8 ms·

wow, 10x more expensive? Well, 7% ROI isn't awful for them, though that's still assuming a 100% profit margins. If margins are less than 50% they're again losin

by dlss 10y ago

wow, 10x more expensive? Well, 7% ROI isn't awful for them, though that's still assuming a 100% profit margins. If margins are less than 50% they're again losing to just investing in index funds.

Scarblac 10y ago
It's also not unreasonable to assume that the cost of traditional ways to grow tomatoes will go up further, due to water becoming even scarcer, fossil fuel use being heavily regulated, etc. But more importantly, the second of these plants will probably be cheaper than $200m, and the 50th will be a lot cheaper.
- rm_-rf_slash 10y ago
  When the Ogallala Aquifer runs dry, America's vast everythingbasket will be finished. Even without fossil fuel regulations or even climate change itself, our unsustainable consumption will inevitably require solutions such as these.
  - SEJeff 10y ago
    Well the US also has some of the largest fresh water lakes in the world. I happen to live in Chicago right next to Lake Michigan (as a simple example). The Romans didn't have near the tech we have no a days and managed to create some impressive aqueducts. Given the extreme need, we would figure something out.
    - Retric 10y ago
      The Ogallala Aquifer has more water than Lake Huron and Canada has a rather large stake in the great lakes. So yes, it may add decades, but it's not a long term solution.
    - logfromblammo 10y ago
      ...but the rational, sensible solution would be ruined by NIMBYs and political corruption and horribly exploitative rent-seeking. You almost have to fix the problem before anyone even realizes it is a problem to get it done at a reasonable cost.
  - deleted 10y ago
    [deleted]
koonsolo 10y ago
There is one thing an index fund doesn't give you: food. So it seems logical to compare it to conventional greenhouses instead of comparing it to financial investments.
- evgen 10y ago
  The food is the return on investment, so it is completely appropriate to compare it to a standard financial instrument. An index fund gives you money, which you can use to buy food.
  - koonsolo 10y ago
    You can only buy food if someone made that food, no?
    - Retric 10y ago
      There are a lot of tomatos grown is places that are not Australia.
- piaste 10y ago
  Putting money in a financial investment ultimately means lending it to other people so they can make stuff, and it's perfectly logical to compare it against a production investment where you make stuff on your own. Of course, if all tomato growers closed shop and put their money in index funds, we wouldn't have tomatoes any more. But that would make the price of tomatoes shoot up and the return on index funds crash down, making tomatoes a better investment than index funds.
  - creshal 10y ago
    > Of course, if all tomato growers closed shop and put their money in index funds, we wouldn't have tomatoes any more. But that would make the price of tomatoes shoot up and the return on index funds crash down, making tomatoes a better investment than index funds. Unless, of course, angry hordes murder you because they tend to dislike people who watch famines as a normal market mechanism and suggest diversifying into cakes.
noselasd 10y ago
Well, you're looking at the average cost to produce a ton of tomatoes. The average price received was 1,443 AUD (http://www.ausveg.com.au/resources/statistics/financials.htm http://www.ausveg.com.au/resources/statistics/financials.htm). How Sundrop Farms compare to the average production cost at 843 AUD/ton would be interesting though. There seems to also be huge regional differences, in 2008 the price received for a ton of tomatoes was 224 AUD in Victoria and 1809 AUD in Queensland. (http://ausveg.com.au/LiteratureRetrieve.aspx?ID=86338 http://ausveg.com.au/LiteratureRetrieve.aspx?ID=86338)
elif 10y ago
There is also significantly less risk of the Tomato market crashing, and the potential to sell carbon credits if that becomes a thing in Australia. Or, you know, the ideal notion that having a planet to spend $10 in is better than having a ruined hellscape to spend $11 in.

by dlss 10y ago

wow, 10x more expensive? Well, 7% ROI isn't awful for them, though that's still assuming a 100% profit margins. If margins are less than 50% they're again losing to just investing in index funds.

Scarblac 10y ago

It's also not unreasonable to assume that the cost of traditional ways to grow tomatoes will go up further, due to water becoming even scarcer, fossil fuel use being heavily regulated, etc. But more importantly, the second of these plants will probably be cheaper than $200m, and the 50th will be a lot cheaper.

rm_-rf_slash 10y ago
When the Ogallala Aquifer runs dry, America's vast everythingbasket will be finished. Even without fossil fuel regulations or even climate change itself, our unsustainable consumption will inevitably require solutions such as these.
- SEJeff 10y ago
  Well the US also has some of the largest fresh water lakes in the world. I happen to live in Chicago right next to Lake Michigan (as a simple example). The Romans didn't have near the tech we have no a days and managed to create some impressive aqueducts. Given the extreme need, we would figure something out.
  - Retric 10y ago
    The Ogallala Aquifer has more water than Lake Huron and Canada has a rather large stake in the great lakes. So yes, it may add decades, but it's not a long term solution.
  - logfromblammo 10y ago
    ...but the rational, sensible solution would be ruined by NIMBYs and political corruption and horribly exploitative rent-seeking. You almost have to fix the problem before anyone even realizes it is a problem to get it done at a reasonable cost.
- deleted 10y ago
  [deleted]

koonsolo 10y ago

There is one thing an index fund doesn't give you: food. So it seems logical to compare it to conventional greenhouses instead of comparing it to financial investments.

evgen 10y ago
The food is the return on investment, so it is completely appropriate to compare it to a standard financial instrument. An index fund gives you money, which you can use to buy food.
- koonsolo 10y ago
  You can only buy food if someone made that food, no?
  - Retric 10y ago
    There are a lot of tomatos grown is places that are not Australia.
piaste 10y ago
Putting money in a financial investment ultimately means lending it to other people so they can make stuff, and it's perfectly logical to compare it against a production investment where you make stuff on your own. Of course, if all tomato growers closed shop and put their money in index funds, we wouldn't have tomatoes any more. But that would make the price of tomatoes shoot up and the return on index funds crash down, making tomatoes a better investment than index funds.
- creshal 10y ago
  > Of course, if all tomato growers closed shop and put their money in index funds, we wouldn't have tomatoes any more. But that would make the price of tomatoes shoot up and the return on index funds crash down, making tomatoes a better investment than index funds. Unless, of course, angry hordes murder you because they tend to dislike people who watch famines as a normal market mechanism and suggest diversifying into cakes.

noselasd 10y ago

Well, you're looking at the average cost to produce a ton of tomatoes. The average price received was 1,443 AUD (http://www.ausveg.com.au/resources/statistics/financials.htm http://www.ausveg.com.au/resources/statistics/financials.htm). How Sundrop Farms compare to the average production cost at 843 AUD/ton would be interesting though. There seems to also be huge regional differences, in 2008 the price received for a ton of tomatoes was 224 AUD in Victoria and 1809 AUD in Queensland. (http://ausveg.com.au/LiteratureRetrieve.aspx?ID=86338 http://ausveg.com.au/LiteratureRetrieve.aspx?ID=86338)

elif 10y ago

There is also significantly less risk of the Tomato market crashing, and the potential to sell carbon credits if that becomes a thing in Australia. Or, you know, the ideal notion that having a planet to spend $10 in is better than having a ruined hellscape to spend $11 in.