The shortage of foods combined with the lack of arable land to feed the growing population has triggered the need for new methods of farming. Vertical farming is a method of growing medicines and crops in a controlled environment. Environmental conditions such as sunlight, humidity, and temperature can be augmented with the help of LEDs. The global vertical farming market report by Market Research Future (MRFR) highlights the various trends and challenges enveloping the market.
The global vertical farming market size can reach approximately USD 6 billion by 2022 exhibiting a CAGR of 26% CAGR over the forecast period (2016-2022). Low dependency on water combined heightened demands for quality foods are expected to drive market growth.
The use of internet of things (IoT) sensors which can provide a controlled environment to indoor farmers can drive the market growth. Automation in farming coupled with analytics which can alert crop growers of any abnormalities and ensure successful yields is likely to drive investments in the market.
The migration to cities from rural regions due to lack of jobs is projected to drive the vertical farming market demand. Changing lifestyles and inclination towards chemical-free crops is expected to spur the demands in vertical farming.
But high initial costs to enter the market space may hinder its growth.
The global vertical farming market is segmented by component, type, and crop type.
By component, it is segmented into hardware, software, and services. The services segment is projected to be the biggest revenue generator in the market. This can be credited to the growth in research and development activities pertaining to indoor farming and demand for foods free of pesticides.
By type, it is segmented into hydroponic, aeroponic, and aquaponic. The hydroponic segment is expected to garner massive growth in the coming years due to its independence from soil. The use of correct nutrients and monitoring of crops in the environment can lead to high yields from the segment. On the other hand, aeroponics can gain a larger market share due to the usage of less water for cultivation.
By crop type, it is segmented into strawberries, peppers, lettuce, tomatoes, cucumbers, spinach, broccoli, and others.
North America held the largest market share due to being first adopters of latest technologies, rising urban populace, and employment generation. Popularity of organic foods is predicted to be the primary driver of the vertical farming market in the region.
On the other hand, the Asia Pacific (APAC) region can be lucrative for the vertical farming market owing to huge investments in urban farming and rapid urbanization in China and Japan.
Europe can be viable for the global market due to efforts taken by the European Environment Agency (EEA) to ensure the constant supply of crops. The use of vertical farming for tackling climate change and boom in population growth can drive the regional interest. In addition, the use of vacant spaces to grow crops and feed consumers is likely to be lucrative for the market. For instance, Plantagon, a Swedish company has planned to assist office spaces in growing indoor crops for its employees. The World Food Building would be capable of producing close to 550 tons of vegetables annually.
The global vertical farming market companies include Hort Americas (U.S.), Agrilution (Germany), Everlight Electronics co. (Taiwan), Illumitex, Inc. (U.S.), Aerofarms (U.S.), Indoor Harvest Corporation (U.S.), Sky Greens (Singapore), Urban Crop Solutions (Belgium), Koninklijke Philips N.V. (the Netherlands), and others.
In 2019, 80 Acres Farms, a U.S. based indoor farming company has decided to renovate dilapidated buildings in New York to sustain its indoor farming operations. The move allows it to be a constant supply of fresh vegetables to well-known retailers such as Jungle Jim’s International Market and Whole Foods.