There have been significant advancements in technology in the agricultural sector that have played a substantial role in ensuring that the world’s population has access to the highest quality food grains, vegetables, and fruits all year long, with the best possible taste and nutrition. This is the reason why agri-tech startups and emerging companies receive funding in different parts of the world at exceptional valuations. Today, we are looking to throw some light on one such emerging, recently listed agri-tech player that is available at surprisingly low valuations and that could be an excellent investment opportunity for small cap investors – AgriFORCE Growing Systems Ltd. (NASDAQ: AGRI).
A Quick Recap of AgriFORCE
AgriFORCE is a pre-revenue AgTech firm that aims to transform different aspects of agriculture, from cultivation to manufacturing. Through its proprietary facility design and other agri-tech intellectual property (IP), its management is constantly looking to develop unique technologies that deliver innovative, trustworthy, and financially strong solutions for cultivating high-value crops. AgriFORCE intends to operate in plant-based foods and products, pharmaceutical, nutraceutical, and other high-value crop markets by utilizing their proprietary facility design, hydroponics-based automated growing system and fully integrated controls and procedures. The management believes that this will allow cultivators to grow crops more effectively in a controlled environment, resulting in higher yields. The company aims to use its technology to ensure that farmers can grow crops in virtually any climate location and optimize crop yields to reach their genetic potential while eliminating the need for herbicides, pesticides, and/or irradiation. AgriFORCE was established in 2017 and is headquartered in Vancouver, Canada.
Latest IP Acquisition From Manna Nutritional Group
AgriFORCE recently announced the signing of a material definitive agreement to acquire the intellectual property from Manna Nutritional Group LLC, a privately held firm based in Boise, Idaho. This intellectual property includes patent-pending technologies for naturally processing and converting grain, pulses, and root vegetables, resulting in low-starch, low-sugar, high-protein, fiber-rich baking flour products, and a by-product of a high-nutrition juice that can be used in a variety of applications. The core process is a pending patent application in the United States and key international markets. This all-natural process is intended to naturally unlock nutritional properties, flavor, and other qualities in a variety of modern, ancient, and heritage grains, pulses, and root vegetables. Focusing first on wheat, the largest opportunity as it represents 20% of the world’s daily intake of calories, the Manna Nutritional Group’s wheat flour contains over 40 times the amount of natural fibers, up to 3 times more proteins, and only 12% of the starch, as compared to standard all-purpose wheat baking flour, a staple of our everyday diet. AgriFORCE plans to develop a range of consumer branded premium flours, as well as a premium flour ingredient lineup to target wheat-based baked goods, breads, bakery, and dough categories aimed at the food service and manufacturers businesses.
The AgriFORCE management believes that this acquisition is the next step in their comprehensive strategy to use intellectual property to create more sustainable, natural, and high-quality food, medicine, and plant-based products. The company’s CEO, Ingo Mueller also stated that he believes that by capturing a small portion of the overall flour market with their own brand and through relationships as an ingredient supplier, this IP will provide an opportunity to transform the landscape of food production across a variety of categories. Manna’s proprietary process, built with tremendous effort over the past 6 years, is designed to provide the key ingredients for many of the foods that people want to eat, as well as the nutrition and flavor they seek could blend wonderfully with AgriFORCE’s offerings in support of providing consumers with healthier options.
AgriFORCE’s Continued Expansion and R&D
Over and above the Manna IP transaction, AgriFORCE is creating and acquiring intellectual property in order to improve the agricultural value chain. The management is streamlining the traditional farming method by incorporating modern technologies. The AgriFORCE precision growth method, which uses a unique combination of modern and traditional techniques to outperform traditional growing methods and increase yields, is a classic example of this. This revolutionary approach leverages cutting-edge technologies in the Internet of things (IoT) and artificial intelligence (AI). It assists farmers in developing a new green standard for crop cultivation as well as managing the production process for plant-based products. Furthermore, it contributes to addressing some of agriculture’s most pressing legacy issues, including environmental impact, operational efficiency, and yield volumes. Given the management’s efforts to build an optimized facility design, AI utilization, IoT, and nutrient delivery to help produce larger crops with fewer resources and a minimal impact on the environment, AgriFORCE’s methodology can be described as scientific, intricate, and success-oriented. The management began implementing its innovative technology in the rapidly rising hydroponic farming market, focusing on high-value crops that are notoriously difficult to cultivate. It has also been considering expanding its operations into other verticals like vegetable and fruit cultivation in order to increase the use of its intellectual property. AgriFORCE is also looking to use its IP base to cultivate plant-based vaccines. The management expects that the proprietary facility design and automated growing technology will position the company as a leader in the agricultural industry, allowing it to make much-needed agri-tech renovations.
There is little doubt that AgriFORCE is a bargain at the current valuations. The company’s public offering took place at $5 per share and the stock is currently trading at around $2.28. AgriFORCE expects to launch its first product, which will include several specialized baking flours, in 2022. The management believes that they have a transformative opportunity to generate over a billion-dollar business with all-natural products in the flours, bakery, and snack categories, along with dairy alternatives, nutrition and performance bars, high-performance drinks, and other categories. The company’s technology to optimize crop production looks to go leaps and bounds ahead of the recent agriculture industry standards. Overall, we would like to reiterate that the company could be an excellent agri-tech investment opportunity for small-cap investors.