Controlled Environment Agriculture

Marketing

Business planning tools for CEA

In 2016 and 2017 the Cornell Controlled Environment Agriculture (CEA) group and colleagues in the Dyson School and the Cornell Institute for Food Systems conducted studies and developed materials on CEA business and marketing with support from the U.S. Department of Agricultural Marketing Service.

CEA Background
By Neil Mattson



Interactive Spreadsheets for Greenhouse Lettuce and Tomato Production
By Irin Nishi, Miguel Gomez, and Neil Mattson



Consumer Willingness to Pay for CEA
By Irin Nishi, Miguel Gomez, and Neil Mattson

A consumer willingness to pay study was conducted with more than 200 subjects to determine interest and potential price differentiation for greenhouse vs. field and in-state vs. out-of-state lettuce and tomatoes. According to the study, New York State consumers are willing to pay 30% price premiums for New York State grown tomatoes and an 18% price premium for New York State grown lettuce. No price differentiation was found between greenhouse vs. field grown suggesting consumers care more about produce origin than production system.



Insights from NYS Produce Buyers
By Julie Stafford

Interviews were conducted to identify the needs of a NYS commercial produce buyers. The results provide insight regarding products of interest as well as considerations that local CEA growers should be aware when marketing to different channels.

This project was supported by the U.S. Department of Agricultural Marketing Service through grant 15SCBGPNY0023. The grant was administered and supported by the New York Farm Viability Institute (NYFVI) and the NYS Department of Agriculture and Markets. Project contents are solely the responsibility of the authors and do not necessarily represent the official view of USDA, NYFVI or the State of New York.


Insights into the economic viability of a new CEA system producing hydroponic lettuce

By Gunes Ilaslan, Gerald B. White, & Robert W. Langhans

In the Spring of 2003, a Cornell Agriculture Economics student, along with a professor from Ag Economics and Horticulture wrote a 'white paper' called: Insights into the economic viability of a new CEA system producing hydroponic lettuce. It looked at the production of Boston (aka buttercrunch lettuce) in nine locations throughout the country including:Chicago, Denver, Ithaca, Los Angeles, Miami, Phoenix, Raleigh, Seattle, and St. Louis

Abstract

A new CEA (Controlled Environment Agriculture) system growing Boston
lettuce, Lactuca Sativa cv. 'Vivaldi', achieves the same quality and quantity of production
every day of the year. The year-round constant quantity and quality production indicate
potential for success. However, our research showed that out of nine selected U.S.
locations with different climatic and economic conditions, the Northeast had 25.7 percent
higher production costs for the same yield.

The analysis indicated that given current prices and costs, CEA hydroponic
lettuce production in northern climates such as Ithaca in upstate New York and Chicago
is marginal to negative in terms of economic viability. As a result, the question arises
about the future viability of CEA in areas such as upstate New York and New England
where electricity costs are high and the climate is relatively cold. Many such areas are
struggling with the future viability of agriculture. Thus, this study provides alternative
ways to increase the economic viability of this new technology in the Northeast. The
importance of local production, state level promotion programs and other potential
incentives, and metro farm alternatives are examined. The analysis is applicable to other
agricultural products produced in the Northeast at higher cost than in other locations in
the southern and western United States.

Download Insights into the economic viability of a new CEA system producing hydroponic lettuce(pdf)