Veggies harder to sell than a Rolls-Royce: GroGrace co-founder on the struggles of farming in S’pore
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GroGrace co-founder Grace Lim, pictured at her farm, had announced on its social media platforms that it would fold on Feb 14, but later extended the deadline till the end of February to explore potential partnerships to keep the business afloat.
ST PHOTO: NG SOR LUAN
Letitia Chen and Shabana Begum
SINGAPORE – Vertical farm GroGrace faces imminent closure, but its co-founder Grace Lim is still seeking lifelines to keep it from joining a growing list of shuttered indoor farms here
GroGrace, which is operated by Urban Farming Partners Singapore, announced on its social media platforms on Feb 8 that it would fold on Feb 14.
But Ms Lim, 52, told The Straits Times she is extending the deadline till the end of the month as she explores potential partnerships with other farms and investors that could keep the business afloat. She declined to reveal the entities that she is in talks with.
As the company has been defaulting on rent and utility payments, Ms Lim said she was forced to confront the fact that it might be time to let her company go.
She said: “I don’t have much more time. So if nothing materialises in the next few days, then we have to close, unless miracles happen, or money comes in from somewhere.”
Ms Lim was speaking to ST on Feb 24 at the farm’s Jurong premises, opening up in a rare interview on a farm owner’s challenges navigating the local agricultural scene. Her farm occupies space within an industrial building.
Many vegetable farms, including I.F.F.I and Growy
Previous closures of farms were discovered through liquidation notices, and the farms’ founders did not respond to requests for comment.
Agri-tech experts and consultants have attributed the closures to high capital and energy costs
In November 2025, the Government announced that it would be dropping local food production targets
Previously, the country aimed to produce 30 per cent of the country’s nutritional needs by 2030. In 2024, locally produced vegetables accounted for 3 per cent of the nation’s total food consumption.
One of the new targets is for Singapore to produce just 20 per cent of its fibre needs, a category comprising leafy vegetables, bean sprouts and mushrooms, by 2035.
High operating costs
Ms Lim cited high operating costs as a key factor ailing her company, which officially launched in November 2022.
Utility bills account for the largest share of the farm’s monthly operating cost, at nearly $20,000, she said. Manpower costs for four workers – who assist with growing and packaging vegetables, as well as upkeep of the farm – amount to more than $15,000 a month, she added.
Ms Lim said she has not drawn a salary since the farm began operations. She oversees operations and carries out deliveries, marketing and all other business functions.
GroGrace was first conceptualised in 2019. At that time, the cost of electricity was about 15 cents per kilowatt hour (kWh), Ms Lim said. But the rate more than doubled to 33 cents per kWh in 2022 when the farm was launched, she added.
Energy prices spiked around the world after Russia invaded Ukraine
Additionally, the Covid-19 pandemic caused delays in the construction of the farm, which began in 2020. What was meant to be a nine-month-long renovation instead took 1½ years, said Ms Lim.
Debts began to accumulate and the company struggled with funding logistics and manpower. “We started running the farm with a negative bank balance,” she said, adding that her farm has failed to turn a profit since it began operations.
ST checks on the financial records of Urban Farming Partners Singapore via the Accounting and Corporate Regulatory Authority portal confirm this. The documents show that the firm has been incurring losses since at least the 2020 financial year, and saw a loss of around $400,000 in that financial year.
Schemes by the Singapore Food Agency (SFA) to help local farmers include grants disbursed under the Agri-food Cluster Transformation Fund, which help to defray the cost of adopting technology for farming operations.
During the farm’s soft opening in August 2022
GroGrace, which taps Dutch horticulture technologies to achieve higher productivity, estimated that it could produce up to 33 tonnes of produce a year within its 750 sq m facility, roughly the size of two basketball courts.
Difficulties reaching consumers
Having the capacity to produce is one thing. Finding customers to sell to is another.
Ms Lim recalled how the farm would donate as much as 40 per cent of its vegetables to non-profit organisation Hao Ren Hao Shi in the months when it could not sell its produce.
GroGrace eventually turned to wholesalers to move larger volumes, although Ms Lim said the vegetables are sold at a loss.
She said the higher costs of her vegetables compared with those of imported varieties have made it difficult for her firm to secure orders.
On GroGrace’s website, 200g of curly kale is sold at $8.60, while other vegetables such as nai bai are sold at $5.80 for 300g.
In comparison, 300g of kale from the European Union goes for $5.99 at FairPrice, while 300g of nai bai from China is sold at $1.97.
Even though the vegetables are marketed as clean and pesticide-free, customers did not bite. Ms Lim added: “Selling vegetables in Singapore is much more difficult than selling a Rolls-Royce or a Rolex.”
The farm, which is still operating at full capacity, now grows up to one tonne of vegetables each week, said Ms Lim. She sells mainly to wholesalers, hotels and e-commerce customers.
“Our biggest competition is the imports from China, Malaysia, Europe or even Australia. So people will ask, ‘Oh, why are Australian produce cheaper than yours?’” said Ms Lim.
She noted that foreign farmers often benefit from policies that subsidise farming costs, while Singapore does not offer such assistance. For instance, in the EU’s budget for 2021 to 2027, nearly €300 billion (S$447 billion) was set aside for the European Agricultural Guarantee Fund
GroGrace, which is still operating at full capacity, now grows up to one tonne of vegetables each week.
ST PHOTO: NG SOR LUAN
Senior Minister of State for Sustainability and the Environment Zaqy Mohamad told Parliament in January that the Government does not intend to provide grants
Ms Lim said that even when new business opportunities come knocking, she has to think twice before accepting.
For instance, she was offered the chance to supply a major supermarket chain here with her vegetables. But she had no more funds to invest in the necessary logistics, including trucks and drivers.
In response to ST queries, SFA said on Feb 12 that it was aware of GroGrace’s impending closure.
“As Singapore’s farming industry remains nascent, SFA is aware of the challenges faced by our farmers, in particular high-tech indoor farms, which are most impacted by inflationary pressures on energy costs, similar to high-tech indoor farms in other countries,” said the agency.
“To this end, SFA will continue to avail space and infrastructure for farming, facilitate access to funding, and support the growth of demand offtake.”
Despite headwinds, the overall Singapore farming sector has been promising, with productivity improving over the years, SFA said. From 2019 to 2024, the productivity of farms increased by 10 per cent for vegetables, 17 per cent for seafood and 50 per cent for eggs.
Ms Lim, who started the farm because of her belief that customers wanted clean, pesticide-free produce, said she does not intend to remain in the industry if GroGrace eventually closes.
Still, she believes that indoor farming is the future of farming, particularly as the agriculture industry is increasingly impacted by climate change.
To boost the local farming sector, she suggested greater partnerships between farmers and agri-food research groups. This could enable commercial farms to benefit from research outcomes, instead of having breakthroughs confined to laboratory settings, she said.
“Use part of my farm for your innovation or commercialisation,” added Ms Lim. “If you develop energy-efficient parts, come install them in my farm and observe them to see how the crops grow in an actual farm, not a laboratory.”
She also expressed hope that the Government can do more to help farms manage operating costs, such as conducting collective bargaining between farms and electricity retailers to secure preferential energy rates.
SFA said it “remains committed to actively supporting the growth of Singapore’s farming industry”, as local production is an important and regenerative source of food that can serve as a buffer in times of supply disruptions.
The agency added that Singapore secures its food security through multiple prongs, with local production being just one pillar. Other strategies to do so include import source diversification, stockpiling, and inking global partnerships.
