Investment in the Industry
Protected cropping structures are capital intensive, with a high level of supporting infrastructure required. For the high technology production facilities, there is a strong reliance on expertise from northern Europe, and north America. This also applies to much of the research and development that occurs in the engineering and technology areas.
Because the leading edge of the protected cropping industry is technology-driven, there will always be new developments that will have a positive impact upon production efficiency.
The key advantage of protected cropping is the ability to control the growing environment. This brings with it the ability to optimise climate conditions and plant properties to deliver improved productivity and profitability. For example, in the Netherlands over the last 25 years productivity (kg per m2 of glasshouse) has increased by 90% for sweet peppers and 35% for cucumbers.
Capital costs can be anywhere between $250 and $750 plus per square metre, depending on the sophistication of the facility and the level of equipment being included. Viable production units are a minimum of 1,500 square metres.
The average return on investment is between 5% and 10%. The potential return on investment for high technology glasshouse vegetable enterprises can be as high as 20-25% per annum.