🌾 Bakers, Beware + Corn's Wax-Wavelengths, Indoor Ag's Booster, and more...

Bakers, beware.

Flour prices are set to rise as extreme drought, market volatility, and skyrocketing input costs have the whole supply food chain passing costs down to consumers.

Perfect storm: Nearly 98% of the U.S. spring wheat crop is experiencing drought conditions—rated the worst since 1988. Commodity buyers are swapping increasingly expensive corn for wheat in livestock feed, and logistics costs are continuing to climb. That’s leaving mills big and small to compensate—meaning price increases are in the mixing bowl.

Bone dry: In the Pacific Northwest, production of winter white wheat wanted by Asian buyers for sponge cakes and noodles is withering. The drought is shrinking kernels and raising protein levels, rendering the once-premium product useless for anything but cattle feed.

The decline in quality wheat is already sifting out flour production, with second-quarter 2021 production down .6% from the pre-COVID second quarter of 2019.

And while we're here: For the first time, an apron-wearing rep is entering the battle over biofuels. Baked goods companies complain that blending mandates raise the costs of staple foods—like donuts.

Renewable Fuel Standard proponents say now isn’t the time to dial down biofuel backing, citing the ag industry’s continued rebound from trade wars, weather events, and COVID-19.

Quick Hits

→ The cattle transparency shuffle. After numerous industry calls for increased market information, the USDA will begin releasing price reports based on cattle sold on formulas, grids, and contracts.

→ Out of stock. Carbon Robotics has sold out of its 2021 inventory of their weeding robots, which combine AI and laser technology to zap weeds.

→ In more robot news… John Deere will acquire Bear Flag Robotics for $250M and continue building out the autonomous driving technology that fits existing machines.

→ Tyson isn’t messing around. After spending over $700M to combat the spread of COVID-19, Tyson Foods will become the first U.S. food company to require all employees to be vaccinated this fall.

→ CRI$PR tech. Dutch startup Hudson River Biotechnology raised a $5.9M Series A round to scale up their CRISPR-based genome editing in plants and focus on application of agrochemicals using their nanotech delivery platform.

→ EPA is (trying) to play nice. The agency is asking for farmer and rancher feedback as it plans to revert its Waters of the United States rules back to Obama-era standards, which previously caused an uproar from agriculture groups.

→ Drone usage soars. A recent DroneDeploy survey found that drone use in agriculture saw 27% more flights and 17% more users in Q2 of 2021 compared to year-ago levels.

→ A new nut in town. Global demand for chestnuts is expected to rise (2.2% over the next 5 years), and the U.S. wants in on the action. Only 1% of the global supply is grown here, but a new report details how to get more American farmers into the market.

Curtin University in Perth, Australia is lighting the way to improved crop protection.

The university and the Australian Nuclear Science and Technology Organization (ANSTO) are working on a new imaging tool that would help scientists monitor the development of fungal disease in plants.

Wax on: The lead researcher says the wax layer on a plant’s leaves gives off specific wavelengths of infrared light, which would help scientists understand how plants respond to infection by pathogens.

“We expect this discovery to reveal new information on the effect of disease on living plants, and the timeline through which diseases affect plant physiology, with implications not just for agriculture, but also to monitor environmental impacts such as pollution or climate change,” researcher Karina Khambatta said.

Path of least destruction: This research unveils big benefits for farmers and crop health, including:

Genetic gain for disease resistance through plant breeding
New methods for assessing crop health
Judicious use of fungicides or other input decisions
Cost savings for farmers

The more you know: If you’re feeling especially science-y, you can read the paper here.

Tech-enabled tomato farms, Growing Centers, and AI robotics systems - it's the indoor agriculture trifecta.

Sustainability-focused fund manager Equilibrium Capital recently invested $91M in AppHarvest, an indoor farming company. The goal? To build no less than 12 indoor farms by 2025. A construction loan for a tech-enabled indoor tomato farm in Richmond, Kentucky, is included in the deal.

A soundbite: Equilibrium CEO David Chen said his firm has “institutional expertise in controlled environmental agriculture, which makes AppHarvest a natural partner as they work to drive positive change in agriculture to ensure food security sustainably.”

This is after AppHarvest completed a reverse merger with Novus Capital and went public in February at a $1B+ valuation.

With the leadership kicker: AppHarvest also snagged former Amazon exec Mark Keller in July to join the team and build out the company's AI-powered harvesting robot, Virgo.

Speaking of indoor farming, German vertical ag startup Infarm is also expanding in Canada after strengthening its partnership with food retailer Sobeys. The company will build “Growing Centers” complete with multiple 25 square-meter modules—which can produce the equivalent of 10,000 square meters of farmland.

Oh, and this: Singapore-based Augmentus also raised seed funding for a “no-code” indoor farm robotics platform.