The 2011 Purdue Crop Cost & Return Guide recently projected that farmers could, once again, be seeing increased costs including rising prices in fertilizer, seed, fuel and pesticides, amongst other things that are not directly related to labor or land rental. In fact, the Guide has estimated that these variable costs could see double digit increases in the next year. As a result, food costs are anticipated to rise in 2011 as well.
Valcent Products, Inc. (OTCBB:VCTZF) has developed a solution to the ever-increasing costs related to farming and the subsequent rise in food pricing with its VertiCrop™ high density vertical growth system. The system, which grows plants in a suspended tray system moving on an overhead conveyor system, was developed over several years by Valcent and Valcent (EU) and is designed to grow vegetables and other foods much more efficiently and with greater food value than in agricultural field conditions.
Cutting-edge technologies, maximum sunlight and exact levels of nutrients are provided to each plant while eliminating the need for pesticides or herbicides through the use of ultraviolet light and filter systems. Water levels and balancing of pH as well as proper temperatures are maintained through a sophisticated control system that optimizes growth.
The VertiCrop™ system has many advantages over traditional farming with notable benefits in the volume of production, as the system has proven to produce approximately 20 times more than field crops and can work in virtually any environment.
Lands that have been deemed useless can be used at many levels as the system is completely scalable and can be constructed on non-arable lands due to the fact that it only requires 5% of normal water requirements for plant growth in fields. In a number of health and environmental capacities, the system is superior as no herbicides or pesticides are needed.
Combined, these factors add up to savings as a result of more efficient agriculture and drastic reduction in transportations and farming costs, without mentioning a higher quality and fresher food upon delivery.
Today, Valcent took a major step in strengthening its executive team with the addition of proven leaders that were integral components of Lululemon Athletic, Inc. (NASDAQ:LULU) who now head up institute B Development Corporation. Through a new agreement, ex-Lululemon general manager Darrell Kopke and his team at institute B will now work to commercialize Valcent’s technology worldwide.
Former Lululemon executives that now are part of the institute B Development Corp. include (former LULU positions in parenthesis). Darrell Kopke (GM and Managing Director Asia), Christopher Ng (chief supply chain officer), Manfred Vollmer (Director of Store Development), Bix Bickson (cultural development consultant), and Noel Fox (creative director of Cowie + Fox, Lululemon's marketing agency). Each is a veteran in growing young companies into global, high-performing brands.
The new agreement has not only strengthened the potential of Valcent and VertiCrop, but also has reaped immediate rewards regarding investor confidence. In part of a debt for equity swap to solidify finances, certain current debt holders have agreed to convert their debt to equity at $0.15 per share with a half warrant now that institute B is on board. This significantly reduces the current debt of Valcent and is an expression of confidence on the new management group's previous track record in international marketing.
Coming off of 52-week lows that saw that price per share touch a nickel, VCTZF has seen a solid climb in the last month which has brought the share price back over $0.15 each. With the signing of this new agreement and some negotiated financing, investors appear to be taking notice of Valcent and the opportunity it presents both now and in the future.
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