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UK agtech sector receives well-needed funding from government

Fifteen British agtech firms are to receive a share of an £18 million agtech investment fund, financed by the UK government and industry partners. But the sector needs more funding, according to industry insiders.

The UK government’s £12.1 million commitment to a dedicated agtech fund for British companies, announced earlier this week, came amid calls for increased investment into the sector from industry figures.

The government’s contribution attracted a further £5.7 million from industry partners as 15 agtech firms were lined up to receive the funding. But these types of initiatives, although a great start, need to go further, according to Roger Carline, managing director at East Malling Services, a business working on technology that will allow strawberries to grow without soil. It is also one of the investee companies.

“The initiative is extremely important and goes some way to support and address an imbalance, but the scheme doesn’t cover full economic costings, instead relying on others to provide capital for facilities and their own finance for delivery of innovation,” Carline told Agri Investor. “This means the industry probably isn’t investing sufficiently into research to drive the sector forward fast enough, when compared to other parts of the food sector,” he added.

EMS’ sector of horticulture is particularly affected, he added. “The UK’s horticultural sector, accounting for 40 percent of the total plant-based agricultural sector, is comprised predominantly of small and medium enterprises (SMEs) that are typically investing less than 5 percent in research – and frequently only 0.5 percent through the industry levy board, “ said Carline.

The scheme provides 3 tiers of grants: early stage, industrial research and late stage funding. Early stage recipients are eligible for a maximum of £500,000 covering up-to 75 percent of project costs for SMEs. Late stage funding recipients can access up to £1 million, with 35 percent of SME project costs covered. This leaves plenty of capacity for industry partners to provide funding, as well as project leaders utilising their own funds.

Morrisons Supermarkets is also receiving funding from the scheme, to develop a way of breeding lamb with more taste and less waste by scanning live animals.

“This grant will help us develop an Estimated Breeding Value that works in cross-breeding situations,” a company spokesperson told Agri Investor. “This will be far more useful for the vast majority of lamb breeders. Lamb producers will now be able to select the best rams knowing with confidence that it will produce the sort of lambs Morrisons will require.”