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Ramel Bradley is teaching high schoolers for AppHarvest. But is the company viable?

AppHarvest launches agriculture program at Eastern Kentucky high school

Students hope AppHarvest’s new class at Shelby Valley High School will prepare them for work in the high-tech agriculture industry. Former UK basketball player Ramel Bradley is leading the class.
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Students hope AppHarvest’s new class at Shelby Valley High School will prepare them for work in the high-tech agriculture industry. Former UK basketball player Ramel Bradley is leading the class.

Shelby Valley High School sophomore Olivia Thornsbury stood shoulder-to-shoulder with about a dozen of her classmates in AppHarvest’s newly-constructed hydroponic growing facility outside her Pike County high school.

The facility resembles a shipping container from the outside, but the inside is outfitted with water lines, hi-tech lighting and control panels. Lettuce plants grow on columns that line the walls of the container, and AppHarvest hopes students will eventually make the space their own experimental indoor garden.

Company and high school officials kicked off the project this week. They hope to train students for work in high-tech agriculture companies like AppHarvest, which has proposed bringing hundreds of jobs to a 60-acre greenhouse near Morehead.

About 30 students will work on the project this semester. It has sprouted hope among some students that the company will bring industry and jobs to a region hit hard by the collapse of the coal industry, where few employment options await them after graduation.

“Any options are good options,” Thornsbury said.

She and other students said they are hopeful the project will train them for future careers in this industry, though AppHarvest has yet to construct any facilities in Eastern Kentucky.

“We haven’t had anything around here in forever. The last thing we had was coal,” sophomore Noah Collins said. “This could be just as good.”

AppHarvest announced years ago that it would build one of the world’s largest greenhouses near Pikeville on an abandoned coal mine and industrial site owned by the city.

After nearly two years of delays, the city rescinded the company’s lease, but now AppHarvest has its sights set on Morehead, where the land, they say, is more suitable for building.

Shelby Valley Principal Greg Napier said he thinks partnering with AppHarvest will give students the chance to pursue career opportunities they might not have otherwise considered.

The project garnered a lot of interest, he said. About 80 students applied for about 30 available seats in the course.

“We’re looking for anything that can keep our kids here at home and let them pursue a career they’re interested in,” Napier said.

Former University of Kentucky starting point guard Ramel Bradley will teach the class. He’s AppHarvest’s community director.

Bradley said he has no formal experience in agriculture, but he moved to Eastern Kentucky to teach the course for the next couple of months.

“Not everything’s gonna go perfect, and that’s fine,” Bradley said.

He hopes he and the students will learn together, but that they’ll eventually take the lead and make the space their own.

“It’s really inspiring for me to see the interest that these students have,” Bradley said.

Is it viable?

AppHarvest’s promise of nearly 300 jobs near Morehead, and its mission to make Eastern Kentucky the “high-tech greenhouse capital of the U.S.,” has fostered some concerns among people involved with ongoing agricultural projects in the region.

They worry that, if the project does not come to fruition, the lost promise of new industry could hurt locals who got their hopes up, and that, if the project does get off the ground, AppHarvest may end up competing with local farmers.

Alison Davis, a professor of agricultural economics at UK and executive director of the Community and Economic Development Initiative of Kentucky, said she applauds projects that aim to bring jobs to the region, but “it’s going to be tricky.”

AppHarvest Morehead.jpg
AppHarvest, the hi-tech greenhouse project originally planned for Pikeville, now plans to relocate to this agricultural site near Morehead. Will Wright wwright@herald-leader.com

AppHarvest’s plan to sell tomatoes to metropolitan centers within a day’s drive of Morehead means they’ll be competing against Mexican importers who produce consistently tasty tomatoes at a low cost.

In 2005, the U.S. imported just over $1 billion of tomatoes from Mexico. Now, the country imports more than $2.5 billion, according to the U.S. Department of Agriculture.

The percentage of foreign produce that Americans consume compared to domestic produce has also spiked. Since 1980, when less than 10 percent of fruits and vegetables came from abroad, the rate has jumped to about 30 percent, according to a USDA report.

“For now, this is a market that has been dictated largely by Mexico, and that has created a really competitive market,” Davis said. “It’s going to be challenging for (AppHarvest) to compete in this particular market.”

According to the company’s website, AppHarvest expects to keep its prices competitive because of its proximity to major population centers, and because its greenhouse will use less water than its competitors.

“Because we use less water and ship our produce shorter distances, we are able to maintain conventional pricing,” the website reads. “Growing indoors removes weather and seasonal constraints, empowering agricultural sustainability and resiliency locally.”

AppHarvest’s Morehead location is expected to bring nearly 300 jobs at its 60-acre greenhouse. The company’s minimum wage would be $13 an hour, according to CEO Jonathan Webb.

Local and state officials have applauded the company for its efforts, and the state has promised tax incentives if AppHarvest can get its greenhouse off the ground.

A spokesman for the investment group Rise of the Rest Seed Fund, with its leadership including “Hillbilly Elegy” author J.D. Vance, confirmed that the group invested in AppHarvest in 2018, but did not disclose the size of the investment.

The company is “excited to continue to work with them to bring sustainable agriculture to Eastern Kentucky,” the spokesman said.

AppHarvest expects to spend about $85 million building and equipping its Morehead location, said Webb.

The company has financing “standing on the sideline, ready to go,” he said.

Davis, though, said she has her doubts.

“We’ve had a lot of these projects announced, and they’ve had a hard time finding financing,” Davis said. “I get concerned about these promises that might not get fulfilled.”

‘Don’t just do things to us’

Lora Smith, fund adviser for the Appalachian Impact Fund, an investment fund that focuses on locally-driven economic development projects in Eastern Kentucky, said she’s also concerned that AppHarvest’s promises aren’t realistic.

Smith said she wished venture capital funds, such as Rise of the Rest, would do more legwork to learn about ongoing projects already having an impact in Eastern Kentucky, rather than backing more highly-publicized, but less concrete projects like AppHarvest.

AppHarvestWebsite
A screenshot of the AppHarvest.co website. AppHarvest.co

“What I’d say to outside impact investors is to please bring new resources to the region, but work with us and don’t just do things to us or throw money at flashy ideas,” Smith said. “In the long game, investing in companies coming into the region to help ‘save’ us won’t produce the sustainable outcomes investing in local people will.”

The Appalachian Impact Fund helps support a number of initiatives that Smith said have already had impact on the ground, and at a lower cost than large ventures like AppHarvest.

Valerie Horn is the market co-chair of the Letcher County Farmer’s Market in Whitesburg, and helped organize a community kitchen that recently opened in the city.

Those projects have received some funding from organizations, including the Appalachian Impact Fund, but Horn said the relatively small investments have had big impacts on the health of local residents.

Local farmers, too, have been able to expand their businesses because of the farmers’ market, Horn said.

Sales at the market jumped from about $6,000 in 2013 to about $120,000 last year.

“A small amount of investment in a community can have a huge impact on that community when it goes directly to the farms, the farmers and groups that are working with them,” Horn said.

Horn said she doesn’t want the region to miss out on a large-scale opportunity like AppHarvest, but asked government officials and investors to “not underestimate the impact that small farmers and farmers’ markets can have on a community.”

Martin Richards, executive director of Community Farm Alliance, a group that aims to create policy initiatives that benefit local farmers, said he worries that if AppHarvest cannot market its product to metropolitan centers, the company will aim to sell produce in Kentucky and compete with local farmers.

“That’s a problem if that’s what happens,” Richards said. “I wish anybody willing to take the risk good luck with it, but when public dollars are involved, that’s when everybody has to ask the hard questions.”

Will Wright is a corps member with Report for America, a national service program made possible in rural Appalachia with support from the Galloway Family Foundation. Reach him at (859) 270-9760, @HLWright

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