20 Feb 2012

Profitable urban agriculture?

This story prompted me to write this to the Economist:
I regret to inform you that Sweet Water Organics has a photogenic, but unprofitable, operation. I visited their Milwaukee site in September last year when I was speaking at a conference devoted to leveraging Milwaukee's freshwater resources into continuing economic growth. Although SWO has captured the heart of politicians and pundits, it is a heavily-subsidized operation that has not been able to compete on a sustainable basis with traditional "dirt" farmers. SWO does not suffer from overregulation or subsidized competition; it suffers from using too many gee-whiz technologies in a market where consumer purchases are decided on a penny-per-pound basis. If you're looking for reasons for business success or failure in the US, then I suggest you spend (even more) time on the dead hand of government regulations that destroy innovation and profitability across multiple industries and the rent-seeking that changes tax revenues into extraordinary profits for industries with effective lobbyists.
Bottom Line: Urban agriculture needs to be price competitive, not a political plaything.