Replies to LegCo questions

LCQ11: Hydroponics

Following is a question by the Hon Tony Tse Wai-chuen and a written reply by the Secretary for Food and Health, Dr Ko Wing-man, in the Legislative Council today (June 3):

Question:

In 2013, the Agriculture, Fisheries and Conservation Department spent $6.5 million to establish at the Cheung Sha Wan Wholesale Vegetable Market the first "Controlled Environment Hydroponic Research and Development Centre" (C.E.H.R&D Centre) in Hong Kong to promote the use of vacant units in factory buildings for indoor hydroponic farming and explore a new way forward for developing local agricultural industry. In addition, the authorities published at the end of last year the consultation document entitled "New Agricultural Policy: Sustainable Agricultural Development in Hong Kong", proposing to explore the feasibility of establishing an agricultural park to fortify the development and adoption of modern and diversified production methods in local farms. The consultation document has also pointed out that it is technically feasible to turn vacant factory buildings into "plant factories" which adopt hydroponic farming practices. In this connection, will the Government inform this Council:

(1) whether it has assessed the cost-effectiveness of C.E.H.R&D Centre; if it has assessed, of the outcome; if not, the reasons for that, and whether it will conduct a review;

(2) whether it has specified the period of operation of C.E.H.R&D Centre; if it has, of the arrangement upon expiry of the specified period of operation; if there is no arrangement, the reasons for that;

(3) whether hydroponic farm is one of the permitted uses of factory buildings under the Town Planning Ordinance (Cap. 131) and the land lease conditions of factory buildings; if it is, of the details; if not, the reasons for that;

(4) whether, in the past three years, it reviewed Cap. 131 and the relevant land leases in order to facilitate the establishment of hydroponic farms in factory buildings; if it did, of the details of the proposed amendments put forward in the last review, and the implementation time; if not, the reasons for that, and whether it will conduct such a review;

(5) what policies and measures are currently in place to regulate the establishment of hydroponic farms in factory buildings, including the major conditions to be met for operating such farms;

(6) of the number of applications received by the authorities in each of the past three years for establishing hydroponic farms in factory buildings, with a breakdown of the numbers of approved and rejected cases by district; if there were rejected cases, of the relevant reasons;

(7) in the past three years, of the number of complaints received by the authorities about hydroponic farms in factory buildings, the number of law enforcement operations carried out in response to such complaints, and the respective numbers of cases in which prosecutions were instituted and the relevant warning letters were registered at the Land Registry (commonly known as "imposing an encumbrance") for contravention of the law; whether it knows how many of the hydroponic farms which had been prosecuted closed down their businesses; and

(8) whether it has adopted measures to encourage hydroponic farming on agricultural land (in particular fallow agricultural land which reportedly covers an area reaching 3 800 hectares); if it has, of the details; if not, the reasons for that?

Reply:

President,

The Agriculture, Fisheries and Conservation Department (AFCD) has all along been actively supporting the modernisation of local farming techniques and the production of premium vegetables. In recent years, AFCD has been making efforts to introduce into Hong Kong different modern production methods, such as hydroponics. At the end of last year, the Government put forward the new agricultural policy and proposed to adopt a more proactive approach towards the modernisation and sustainable development of local agriculture, including adopting new farming techniques to enhance productivity. The views we collected during the consultation period are largely in support of developments in the directions proposed. We will accordingly consider other policies and measures in support of developments in this respect.

My reply to the various parts of the question is as follows:

(1) Under hydroponic production, plants are grown in nutrient solution. It may be deployed for factory-like mass production in a completely controlled indoor environment in multi-storey buildings. In 2013, AFCD set up the Controlled Environment Hydroponic Research and Development Centre (Hydroponic Centre) in collaboration with the Vegetable Marketing Organisation to study and demonstrate the advanced techniques and facility involved in order to showcase its merits for the easy reference of the trade and other interested investors. The Hydroponic Centre is not a profit-making commercial project, but a research undertaking aimed at developing agricultural techniques with a view to enhancing the technology level and output of local vegetable production. Before the establishment of the Hydroponic Centre, a few local hydroponic farms were operating in Hong Kong. With the Centre in place, hydroponic farming has attracted media interest as well as the attention of some investors about the positive potential of hydroponic production in Hong Kong. According to AFCD's observations, the trade has invested over $60 million in local hydroponic production. There are now some 20 hydroponic farms supplying hydroponic vegetables. This has given local vegetable production wider room for further development in terms of production method and market share.

(2) The main purpose of setting up the Hydroponic Centre is to study and develop completely controlled environment hydroponic techniques, demonstrate the production methods and facilitate technology transfer to the trade. In the coming years, AFCD will continue to develop and improve the techniques and explore further development plans with the partnering organisation. At this stage, we do not have a specified expiry date for the operation of the Hydroponic Centre.

(3), (4) and (5) To appraise the present-day situation regarding the use of areas zoned for industrial use, the Planning Department (PlanD) is conducting the latest round of review. In view of the industrial uses emerging within industrial buildings, such as hydroponics, PlanD is in the course of consulting relevant bureaux and departments on the operational requirements and technical feasibility of such uses in industrial buildings; the findings will help PlanD consider whether the Master Schedule of Notes to Statutory Plans and the Definition of Terms should be reviewed. As the relevant work is still in progress, PlanD is at present unable to give a definition or categorisation to "hydroponics" in industrial buildings.

With regard to land leases, the conditions of land leases for industrial buildings in general specify that only "industrial and/or godown" uses are permitted. Under these circumstances, the setting up of hydroponic operations in industrial buildings is generally not in compliance with the "industrial and/or godown" uses stipulated in such land leases, unless the owner has applied to the Lands Department (LandsD) for a waiver of the relevant lease conditions and obtained approval.

Should an owner wish to apply for a change of the existing use of the industrial building, he/she should make sure beforehand that the proposed new use is in compliance with the relevant statutory plans. The owner may then apply to LandsD for lease modification for a change in use, or apply for a waiver to relax the restriction of the lease conditions temporarily. If the application is approved, the owner will be required to pay land premium or waiver fee. In the course of processing the application, LandsD will consult the relevant departments. Having regard to the result of PlanD's review and the advice of the relevant departments, LandsD will consider whether it is appropriate to make adjustments to the conditions of new land leases.

(6) Between 2012 and 2014, LandsD received one application which involved the setting up of a hydroponic operation in an industrial unit in Kwun Tong. Since the applicant had not demonstrated that the statutory plan requirements had been complied with, LandsD was unable to process the application.

(7) Between 2012 and 2014, LandsD received six complaints which involved the setting up of hydroponic operations in industrial buildings. LandsD took lease enforcement action against one confirmed case of non-conforming use. In that case, the owner rectified the non-conforming use within the period specified in LandsD's warning letter requiring rectification of the irregularities. Therefore, LandsD did not register the said warning letter at the Land Registry.

As a land lease, being a form of private contract, is enforced by LandsD in its capacity as the landlord and a party to the contract, such action does not involve contravention of the law or prosecution.

(8) Modern hydroponic farms may be set up indoor (such as in industrial building units) or on agricultural land. It provides more flexibility in site selection. While the Government is seeking to promote diversification in and the modernisation of local vegetable production, we consider that decisions as to where and in what way the production facility should be set up are best left to the farmers themselves. AFCD would provide information on hydroponics for reference by the trade as an alternative option for agricultural production.

Establishing modern hydroponic farms, when compared with traditional or organic farms, would require a higher amount of upfront investment. The recurrent expenditure may also be substantial. As such, operators need to have sufficient funding to meet the requirements of hydroponic farming. They should also be well prepared in terms of acquiring sufficient knowledge and understanding of the operation and production techniques, the competitiveness of their products in the market and their marketing strategies in future. In setting up the production facility, they would have to ensure that the necessary approval in terms of land use has been obtained from the relevant regulatory authorities before they kick-start any construction work. AFCD will not indiscriminately encourage the trade to invest and engage in hydroponic farming. Rather, we will advise investors to take all relevant factors into thorough consideration before making any decision, such as the characteristics of hydroponic farming, operating risk, financial liability and the investor's own capability and capacity.

Ends/Wednesday, June 3, 2015
Issued at HKT 15:35

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