Roots Sustainable Agricultural Technologies Limited (ASX:ROO) co-founders Dr Sharon Devir and Boaz Wachtel provide an update on plant productivity trials using the company's proprietary heating and cooling system, commercialisation plans and priorities for the next 6 months.
Anna Napoli: Hello I’m Anna Napoli for the Finance News Network and joining me now from Roots Sustainable Agricultural Technologies (ASX:ROO) are co-founders, Dr Sharon Devir and Boaz Wachtel. Sharon and Wachtel, welcome back.
Boaz Wachtel: Thank you.
Dr Sharon Devir: Thank you.
Anna Napoli: First up, could you give us a quick recap of your company and its technologies?
Dr Sharon Devir: Our company has actually two products, one is under commercial phase, the zone heating and cooling system. And the other one is under R&D phase, it is the irrigation by condensation.
Anna Napoli: You’ve had some big wins recently with the China distribution deal and the pilot in Australia, and also some results with basil in Israel. Can you tell me more about them?
Boaz Wachtel: We were able to receive an order of approximately $300,000 from an Israeli integrator that works in China. They made a commitment to purchase Roots products over five years. It’s a condition of commitment to sustain the exclusivity for $19 million. We had good results with basil heating and during the winter, 66 per cent increased yield. We shortened the growing cycle and we improved the shelf life of the basil. So overall, we had very good results in a short time.
Dr Sharon Devir: It can be reflected with our share price, which we started about 20 cents and we are now around 50 cents with a cap of $30 million.
Anna Napoli: How do your main patented technologies work?
Dr Sharon Devir: We are using the ground source heated exchange, in order to exchange heat or cool from the underground to the root zone itself. We’re doing it by using a closed loop with a minimum of water, circulation water. It cools during the summer and heats during the winter. The idea is to use the known physiology and to adapt the temperature of the roots, which are actually the most important part of the plant, to its better condition. This way you can increase yield, productivity, increase the quality, shorten growing cycles and even save a lot of energy with our unique technology.
Anna Napoli: How does that differ to other technologies on the market?
Dr Sharon Devir: Other technologies on the market usually they heat and cool the volume of the greenhouse itself, like in air-conditioning at home. One thing is very important to emphasise that cooling system is hardly existing in agricultural. And if it exists, it is two separate systems. One is dedicated for heating and one is dedicated for cooling. In our system we do both, heating and cooling in one system with a very lot of success.
Boaz Wachtel: I wanted to touch on the second technology, which is irrigation by condensation. We chill water in an insulated water tank, we circulate them in an enclosed cycle and the humidity in the air is condensed on the external surface of the pipe. We’re able to sustain five crops just from humidity in the air, no additional irrigation was used, so we see a great future to help remote communities. Or also greenhouse farmers to access water for irrigation, and not from boreholes or upper fields or streams, but from humidity in the air. That is a revolutionary achievement I think for Roots, and it will soon express itself I think in the financial results as well.
Dr Sharon Devir: Both technologies can be controlled by the farmer, either by his PC or by his Smartphone. He can monitor this system, he can control the system and can use the tool as much as he thinks is better for his crop.
Anna Napoli: How do Root’s technologies fit the global trends in agriculture?
Boaz Wachtel: One is to grow crops near to population centres, so you don’t have to move the tomatoes or cucumbers 2,000 kilometres. It means that you seek technologies to adapt to local climatic conditions, regardless where the population centres live. Secondly is to reduce the environmental impact of agriculture. And we do that by reducing the energy expenditure that we have in the system, compared to other systems. And thirdly is the access to water, there is a lot of stress on water resources globally. And Roots technology of the irrigation condensation addresses water shortages. And because agriculture takes 70 per cent of all water resources, we address that need with our irrigation by condensation. Hopefully we can have a global impact in the next couple of years.
Anna Napoli: What would you say makes your company a compelling investment?
Dr Sharon Devir: Our company floated only three months ago, we’ve already started sales in the largest territory in the world, in China. It was a very good deal. We have additional technologies in our pipeline, we have additional three territories that we are working on in Spain. We just recently started in Australia and in Israel. And in the next quarter, we will start to move from piloting to sales.
Boaz Wachtel: We’ve a very strong IP family around our two technologies. We’re registering new patents and the demand for our technologies is quite great, from different parts of the world. Due to climate extreme weather, we address this issue in a very innovative and cost effective, and energy efficient manner. So overall, with the future sales from other companies, by being at the forefront of agricultural technologies in the world.
Anna Napoli: Boaz, I believe the former Australian Ambassador to Israel has just joined the company. Can you tell me more?
Boaz Wachtel: Yes Ambassador David Sharma, who finished four years of staying in Israel as an ambassador, decided to join Roots, because he believes in the potential impact of the technologies, both here in Australia to help local farmers and globally. And we’re very pleased to welcome him on board, he’s a very well connected figure. And I think he will help us also expand commercially, and also vis-a-vie the Australian Government and some other foreign governments, to push these technologies forward.
Anna Napoli: Sharon and Boaz, thank you for the update.
Dr Sharon Devir: Thank you very much.
Boaz Wachtel: Thank you very much.