This article appeared in Issue 782 (June 5) of The Edge Singapore
SINGAPORE (June 5): Grey-haired and sun-scorched, William Ho is running out of time. Before his lease ends in two years, the quail egg farmer will have to secure funding and find suitable technology to bid for a new plot of agricultural land, as the country makes an unequivocal push for high-tech farming.
Ho is no stranger to agricultural technology. Lian Wah Hang, the farm his father built, had some of the most advanced farming machinery in the 1960s. At the peak of its profitability in 1997, the farm was earning $5,000 a day. But a series of unfortunate events — two relocations in 10 years, bird flu and SARS — as well as competition from cheaper Malaysian imports have made it a shadow of its former self.
Now, Ho is preparing to adopt technologies that are being used in major chicken egg farms in Singapore — from auto-feeders to shed-cleaning robots. “I’ll fight as long as I can,” he says.
His story is a reflection of the shifting agricultural industry, which until recently was considered of limited national importance. Farmland makes up less than 1% of the total land area in Singapore and accounted for 0.04% of GDP in 2015, down from 0.5% in 2010.
Yet, developments in agtech stand to alter those statistics in time. Last month, the government said it would release 60ha of land in Lim Chu Kang and Sungei Tengah to boost local supply. The new land parcels will have 20-year leases, instead of the 10-year leases that were offered in previous exercises, and will be up for tender starting in August this year. Importantly, winning bidders will be farming with new methods. The government has placed emphasis on productivity gains and business viability.
“We envision that farms of the future will be highly productive, and operate on minimal manpower by making use of better technology, including automation and robotics. Some of our farms may even move indoors or go high rise,” says Melvin Chow, group director of the Agri-Food & Veterinary Authority of Singapore’s food supply resilience group. “We will continue to support farmers’ efforts through capability building and technical support, R&D collaborations and technology transfer. We urge farmers to tap into AVA’s $63 million agriculture productivity fund to modernise and invest in innovative technologies and advanced farming systems.”
Not everyone is pleased with this new direction. Sixty-two farm leases will expire by 2021, and some farmers intend to exit the industry when their time is up. They say the new plots are sitting on reclaimed land, which is not ideal for soil-based agriculture. Others say the new model lacks flexibility. “The government needs to understand farms are not only about productivity. They are integral for education, tourism and community,” says Ivy Singh, owner of Bollywood Veggies.
Chow of AVA says: “As farmland is limited, it must be predominantly used for agricultural production. However, to provide some flexibility, farmers in new farmlands are allowed to develop visitor amenities such as cafés and farm education centres if they are kept within 10% of the land area and are subject to planning approval.”
It is the farmers investing in technology who are most enthusiastic. Among them is vertical fish farm Apollo Aquaculture Group. CEO Eric Ng intends to invest $40 million into his business and may even bid for more than one plot of land. “We plan to grow by 10 times our current capacity to reach 5,000 tonnes of fish annually within five years. We will build a six-storey vertical fish farm, from our present three-storey [farm],” he tells The Edge Singapore. He believes that the additional capacity will allow the company to compete effectively on price with imported fish.
Metro Farm, which runs remotely- controlled aquaponics systems, plans to double its current capacity with less than $1 million in investment. Hay Dairies, which produces goat’s milk, is setting aside $8 million to build a multi-storey goat farm that will raise its capacity by 40%.
A portable future
Around the world, farmers are being forced rapidly into modernisation in order to feed soaring populations while combating the effects of less climate change and pollution. As the right agtech becomes available, opportunities are being created for the entrepreneurial farmer here.
“This is the start of a farming revolution led by second- and third-generation farmers,” says Matthew Tan, associate professor at the school of chemical and bioengineering at Nanyang Technological University. He estimates that the yields of modern farms can be five to six times those of traditional farms. “Singapore’s farmers should team up with civil engineers and universities to create high-productivity modern farms. Once we have some model farms, others will follow and the industry will grow.”
It will, however, be important for farmers to invest in the right technology. “They should invest in production- centric technology and not infrastructure-centric technology. Production-centric tech is portable, reusable and can be reassembled,” says Tan. This means farmers will not have to deal with very high expenditures if [the farms] have to be relocated. Portable technologies also require less labour and allow farms to scale up faster.
Apollo’s multi-storey fish farm is one example of such a system. It is modular and produces 200kg of fish per tonne of water — more than twice that of traditional farms. Apollo’s key piece of technology is the Aquadeck, a recirculation aquaculture system that Ng built from scratch. It maintains the water quality in high-density fish tanks. Ng also uses real-time data to calculate the changing biomass of his livestock. “As the biomass changes almost every day, the data is crucial to help us adjust the feeding ratio,” he says. The system is so precise that Apollo currently supplies its technology to German aquaculture companies.
Another local player tinkering with portable technology is Sky Greens, which has developed a carousel-like structure for vertical farms. Plants sit in boxes that are placed in a stucture that resembles a Ferris Wheel and are rotated upwards so they get adequate water and sunlight. Sky Greens’ technology is powered by a hydraulic system to save on electricity costs. Sky Greens founder, Jack Ng, says his system can help traditional farmers cut labour costs by 75%, input materials by 75% and water use by 95%. Yields are also five to 10 times more than traditional farms.
So far, Jack says, some local farmers are not keen on buying his technology. And as an engineer and inventor, he is not interested to bid for land himself. Instead, he hopes to find farmers he can partner with. “They do not have assets. So the technology [they buy from us] becomes an asset to them,” he says. “We may help them with investment costs in exchange for a small amount of equity.” He estimates that the technology should pay for itself after four years.
Improving food security
As Singapore farms modernise, could the country eventually produce substantially more of its own food? At present, local farms supply less than 10% of food consumed here. The government has diversified import sources from 160 countries in 2007 to 170 countries now, but food security remains an issue. “We’re not robust in terms of food security; we’re very vulnerable,” says Paul Teng, an adjunct senior fellow at the S Rajaratnam School of International Studies.
With the push for high-tech farms and a $63 million agriculture productivity fund, AVA clearly hopes this will change. The authorities aim for local farms to produce 30% of Singapore’s supply of eggs, 15% of fish and 10% of leafy vegetables. Currently, only the target for leafy vegetables has been met.
“With high-tech farms, we can reach basic sustainability, maybe up to a month [without external supply],” says NTU’s Tan, who is also the chief technology officer of Oceanus Group. But Singapore also needs to think about how it can better utilise its land, Tan says. For instance, he estimates that utilising 10% of the total HDB flats’ rooftop area would yield 1.2 million kilograms of vegetables a year.
Already, a company called Citizen Farm is growing an assortment of vegetables, mushrooms and herbs in an urban farm in the middle of Queenstown. Its plants are grown in anything from containers to makeshift set-ups of pipes and sticks. The 5,000 sq ft space can yield up to 100kg of produce a day, which is supplied to 30 local restaurants. Founder Darren Ho says the farm has begun converting food waste into nutrients by using earthworms and black soldier flies. “Inputs are very expensive in Singapore, and this is one way we can be sustainable,” he says. Citizen Farm is also building a farming space under the West Coast Viaduct.
Rocky road ahead
While high-tech farms seem attractive, weighing heavily on some farmers’ minds is the fear that they may never recoup their investments if technology fails them. According to NTU’s Tan, teething issues with new technology can last up to six years. Maintenance costs can also be high, and there is always a risk of obsolescence.
Government grants can only go so far to help these farmers. And the agtech venture capital and private investment scene is severely underdeveloped in this region as investors are not yet familiar with the industry, says ID Capital CEO Isabelle Decitre. ID Capital recently hosted the Future Food Asia Award to showcase Asia-Pacific start-ups in agtech and foodtech.
Hugh Tan, associate professor at the National University of Singapore’s department of biological sciences, suggests farmers try to develop the right technology locally. “It would be best for farms and tertiary institutions [and local businesses] to collaborate to develop the technology. Some research projects have already been done this way,” he says. Metro Farm, for instance, developed its aquaponics system in collaboration with local small and medium-sized enterprises. Each system costs $60,000.
To improve their margins, farms also need to consider adopting technologies that allow them to move down the value chain easily. Hay Dairies is eyeing machines that produce yoghurt and ice cream. “After the cost is spread out, margins can widen by 10% to 15%,” says founder John Hay. Apollo wants to start producing fish fillets and marinated fish, which fetch a better price than ordinary fish.
Ho, meanwhile, is raising up to $4 million to bid for new land. On his new farm, he hopes to combine traditional farming techniques and modern technologies. He also wants to set up facilities to make salted eggs and century eggs, which sell for twice the price of regular eggs.
He knows he has a long way to go from his current semi-manual farm. “I am very late to the game”, he says, “but I have the know-how as a farmer.”