MOREHEAD, Ky. — AppHarvest set out to reimagine the agriculture industry, but this week the indoor farming company based in Morehead filed for voluntary Chapter 11 bankruptcy.

What You Need To Know

  • Morehead-based, Appharvest filed for Chapter 11 bankruptcy on Monday 

  • The indoor farming company built large greenhouses for fruit and vegetable farming and looks to transform the US farming industry 

  • Chapter 11 bankruptcy allows the company to continue operations while restructuring finances and operations 

  • According to its most recent SEC filing, Appharvest employs around 500 people full-time, with 414 independent contractors

AppHarvest launched in 2018 with fruitful ambitions of transforming the U.S.’ farming industry, by building massive greenhouses for fruit and vegetable farming.

“I’m so proud to represent the 6th congressional district which is rapidly becoming the ag-tech capitol of the world,” said U.S. Rep. Andy Barr, R-Lexington, at an event in Sept. 2021.

Three years later, the company’s dreams of a flourishing ag-tech world could change after filing Chapter 11 bankruptcy in a Texas court on Monday. The company says filing Chapter 11 bankruptcy allows them to continue operations while transitioning its finances and operations.

“You never want to see any business, especially locally file for any kind of bankruptcy,” said Morehead mayor, Laura White-Brown.

The Morehead-based company was founded in 2018 by University of Kentucky graduate, Jonathan Webb.

In 2020, AppHarvest opened its first 60-acre greenhouse in Morehead, growing tomatoes and bringing hundreds of jobs to the city of 7,000.

White-Brown said the company put Morehead and Rowan County on the nationwide map.

“We are kind of a rural community in eastern Appalachia so anytime that an industry chooses to invest here, it’s a big deal for us it boosts our local economy in every way you can imagine,” White-Brown said.

Now, AppHarvest has three other locations in Berea, Somerset and Richmond where they grow tomatoes, salad greens and berries.

“I love the company; I think the entire concept is phenomenal and has and will continue to really make a difference in terms of hunger issues and food shortage,” White-Brown said.

AppHarvest went public on the NASDAQ in 2021, opening at $36 a share. Now, the troubled company’s stock has plummeted with prices at nine cents a share.

Q2 results released in Aug. 2021 showed a $3.1 million income on its first harvest with a loss of $32 million. That led to federal lawsuits alleging the company misled investors.

Needing cash, in November and Dec. 2022, the company sold its Berea farm to its distributor Mastronardi Produce for $127 million.

In 2023, all four farms began shipping produce products to grocery store chains and restaurants. The company hopes to transfer operations of its Berea farm to Mastronardi.

Shipping and business operations are continuing for now on all four farms.

This month the company announced founder Jonathan Webb stepped down as CEO, replacing him was Tony Martin.

In Sept. 2022, AppHarvest partnered with Mayesville Community and Technical College to provide high-tech agriculture education to high school students. MCTC president Laura McCullough said in a statement sent to Spectrum News 1, “As a part of this initiative, we were able to provide container boxes where students learned a variety of skills needed to work in the agriculture industry. We are thankful for the partnership we have had with AppHarvest and their commitment to the education of students in this region.”

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