Find out how AgTech company RedSea used a green loan from HSBC to pave the way forward for sustainable agriculture solutions.
Food insecurity is a global problem. In 2021, as many as 828 million people suffered hunger and an estimated 2.3 billion were moderately or severely food insecure, according to the World Health Organisation. Climate change is making things worse. Desertification, for example, claims 120,000 square kilometres — equivalent to half of the UK — of fertile land every year.
Feeding the world in the future will require agriculture to adapt to hotter and harsher environments.
Agricultural technology company RedSea is using an innovative approach to tackle that challenge head on. From its origins on Saudi Arabia’s western Red Sea coast, RedSea has developed a unique hot climate agriculture platform that uses up to 90% less freshwater and energy than traditional methods. The platform stands on three pillars: proprietary controlled environment agriculture technologies, resilient plant science and intelligent systems.
Whereas most greenhouses are designed to keep plants warm in northern climates, RedSea’s platform of technologies are designed to keep crops cool in hot climates. Intelligent management and efficient use of solar and water resources result in significant savings of energy and water. An example of this is a crop of cherry tomatoes grown using RedSea’s platform of technologies, which has a savings of as much as 300L of water per kg of tomatoes produced.
As part of the platform, the company has developed a nano-material for greenhouse roofs that lets in light but not heat, and is cultivating robust new varieties of tomato rootstocks that are capable of thriving in difficult hot and salty environments.
Empowering other growers
The company’s latest project is a world-leading showcase greenhouse built on 1 hectare of land in the UAE. The greenhouse will produce vine crops and berries using RedSea’s technologies, demonstrating to local farmers how they can benefit from the technology.
“The aim of RedSea is to feed the world sustainably. It is not enough for us to just build greenhouses and operate them ourselves. We have to get these technologies into the hands of other growers,” said Simon Bryant, Chief Financial Officer at RedSea. “This project will clearly demonstrate to them how our technologies can increase yields and reduce utility costs.”
HSBC is supporting construction of the project with a US $2.5 million green term loan.
“We are delighted to be supporting RedSea at this early stage in their commercial journey,” said Miles Thornhill, Head of Corporate Banking and Head of Business Banking for the United Arab Emirates at HSBC.
“Solving food insecurity will require innovative solutions and significant investments in agritech ventures globally. We believe sustainable finance has an important role to play in helping scale up technologies that will have a positive impact on our future.”
In addition to growing and selling its own produce under the Red Sea Farms brand, the company has started to supply its technologies to other growers in hot places around the world, including the Middle East, Southern Europe, the Southern US and Mexico. With global temperatures breaking records again this summer, solutions like these will only become more important in feeding the world’s growing population.