Global Vertical Farming Market Size, Segmentation, Trends and Growth Analysis Forecast by 2031

Vertical Farming Market Analysis and Size :

Vertical farming is currently valued at USD 4.2 billion in 2022, registering a CAGR of 27.3% over the forecast period, 2023-2031.

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Vertical farming is the practice of growing crops in vertically stacked layers. It often incorporates controlled-environment agriculture, which aims to optimize plant growth, and soilless farming techniques such as hydroponics, aquaponics, and aeroponics. Some common choices of structures to house vertical farming systems include buildings, shipping containers, tunnels, and abandoned mine shafts.

Furthermore, the growing depletion of groundwater and changing climatic conditions have urged traditional growers to adopt alternate farming methods. Increasing consumer concerns about health and the abovementioned factors are likely to elevate the industry demand.

The Vertical Farming Market research report includes product categorization, product application, development trend, product technology, competitive landscape, industrial chain structure, industry overview, national policy and planning analysis of the industry, and the most recent dynamic analysis, among other things. The study discusses the worldwide market's drivers, opportunities, and limitations. It discusses the influence of various drivers, trends, and constraints on market demand during the forecast period. The research also outlines market potential on a global scale.

Segmentation :-

The Vertical Farming Market is Segmented by Component Analysis (Hardware, Software, and Services), Structural Analysis (Shipping Container and Building-Based), Growing Mechanism Analysis (Hydroponics, Aeroponics, and Aquaponics), and Geography (North America, Europe, Asia-Pacific, Middle East and Africa, and South America). The report offers the value (in USD million) for the above segments.

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Vertical Farming Market Latest Trends :

The demand for exotic fruits and vegetables has been constantly growing at a higher rate due to the increased purchasing power of consumers. The cost of these exotic products is high, as most of these products are imported, and thus, several research institutions and universities are focusing on establishing more simplified vertical farming techniques to accelerate the production of exotic fruits and vegetables and meet the escalating demand.

Furthermore, the integration of artificial intelligence has been reported to perform the farming tasks that normally require human intelligence, such as learning, reasoning, and problem-solving. AI has helped vertical farmers monitor their crops, collect and analyze data, and make informed decisions.

Thus, the involvement of various technologies has sped up the vertical farming procedures, thereby driving the growth of the studied market.

Market Driver:

Growing Demand for Food Across Globe and Organic Food

Organic food product demand is growing in developing as well as developed nations as it happens to be a healthier option as compared to conventional food products. Organic food produce is not harmful to the body as it does not contain any chemicals. As organic crops are grown without the use of any chemical fertilizers pesticides or even irradiation there is a growing demand for these crops. Since, vertical farming, can result in high production of food and organic foods. Thus, there are chances of getting consistent crop production throughout the year.

Decline Arable Land and Growing Water Crisis to Drive Adoption of Vertical Farms

In 2019, the World Bank Group reported that the overall arable land per capita declined from 0.197 hectares in 2013 to 0.192 hectares in 2016. The scarcity of arable land owing to land degradation has urged farmers to adopt new solutions to produce fresh food. The adoption of vertical farming techniques is expected to enable indoor farm owners to grow crops indoors in layers stacked on racks, in a multi-story building, or a warehouse. It is anticipated that this will emerge as a significant trend in the market by 2030. Thus, the demand for vertical farming is growing over the forecasted period. Restraints Higher Initial Investment

High investment and operating costs of vertical farms are slowing down the growth of the studied market. As per the sources, a single large-scale vertical farming facility may cost more than USD 100 million in construction costs alone, according to industry estimates. Thus, it is difficult for the farmers of developing countries to adopt such expensive farming methods thus slowing down the growth of the studied market.

Covid - 19 Impact on Vertical Farming Market

Urban farming like vertical farming has played a more critical role in the global food system, and the COVID-19 pandemic highlighted its necessity. Thus, the COVID-19 pandemic increased the demand for organic farming as post-pandemic, the market witnessed an increase in investments in alternative farming methods such as vertical farming which is needed to witness population growth, climate change, and emerging infectious diseases. Thus market witnessed significant challenges over the forecast period.

Segmental Analysis By Component Analysis Software Segment is Expected to Witness Significant Growth Over the Forecast Period

Farm Management Software is used to optimize and manage farm operations and production activities. The software helps in automating farm activities such as record management, data storage, monitoring and analyzing farming activities, as well as streamlining production and work schedules. Furthermore, technological developments are expected to drive the growth of this segment. For instance, in September 2023, Ellicottville Greens, a company that has developed a vertical growing system to fit in storage containers, found a home in Olean. Thus, such developments are expected to drive the growth of the studied segment.

By Structure Analysis Building Based Segment is Expected to Witness High Growth Over the Forecast Period

Abandoned buildings are often reused for vertical farming. Many farms across the world are transformed from old meatpacking plants. However, new builds are sometimes also constructed to house vertical farming systems. Thus, due to these benefits offered by the buildings, the demand is expected to increase over the forecast period. Furthermore, the recent developments are expected to drive the growth of the market over the forecast period.

For instance, in May 2023, Siemens provided automation and building technology to the recently opened Bustanica vertical farm in Dubai, the world’s largest of its kind. The USD 40 million facility is owned by Emirates Crop One, a joint venture between Emirates Flight Catering, one of the world’s largest catering operations serving more than 100 airlines, and Crop One Holdings Inc., an industry leader in technology-driven indoor vertical farming.

Technology from the Siemens Xcelerator portfolio has been integrated throughout the farm to ensure efficient production, reduce waste, and increase the farm’s overall sustainability. Siemens Smart Infrastructure’s building management system Desigo CC controls and monitors air-conditioning and ventilation, while Siemens Digital Industries’ SIMATIC automation and control systems deliver optimal growing conditions by controlling the lights and CO₂ levels required by the plants

By Growing Mechanism Analysis Hydroponics Segment is Expected to Witness Significant Growth Over the Forecast Period

Hydroponics involves the process of growing plants using mineral nutrient solutions in sand, gravel, or liquid without using soil. In simple words, hydroponic is a technique for growing plants without soil. Furthermore, the recent development in the hydroponics segment is expected to drive the growth of the studied segment. For instance, in July 2022, Bustanica opened the doors to the world’s largest hydroponic farm, backed by an investment of USD 40 million.

The facility is the first vertical farm for Emirates Crop One, a joint venture between Emirates Flight Catering (EKFC), one of the world’s largest catering operations serving more than 100 airlines, and Crop One, a leader in technology-driven indoor vertical farming. Thus, such developments are expected to drive the growth of the segment.

By Geography North America Region is Expected to Witness High Growth Over the Forecast Period

The North American region is expected to dominate the market owing to the growing concerns about food security and nutrition is expected to open several novel opportunities for the industry to prosper.

The United States is anticipated to invest a significant share in facilitating the ecosystem for future foods. As more consumer insights develop toward “fresh-from-farm-to-table,” the availability of freshly harvested vegetables across retail outlets is expected to increase in the country (which is also the pioneer in adopting this concept).

The onset of urban population dwellings across cities, such as New York, Chicago, and Milwaukee propelled the environment for vertical farming with activities, such as revamping derailed vacant warehouses, derelict buildings, and high rises, which has, in turn, led to an increase in the production of fresh grown foods altogether.

Furthermore, there are new aeroponic systems that are set to begin and are under construction. ​For instance, earlier this year, in 2022, Brooklyn-based Upward Farms unveiled its plans to launch a massive 250,000-square-foot vertical farm located in Northeastern Pennsylvania’s Luzerne County. It is set for an early 2023 opening and the farm will specifically focus on microgreens.

Thus, due to the above-mentioned reasons the market is expected to witness significant growth over the forecast period in the region.

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Vertical Farming Market Competitive Landscape : 

The Vertical Farming Market is highly fragmented due to the presence of many market players working globally and regionally in this market segment. Some of the key market players working in this market segment are:

Key Players :

• Agrilution
• American Hydroponics
• AeroFarms
• BrightFarms
• Everlight Electronics Co., Ltd.
• Freight Farms
• GrowUp Urban Farms
• Green Sense Farms, LLC
• Illumitex, Inc.,
• Vertical Farm Systems.

Recent Development

1) Oct 2022: Grow Generation Corp (GRWG) has opened a 9,000-square-foot store in Richmond, its first hydroponic store in Virginia. GRWG has plans to expand its store presence in the state to capitalize on the emerging hydroponic market. It also signed two new leases for store launches in Mount Holly, NJ, and Hazelwood, MO, which are expected to open by the end of 2022. With these, GRWG expanded its reach to 17 states.

2) July 2022: Bustanica has opened the doors to the world’s largest hydroponic farm, backed by an investment of USD 40 million. The facility is the first vertical farm for Emirates Crop One, a joint venture between Emirates Flight Catering (EKFC), one of the world’s largest catering operations serving more than 100 airlines, and Crop One, a leader in technology-driven indoor vertical farming.

Frequently Asked Questions (FAQ) :

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