resulting in a loss of 42 million dirhams, ADNH said.
Profit from joint ventures, including ADNH Compass Middle East, was 44.3 million dirhams, up from 39.6 million dirhams a year earlier.
The company, which owns 12 hotels in the UAE, including two Radissons, a Sheraton, a Park Hyatt and a Ritz Carlton, ended the quarter with 89.5 million dirhams less cash or equivalents at 264.9 million dirhams.