Singapore’s GroGrace Farm Faces Closure Amidst High Costs and Shifting Government Priorities

SINGAPORE – Urban farm GroGrace, operated by Urban Farming Partners Singapore (UFPSG), is facing imminent closure despite efforts by its co-founder, Grace Lim, to secure partnerships and investment. The farm announced a potential closure date of February 14th, but Lim is extending the deadline to the end of February as she explores options to keep the business afloat.

A Struggle Against Rising Costs

GroGrace, launched in November 2022, has been grappling with significant operational costs. Utility bills alone amount to nearly $20,000 monthly, although manpower expenses for four workers exceed $15,000 per month. Lim has not taken a salary since the farm’s inception, dedicating her efforts to operations, deliveries, marketing, and overall business management. The Straits Times reports that the farm began operations with a negative bank balance and has yet to turn a profit.

A key factor contributing to these challenges is the dramatic increase in electricity costs. In 2019, electricity rates were around 15 cents per kilowatt hour (kWh), but surged to 33 cents per kWh by the farm’s launch in 2022, following global energy price spikes triggered by the Russia-Ukraine war.

Industry-Wide Challenges and Government Policy Shifts

GroGrace is not an isolated case. Several other vegetable farms in Singapore, including I.F.F.I and Growy, have closed in the past three years. As of February 4th, Singapore had 101 licensed vegetable farms, a decrease from 115 in 2023. Agri-tech experts attribute these closures to high capital and energy costs, supply chain disruptions, and waning investor confidence.

Adding to the difficulties, the Singaporean government announced in November 2025 that it would be dropping its 2019 target of producing 30% of the nation’s nutritional needs by 2030. While the government remains committed to food security, the focus has shifted. The novel target is to produce 20% of Singapore’s fibre needs (leafy vegetables, bean sprouts, and mushrooms) by 2035.

Innovative Technology and Market Barriers

GroGrace distinguishes itself through its use of Dutch horticulture technologies, specifically a dry hydroponics system. This system, where plant roots are partially submerged in nutrient-rich water while remaining well-aerated, allows for higher productivity and reduces disease. The farm, occupying 750 square meters, is capable of producing up to 33 tonnes of produce annually.

Despite producing pesticide-free vegetables, GroGrace has faced challenges in securing consistent sales. The higher cost of locally grown produce compared to imported varieties has hindered its ability to compete. For example, 200g of curly kale at GroGrace sells for $8.60, while a 300g portion of kale from the European Union costs $5.99 at FairPrice. Lim has described selling vegetables in Singapore as “much more difficult than selling a Rolls-Royce or a Rolex.”

Looking Ahead

While GroGrace currently operates at full capacity, producing up to one tonne of vegetables weekly and selling to wholesalers, hotels, and e-commerce customers, its future remains uncertain. Lim suggests that greater collaboration between farmers and agri-food research groups, as well as potential government support for collective bargaining for energy rates, could help bolster the local farming sector. The Singapore Food Agency (SFA) has stated its commitment to supporting the growth of the farming industry through funding, infrastructure, and demand-generation initiatives.