New Jersey-based vertical farm operator, AeroFarms, has signed a joint venture agreement with Saudi Arabia’s Public Investment Fund (PIF) to establish operations in Riyadh and build and operate indoor vertical farms in Saudi and the wider Middle East and North Africa (MENA) regions.

The JV plans to build its first vertical farm in Saudi Arabia with several other farms across the region in the coming years. The Saudi farm is slated to be the largest of its kind in the MENA region, with an annual agricultural crop production capacity of up to 1.1 million kilograms.

The agreement aligns with PIF’s strategy of overall growth and diversification of the Saudi economy while enabling the capabilities of key sectors. It will also enable the optimization of natural resource utilization.

Analyst QuickTake: In locations such as Saudi Arabia and MENA regions, where water is a scarce resource, the development of vertical farms is a prudent and sensible solution. Vertical farms require less land area; hence, result in higher yield while using almost 95% less water in production, allowing the countries to utilize their valuable resources elsewhere. With AeroFarms already working towards establishing its presence in the Middle East (Abu Dhabi, Qatar ), this joint venture is likely to benefit both the host country's economy, as well as the company’s bottom line.