Developing Facility Agriculture Needs to Consider the Sustainability of Operations and Profitability

The most significant document in the agricultural field this year is likely the National Modern Facility Agriculture Plan 2020-2030, which is China’s first nationwide plan focusing on the development of facility agriculture. The document provides a detailed summary of the current development pattern, development level, and regional distribution of facility agriculture in China, identifies existing issues, and sets out a detailed development plan for Chinese facility agriculture over the next seven years. It mainly covers the upgrading of old facility agriculture infrastructures, the construction of new modern agricultural facilities around large and medium-sized cities, the development of Gobi and saline-alkali land-based facility agriculture, planning for facility livestock and aquaculture, and how to build seedling (seed) centers and agricultural product cold chain logistics facilities. The document also includes detailed planning on the number and scale of various types of facility agriculture and supporting facilities.

The reasons for introducing such a detailed facility agriculture plan are sixfold: first, it is required for building a modernized agricultural powerhouse; second, it is necessary to ensure the security of agricultural product supply; third, large-scale agricultural infrastructure construction can effectively boost the consumption of raw materials such as steel and cement; fourth, facility agriculture helps increase farmers’ income; fifth, the long-standing reality that China has more people and less land will not change. Most cultivable land has already been developed, and the potential for further land expansion through natural reclamation is limited. Developing soil-less facility cultivation effectively increases the usable land area. According to the plan, utilizing Gobi and saline-alkali land can add one million mu of arable land. Sixth, during the COVID-19 pandemic, the shortcomings of food supply in large and medium-sized cities were exposed and need to be addressed urgently.

According to the plan, the future technological trend of facility agriculture is to achieve full control of the environment as much as possible while reducing energy, water, and electricity consumption. At the same time, it will significantly increase the application of information technology and intelligent equipment in facility agriculture.

Another trend is to develop facility agriculture mainly on a scale of over 100 mu, as only with scale can there be efficiency and an even distribution of equipment investment costs.

In the future, facility agriculture enterprises that adopt new technologies and equipment to improve park management levels and use modern enterprise management practices for personnel management will gain a competitive advantage in the construction of modern agricultural parks.

The construction of modern facility agriculture parks mainly involves four elements. First, natural foundations, such as roads, ditches, bridges, water sources, and flood resistance. Second, greenhouse construction, which varies based on the region and type of planting park and needs to consider cost, energy consumption, heat preservation, mechanization, and service life. Third, supporting equipment such as sowing, seedling, cooling, ventilation, and water and fertilizer irrigation systems. Fourth, information technology and intelligent equipment, such as environmental monitoring and intelligent transportation. The investment required for each of these four elements is a considerable expense for an independent financial enterprise.

From a long-term operational perspective, corporate investment in constructing facility agriculture parks is the simplest part of the entire park lifecycle. The long-term operation and sustained profitability post-construction are more critical and challenging issues. It is not easy for facility agriculture enterprises to achieve sustainable profitability: first, the current one-time investment in facility agriculture is too high; second, after the facilities are built, there is a lack of crop cultivation management experience, leading to limited output and even an inability to achieve year-round production; third, park operation costs remain high, particularly the energy consumption issue, which is the biggest cost constraint for the development of agricultural parks. Comprehensive considerations such as the utilization of new energy sources and energy storage are needed to reduce costs.