AppHarvest says it’s inventing an industry ‘from scratch,’ but it’s unclear how the upstart will balance its promise to rural people with a move toward automation.
AppHarvest says it’s inventing an industry ‘from scratch,’ but it’s unclear how the upstart will balance its promise to rural people with a move toward automation.
April 6, 2022
A version of this article originally appeared in The Deep Dish, a members-only monthly newsletter from Civil Eats. To read the full issue, with exclusive reporting, interviews, photographs, and more, become a member today.
Nancy Hatfield was working the night shift as an assistant manager at a 24-hour Shell gas station in Flemingsburg, Kentucky, when she learned that the new indoor farm—just 20 minutes away in Morehead—was hiring.
Hatfield, who is 27 and has two young daughters, says before her eldest started school, the late hours weren’t so bad. Her husband would take care of the kids at night, and she would spend the day with them before heading back to her job at 5 p.m.
“It was great,” she told me. “Then Madeline started school, and I was like, ‘If I’m at work all night and she’s at school all day, I’m never going to see her.’ And that didn’t sit well with me, so I went on the hunt for a different job.”
Now, Hatfield spends evenings with her family and days helping take meticulous care of hundreds of thousands of tomato plants in a glass-roofed greenhouse the size of 50 football fields. She started working for AppHarvest—a company she says many in the community had their eyes on—shortly after it went into production in March 2021, right before the first harvest of hydroponic tomatoes.
Hatfield is one of around 500 AppHarvest employees from Morehead and other nearby towns in this region of Appalachian Kentucky, a small army of plant tenders called “crop care specialists” who show up every day in brightly colored T-shirts. The jobs—which start at $13 an hour and provide health insurance and productivity bonuses—have been popular in a region where the average household income is 40 percent less than the national average, and living-wage jobs have been scarce in recent years.
For Hatfield, it was a step up. “There hadn’t been anything similar in the Morehead area,” she told me. “A lot of people either work in fast food, education, or in the medical industry. So, this gives people an option in the agriculture field, without having a degree.”
Hatfield is also missing a hand, so her job options have been limited. And yet, when we spoke, she described with enthusiasm the way she one-handedly removes suckers from the tomato plants—which can grow as tall as 40 feet under a combination of natural light, LEDs, and high-pressure sodium lights—to ensure that the plants’ energy goes into creating trusses, or clusters of tomatoes. Hatfield hopes it leads to more opportunities with the company. But for now, she says, she likes caring for the plants much better than overseeing a convenience store.
The other AppHarvest workers I met at the Morehead facility—a sleek, 3 million-square-foot building made up of several conjoined Dutch-style greenhouses surrounded by picturesque rolling hills—echoed Hatfield’s experiences. And it’s not hard to see why the whole operation has inspired a combination of awe and optimism for both residents and visitors.
Inside the temperate greenhouse, long rows of plants—720,000 in total growing in small cakes of substrate—flank a center walkway, and the light, when it filters through the glass roof, is refracted, diffusing and softening the shadows. A 44 million-gallon retention pond lies alongside the far end of the building, collecting rainwater and cycling it through to the plants and back out again in a closed loop.
And while it’s one of a handful of high-tech indoor farming operations that have garnered glowing media attention and massive venture capital investments in recent years, the majority of the others have built locations in urban areas first and then begun to add more rural, less coastal locations. Take Aerofarms’ indoor warehouse operation in Danville, Virginia (population 42,000), or Bright Farms’ greenhouse in Wilmington, Ohio (population 12,000), for example.
AppHarvest, on the other hand, has been rooted to rural Kentucky from the start. CEO and founder Jonathan Webb grew up in the state and returned a few years ago after working in renewable energy development in New York and Washington, D.C., including a stint with the Department of Defense. He says he turned to the burgeoning world of indoor agriculture as a solution to climate change and an alternative to conventional farming, or what he calls “dirty agriculture.”
He points to three reasons he has chosen Appalachian region: As one of the wettest states in the U.S., it has abundant rainwater that the company hopes can make it resilient in the face of climate change; it’s located a day’s drive from nearly 70 percent of the U.S. population; and it’s a place where people are hungry for jobs.
When the tobacco and apparel industries left the region and coal shifted course to mountaintop removal, which requires much less human labor than traditional mining, a whole generation was left in the lurch. Some people picked up and left rural Kentucky, and many who stayed found work for remote call centers, meat processing facilities, and prisons.
Webb, who can talk at length about the region’s tenacity, describes Appalachian Kentucky as “a prime candidate to reshape labor practices in agriculture.”
And the company, which went public in February 2021 and has had a rocky start on the market, has big plans to expand. In 2018, it received its seed funding from the Rise of the Rest seed fund, the effort founded by AOL co-founder Steve Case and Hillbilly Elegy author-turned prospective-U.S. Senator J.D. Vance with the stated intention to bring more technology companies to rural areas. It has raised more than $500 million since then, thanks in part to Martha Stewart, who has been an early champion and board member.
Three new greenhouses are currently under construction, and the company plans to have a total of 12 by 2025, including two more on the land in Morehead. And while tomatoes are the sole product now, there are more on the way, including salad greens and strawberries.
AppHarvest is also part of a larger effort to attract more agtech businesses to the state—and that might be another thing that drew Webb to Kentucky: The state provides tax credits, bonds, and other financial support for incoming companies, and its leaders have taken a particular shine to the idea of agtech as a larger economic solution. (AppHarvest claims it hasn’t received any tax incentives to date.)
“There’s no way to get to a 2050 or 2075 world that does not include what we’re doing here. Hard stop.”
Governor Andrew Beshear has been so inspired by the promise he sees in AppHarvest, and the industry at large, that he has developed plans to make Kentucky “America’s agritech capital,” including a collaboration with the Dutch government and 16 other organizations, as well as an official advisory council.
“When Toyota Motor Company set up in Scott County in the mid-1980s, few could imagine the number of jobs and the economic activity, both directly and indirectly, that would flow from that one plant,” said Beshear when he toured AppHarvest’s Morehead facility in early 2021. “We see the same path for AppHarvest and others: investments that will grow over time into powerhouse economic engines for our state.”
Kentucky also boasts the “lowest electricity rates in the Eastern U.S.” as a selling point for those looking to build new agtech operations in the state. Of course, it’s also worth noting that almost 70 percent of the Kentucky’s electricity was generated by burning coal in 2020.
AppHarvest’s current iteration—which involves many human hands on each plant—isn’t permanent. And that’s key to the promise the company has made to investors; the cost of labor has to come down pretty radically in order to make a produce farm a smart investment—and that’s where automation enters the picture. Last April, the company acquired Root AI, a startup that uses artificial intelligence to create farming robots.
Is it possible to simultaneously boost the economy, provide good jobs, and move toward automation? And what do massive investments in indoor agriculture mean for independent farmers in the state’s burgeoning local food economy? Furthermore, what can AppHarvest illuminate about how the current wave of indoor farming operations stands to impact rural places?
These are the questions I set out to answer when I visited the farm in December.
When I spoke with Webb a few years ago, shortly before AppHarvest broke ground in Morehead, I was struck by his intense, verbose visioning.
Then in early December 2021, we sat around a fire pit in front of the large RV he lives in with his wife on the AppHarvest campus. It was early in the morning and the frost that had settled overnight was melting and turning to steam in the bright, late-autumn sunshine. The effect gave Webb—in a wool plaid button-down with his hair cropped at his shoulders—an almost oracle-like quality.
Webb effusively shared his philosophy—and the fact that he sees his company’s produce as displacing not the local farms in the area but the “dirty agriculture” grown on large, conventional operations in California and Mexico, and points to the fact that many farmworkers face demanding, inhospitable working conditions and have limited rights.
“In 2021, why do we have people bending over in the fields breaking their backs and using harsh chemicals? I mean, we should all be just ashamed. It’s deplorable,” he said. “If you work in agriculture, you should be glorified. So, building a model around that shouldn’t be that out there. Ultimately, if we want to make any progress on the environmental stuff, [treating workers well] has to be a core piece of it. [We provide] living wages, healthcare, everybody has stock in the company. You’re making an investment in a person who is ultimately going to help you in the long run.”
This ethos was evident in the testimony of the AppHarvest workers I was given access to. Take David White, a father of five in his 50s who works as a crop care specialist. “I’ve had just about every job,” he said. “I’ve been a forest firefighter, a heavy equipment operator, an EMS [emergency medical service] worker.” Just before he was hired at AppHarvest, White worked at a meat processing facility in Owingsville, Kentucky, where he made sausage for Hillshire Farms and other big brands. This job is a clear improvement, he said.
“I’ve always liked messing around with plants,” he said, adding that he learned a lot from his grandparents, who were gardeners. White was an early AppHarvest hire who had gone through two harvests by the time we spoke, and told me he had recommended the job to several other people who now work alongside him. “It’s a good place to be for people who want to work,” he said.
Elaine Manning, a woman who looked to be in her 50s and had spent her early years in the army before moving home to care for her ailing father, was more effusive about the job.
“Honestly, I would have been a janitor to get my foot in the door,” Manning said. She added that she supports “the mission Jonathan has for this company, and how he wants to be sustainable and take care of the world, and not have our dependence lie with Canada and Mexico.” After a year working as a crop care specialist, Manning moved into a supervisory role.
“I was raised on a farm, and I still live at the home place built by my grandfather. Dad was a tobacco farmer. This is entirely different than what I was raised with, but I think my dad would be proud,” she added.
Webb and the team at AppHarvest see controlled environment agriculture (CEA), or hydroponic indoor food production, as the only way to feed a world where climate change is ushering in one weather extreme after the next. In addition to providing a way to move away from relying on drought-prone California for water-intensive crops, the industry also sees this approach as a way to protect crops from things like heat waves and floods.
“Honestly, I would have been a janitor to get my foot in the door.”
“Our country is packaging up water in an area that doesn’t have it and shipping it to the East Coast, where we have tons of water. Structurally, it’s broken; it’ll collapse upon itself,” said Webb, who added, “There’s no way to get to a 2050 or 2075 world that does not include what we’re doing here. Hard stop.”
Of course, the question of energy use—and the resulting carbon footprint—is a big one when it comes to indoor agriculture, and it certainly complicates Webb’s insistence on CEA as a climate solution. While Dutch greenhouses do utilize sunlight very efficiently, reducing the footprint of greenhouses compared to some other forms of indoor farming, energy use has long raised big questions for critics of the industry.
In 2020, AppHarvest released a sustainability report estimating that its use of LEDs had helped it cut electricity consumption by 20 percent, but it’s not clear how its increased use of robotics will impact the overall picture. And although the company says it’s working on a long-term plan to buy renewable electricity, it’s still reliant on that low-cost coal-fired power.
The company told Civil Eats that each pound of tomatoes it produces results in 3.8 pounds of CO2 emissions, a number that appears to be much higher than most field-grown tomatoes. It also says it plans to see the number go down as productivity rises.
How to put that number in context? One estimate that 1.4 pounds of emissions are produced for every pound of tomatoes grown, but that likely includes both field grown and greenhouse grown tomatoes. Meanwhile, a recent study of both types of tomato production in Washington state found that, “the GHG footprint in [high-tech greenhouses] was 18 times that of the OF [open field] system.”
Josh Lessing, the founder of Root AI and AppHarvest’s chief technology officer, also points to climate as a central motivator for the work. “As we start looking at uncertainty, due to climate change and access to food, we can instead have a food utility that lives outside of major cities and has year-round production,” he said.
But it’s also about creating a much more predictable, controlled industry, said Lessing, who has worked in various roles related to indoor agtech and said he had partnered with several of the Dutch companies that pioneered the greenhouses.
The goal, he said, is guaranteed production year-round, and a system that allows “visibility into when that food is going to be available. We have that ability for a manufacturing plant, we know when we get cars, shampoo, razor blades. We should hold food to the same standard, because frankly, it’s more important,” said Lessing.
“We know full well that’s what transformed heavy industry and manufacturing—the ability to go online and order a good and have it show up at your house the next day,” added Lessing. “And we’re dedicated to standing that up for farming.”
AI robotics is one piece of that puzzle; a portion of the tomatoes in the Morehead greenhouse is already tended to by robotic harvesters. Soon, he said, the robots will use computer vision and deliver data-driven insights for the nearly 80 miles of crop rows.
Will that shift involve replacing people? Not the ones already on staff, said Lessing, since the technology will rely on humans to oversee and work with it. But as the company scales up significantly, the number of employees won’t scale at the same rate. It currently plans to hire another 500 people (the same number it relies on to run the Morehouse facility) to staff its next three farms.
“An important thing that we’re learning as an industry is that collaborative workflows—where people work with robots—create amazing efficiencies and productivity,” said Lessing. “Part of doing that, we’re starting to train up people on all of this technology, because besides the fact that it’s very needed and wanted, it also fulfills our commitment to the community, which is to deliver a lot of on-the-job training, and upskilling the workforce.”
Webb, for his part, stressed that people who work as technicians on robots will also likely command higher salaries than those working with the plants. “And because we’re starting an industry that doesn’t exist, it’s not like we’re displacing jobs,” he said.
But not everyone agrees with that both/and framing. And not everyone agrees a whole new industry is what’s needed to bring prosperity to Appalachian Kentucky.
A whole subset of very vocal organic farmers have responded to the rise of hydroponic farming—objecting to the fact that the practice doesn’t focus on building soil—and the larger trend toward industrial-scale operations. And while AppHarvest isn’t certified organic at this point, the certification doesn’t appear to be off the table for the company either. Webb clearly wants to be seen as complementing the work of small-scale, local farmers.
“If we can grow it outdoors, if we can do it year-round, by all means that is what we should be doing. We should be getting soil health back, we should be getting microbes back into the soil. But this is taking pressure off the open field,” he said.
Martin Richards, the executive director of Kentucky’s Community Farm Alliance (CFA), has watched AppHarvest’s entry into the local marketplace closely and has met with Webb several times.
He was initially supportive of the company and believed Webb when he said he didn’t want to compete with local farmers. But then the company signed a distribution deal with Mastronardi, the “largest producer and distributor of greenhouse-grown produce in North America.”
Now, the produce it grows ends up wherever Mastronardi wants to sell it, including an array of grocery stores in Eastern Kentucky, where the tomatoes (and soon greens and strawberries) may be the recipient of the Kentucky Proud label or available to low-income shoppers looking to double the value of their dollars by buying local through the Kentucky Double Dollars program. Martin said both opportunities are the product of years of work by CFA to develop a market for locally produced food after tobacco left the region.
“[In the 1990s], we started thinking, if not tobacco, what’s next?” he recalled. Then, in 1998, the attorneys general of 46 states sued the four largest cigarette manufacturers in the U.S. to cover Medicare costs related to smoking in the Master Settlement Agreement. Kentucky is on track to receive an estimated $2.5 billion over 25 years.
“At that time, CFA and a whole lot of other ag organizations rallied together and passed House Bill 611, which devoted half those funds into diversifying agriculture,” said Martin. “And suddenly, farmers and communities had the resources to start building a different kind of agriculture in Kentucky.”
It took time, but it worked. Appalachia has long been home to diversified agriculture, and permaculture and forest farming—of mushrooms, ramps, medicinal herbs, and ginseng—have both grown in popularity. In addition to growing vegetables in high tunnels, Martin said CFA members are investing in small-scale livestock operations, growing more fruit and berries, and tapping their trees for maple syrup.
In recent years, demand for local food has grown to the point where today it is greater than the production, adds Martin. Farmers in the region have been slow to adapt to the idea that they can produce food for local markets, but they’re catching on, he adds. And the pandemic sped the process along, as consumers in the state enabled the growth of all kinds of new markets and infrastructure.
“And then comes along a startup entity with hundreds of millions of dollars to put up a large-scale greenhouse,” Martin added.
AppHarvest is far from alone in benefitting from the larger push for local produce. In fact, nearly every indoor farming operation markets its products as local, despite the term originating with an ethos that was more focused on small-scale field production—and the farmers’ markets, CSAs, and farm stands where the food they grow is typically sold. But the waters have been muddied over the course of the last decade, as “local” has been used to imply everything from more nutritious to more sustainable to more American.
Ultimately, Martin said he’s concerned that AppHarvest’s local sales—and its wider approach—could impact the future of Kentucky farmers. “This is the country we live in; it’s based on capitalism. AppHarvest and the other [indoor farming] operations in Kentucky are perfectly free to do all this. If they can raise hundreds of millions of dollars from investors and satisfy them by a return on investment, that’s all fine and good. But it comes down to a question of scale. And who is this building wealth for?”
He’s worried by early signs that the company plans to compete for federal or state-level funding that he believes should go to diversified Kentucky farmers.
AppHarvest is also thinking about the future of Kentucky farmers—but in a very different way. In 2018, before it built its first greenhouse, the company announced its presence in the region by launching an AgTech feeder program based on container farms built in shipping containers that has since expanded to serve 12 high schools around the region. Last year, it partnered with the U.S. Department of Agriculture to build one of the farms.
The company’s hope is that educating kids in container farming will prepare them for promising careers in agtech.
“Schools need people, hospitals need people, businesses need people. It starts and ends with people. And if we continue to shed population like we have, we will continue to be in a spiral.”
“It’s an emerging industry. And it’s the supply chain that we could own upstream and downstream from that, that could result in more opportunities for Eastern Kentuckians,” said Colby Hall, executive director of at Shaping Our Appalachian Region (SOAR), a nonprofit that works to fill the economic gaps left by the decline in human labor in the coal industry.
This is key, says Hall, because after coal industry workers lost their livelihoods, many of them moved away. So while Kentucky’s urban and peri-urban counties are growing in population, the state’s Appalachian counties are shrinking—some by double digits in the 2020 census. “Schools need people, hospitals need people, businesses need people. It starts and ends with people. And if we continue to shed population like we have, we will continue to be in a spiral,” he added.
Appalachia is indeed a unique region. It has long seen a lower-than-average investment in education, and people there face ongoing challenges with substance use and mental health as well as a range of other stark public health issues. But reductive ideas about the people of Appalachia and the age-old narrative that all it needs is a large company to swoop in and save the day are deeply intertwined.
In his 2017 book, Ramp Hollow: The Ordeal of Appalachia, Steven Stoll, professor of history at Fordham University, writes about how the area was “locked into an enduring association with poverty and backwardness” in part as a strategy by the coal and lumber industries to plunder the land—much in the way the white settlers had first taken it from five tribal nations in the region: the Cherokee, Choctaw, Chickasaw, Seminole, and Creek.
“Aspersions of stupidity, backwardness, primitivism, and volatility coincided with the seizure of the environment. Inventing a race of people and depriving them of land not only required the force of law, it required a story,” writes Stoll in the book.
And while the isolation of people there—largely because of the mountainous geography—was a much-described characteristic, he writes, “industry had no problem finding what it wanted and removing it. Corporations lay track to thousands of hollows and pulled billions of dollars in lumber and coal from the region. . . . Still, those searching for the cause of poverty in Appalachia—throughout the 20th Century and even today—blame isolation.”
In today’s context, Stoll said in a recent phone interview, the question is whether companies like AppHarvest and Mastronardi (which announced in December that it is investing in expanding CEA operations in Central America) are approaching Appalachia like they do the developing world.
“People there compose this huge unemployed labor army,” said Stoll. “And they’re an opportunity for someone who wants to come in and pay them very little to make an enormous amount of money off of their labor, by attaching them to ever more powerful machines. The key to this is that it has to be deskilled. And I say that not because the people there are not capable of great things, but because it is one of the most undereducated places in the United States.”
“The region and its people have always been in this exploitative relationship, except when they completely controlled their own land and their own destiny and hunted and farmed,” Stoll said. “I’m not proposing a quick return to that. But there would be ways of addressing the poverty of the region in such a way that it gave land back to people and let them make choices about it. And I happen to know a lot of people there want that.”
Adam Hudson knows the possibilities of independent farming in Appalachia well. He’s the director of Refresh Appalachia, a program that provides on-the-job agricultural training for people who need a second chance or a secure vocation. The trainees in his program raise food in high tunnels and on small, diverse operations—and learn everything from how to start seeds to washing, packaging, and warehousing, and some go on to start their own operations.
Since the landscape doesn’t lend itself to wide swaths of flat land, commodity crops are less common. For that reason and others, Hudson said, “Appalachian farmers are overlooked by most of the country. And yet if you come here, there’s a lot going on—from the hillsides to the stream banks, there’s someone trying to grow something or produce something that they can turn around and sell to somebody.”
He’d like to see more resources for independent farmers, as the region emerges from an era dominated by coal.
“We’re trying to work out how to break a generational cycle of poverty. We don’t want to produce a crop at a low cost and then not pay the person who’s producing it anything, and then ship it out of the region,” he said. “It’s just the same thing as coal. It’s extraction. Except sometimes at even lower margins.”
“The problem,” said Hudson, “is that too many people will come into the region with solutions. But they’re not coming in and asking, ‘How can I help?’ Instead, it’s, ‘Here’s how I’m going to help.’” He’s intrigued by the idea of automation and agtech, but he wonders if it will ever be made accessible to independent farmers in the region. “Are we thinking about the small enterprise that’s at $50,000, and with a little bit of automation and capital could be at $100,000 a year?”
FCA’s Martin wonders whether AppHarvest may eventually pivot to provide the Dutch technology that would allow others to build greenhouse operations in Kentucky. So far there’s no sign that the company plans to work with independent farmers, but prefers a factory-like model with employees. And both Webb and Lessing mentioned wanting to scale the work globally.
To Martin, the core question is: What is farming? “For me, and other folks who have similar values, it’s about stewardship of land, air, water, and biodiversity,” he said.
And yet, that question may be nested inside so many others that pertain to the rise of indoor agriculture: Should we focus on producing food by any means necessary, as efficiently as possible—like cars, shampoo, or razor blades? Or is it just one more effort in an endless drive to extract capital for investors? And perhaps most importantly—should the future of farming be unrecognizable to the people who know its past?
June 30, 2022
Amid the climate crisis and unprecedented drought, we examine the industrial dairy industry’s impact on groundwater in the state, as well as on low-income residents, communities of color, and small-scale farms.
June 29, 2022