Vertical Farming Market: Current Analysis and Forecast (2022-2028)

Vertical Farming Market: Current Analysis and Forecast (2022-2028)

The vertical farming market is expected to register a CAGR of approx. 25% over the period of 2022-2028. Vertical Farming—also referred to as Indoor farming or urban farming is the process of growing food in vertical layers, typically in structures like shipping containers, skyscrapers, and used warehouses. Organic food is thought to be more wholesome, safe, and environmentally beneficial. The rise of vertical farming depends on rising global demand for food and a rapid increase in urbanization. The market players are following both organic and inorganic growth strategies to sustain the competitive edge. For instance, in October 2022, Aerofarms, announced its plan to expand further in the middle east with a partnership with QFZA and Doha Venture Capital (DVC) to build a commercial indoor vertical farm in Qatar Free Zones (QFZ) that offers unparalleled connectivity and access to the region. Similarly, in June 2021, the indoor farming company Bright farms in view of developing its production level has launched Brightlabs, a world-class innovation and research hub launching at its Ohio growing facility. Furthermore, vertical farming, a non-traditional method of crop cultivation enables a negligible effect on climate, less area of equipment and less water consumption, hence the market is anticipated to grow on account of the increased environment adoption process. However, vertical farming requires equipment which increases the initial cost of setting up the system, also, there is a lack of awareness about the technologies being used in alternative agriculture practices such as vertical farming

• Based on method, the market is segmented into hydroponics, aeroponics and aquaponics. The hydroponics segment accounted for a significant market share and it is estimated that it will grow rapidly during the projected timeframe. Increased demand for organic food coupled with rising urbanisation supports the market share even more on a global scale. For instance, urbanization is expected to result in an annual loss of 1.6 to 3.3 million hectares of prime agriculture land between 2000 and 2030 as per the United Nations Convention to Combat Desertification (UNCCD) which is to drive the demand further for alternative farming practices such as hydroponics.
• Based on structure, the market is divided into shipping container-based and building-based. The shipping container segment accounted for a significant market share and it is estimated that it will grow rapidly during the projected timeframe. This growth is attributed to the ability of the structure regardless of location, to aid with the growth of crops. Additionally, as there is more competition, shipping container costs fall as a result of the comparatively low cost of purchasing secondhand containers.
• Based on component, the market is divided into lighting, irrigation, climate control, building material and others. The lighting segment accounted for a significant market share and it is estimated that it will grow rapidly during the projected timeframe. One of the advanced lighting is artificial lighting offers the necessary light intensity for crop growth.
• For a better understanding of the market adoption of the vertical farming industry, the market is analyzed based on its worldwide presence in the countries such as North America (U.S., Canada, and the Rest of North America), Europe (Germany, U.K., France, Spain, Italy, Rest of Europe), Asia-Pacific (China, Japan, India, Australia, Rest of Asia-Pacific), Rest of World. Asia Pacific constitutes a major market for the vertical farming industry owing to the primary factor projected to drive the demand is growing awareness of the significance of alternative farming due to the decreasing quantity of fertile agricultural land and the growing population in this region. Furthermore, the Asia Pacific region has been expecting an upsurge rise in demand for organic foods. for instance, people in this region consume over 75% of all vegetables across the globe.
• Some of the major players operating in the market include AeroFarms; 4D Bios Inc; Plenty Unlimited Inc; Freight Farms, Inc; Urban Crop Solutions; Sky Greens; Green Sense Farms Holdings Inc; AmHydro; Planet Farms Holdings S.P.A; Koninklijke Philips N.V. Several M&A’s along with partnerships have been undertaken by these players.