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Red Sea Farms, which is backed by investors from Saudi Arabia and the UAE, is expanding into the US through its new agriculture technology that tackles food security problems by helping countries to grow crops in areas with scarce water resources.
The Controlled Environment Agriculture Centre at the University of Arizona's College of Agriculture and Life Sciences will evaluate the company's latest technology with the aim of introducing it in the world’s largest economy, Red Sea Farms said on Monday.
“Many parts of the US are water-scarce with seasonal harsh climates, making it a challenge to grow fresh produce year-round,” said chief executive Ryan Lefers.
“However, the breakthrough technologies Red Sea Farms has created could help address the reliance on freshwater consumption in food production and improve food security.”
Red Sea Farms mainly uses seawater to cool greenhouses and irrigate crops, reducing freshwater and energy requirements by up to 10-fold, according to its website.
Established in 2018, it mainly grows organic tomatoes in environment-controlled farms at a number of locations in Saudi Arabia.
Last year, the company raised $16 million to expand its operations. Saudi Aramco's venture capital arm Wa’ed, the Saudi government-owned Future Investment Initiative, King Abdullah University of Science and Technology (Kaust) and UAE-based venture capital group Global Ventures participated in the funding round.
US-based AgriTech business AppHarvest and investment firm Bonaventure are also supporting the company.
“Red Sea Farms’ systems can be quickly and easily scaled in harsh environments, including the vast parts of the US that are water-scarce where conventional farming methods are either not possible or not cost-effective,” Red Sea Farms said.
The company is looking to sell its technology to growers around the world as food security gains importance amid supply chain disruptions caused by the coronavirus pandemic.
The initial study will integrate Red Sea Farms' environment technology with existing infrastructure at the University of Arizona for a "phase-one, year-long project so benefits can be fully assessed before further deployment", the company said.
Other governments in the region are also supporting companies developing AgriTech. In 2020, Abu Dhabi said it would offer more than Dh110m ($30m) in financial incentives to companies in the sector looking to set up operations in the emirate as part of its Dh50 billion Ghadan 21 accelerator initiative.
Separately on Monday, Wa’ed said it had increased its ticket size to 75m Saudi riyals ($20m) to focus on later-stage funding rounds and widen its local investment scope in five core sectors — sustainability, manufacturing, social, digital and industrial.
Last year Wa’ed increased its venture capital portfolio with eight new deals and four follow-on investments, reaching up to 34m riyals in total dedicated funds.
Wa’ed Ventures, the venture capital investment arm of Wa’ed, currently supports more than 37 companies, including Red Sea Farms, telehealth start-up Cura and FinTech company Lamaa.