Posted On: DEC-2024 | Categories : Agriculture
The Global Indoor Farming Technology Market reached $22.3 billion in 2023 and $42.6 billion by 2030, with a compound annual growth rate (CAGR) of about 9.6% during the forecast period 2024-2030. Indoor farming, also known as indoor agriculture or indoor vertical farming, is a process of cultivating crops inside a controlled environment. It involves using technologies such as hydroponics, aeroponics, and aquaponics, which enable farmers to practice farming in enclosed structures such as warehouses, greenhouses, or even shipping containers.
Indoor farming is essential to address the growing global population, expected to reach 9.7 billion by 2050, leading to increased food demand. Climate change complicates this issue with erratic weather and natural disasters, necessitating innovative agricultural solutions. The worldwide indoor farming market was valued at approximately 38 billion U.S. dollars in 2022 and is predicted to exceed 55 billion U.S. dollars by 2032. Among the various innovations in indoor farming, vertical farming stands out as one of the most significant. Vertical farming is suitable for large metropolitan areas and smaller spaces like shipping containers. China is one of the largest markets for vertical farming and is expected to experience a compound annual growth rate (CAGR) of nearly 17.8% from 2022 to 2030.
The major technologies used in vertical farming include aeroponics, aquaculture, and hydroculture. Aquaponics has the greatest forecast growth among the technologies, with over ten billion dollars in value growth between 2022 and 2032. In the Asia Pacific region alone, the expected market value of the aquaponics system in 2022 is over 114 Million US Dollars.
Innovation in the Food industry might expand to a $700 billion market by 2030, up from the present market value of $135 billion.
The global area of indoor farms was 2.3 million square feet in 2016. In 2021, that number culminated in between 8.5 million and 16.5 million square feet.
hydroponics, vertical farming, and CEA are increasingly responsible for meeting the world’s food requirements indoors. This industry is expected to generate $25 billion by 2027.
The global vertical farming market was $1.5 billion in 2016 and is expected to reach $6.4 billion by 2023.
Five types of crops are grown under controlled environments, including leafy greens, microgreens, herbs, flowers, and tomatoes.
Hydroponics technology, usually practiced in building agriculture, utilizes 10% less water than conventional methods.
North America is establishing its leading position in the market, occupying approximately 39.2% of the world’s indoor farming technology market.
There US has approximately 52,000 indoor farms, with a billion acres of growing area. Of these, over 35,980 farms in the United States ran a hydroponic system in 2023, per the analysis highlighted in the research.
Nutrient Film Technique (NFT) is the most widely used hydroponic system at present.
Foodborne illness amounts to almost $156 million annually in the United States.
The vertical farming sector has increased growth by more than 24% and is expected to increase between 2018 and 2024.
Farming as manufacturing, where one large-scale factory grows produce indoors, has most successfully been implemented in Japan, where there are 200 such factories.
Today’s high-tech LED systems are ideal for vertical farming.
Indoor farming is now expanding opportunities to farm – in an underground vertical farm and an agricultural city in development.
vertical farming, in particular, can save 90% of space.
Controlled environment agriculture (CEA) is a technique or method of producing plant and animal products through optimizing the nutrients and the climatic conditions such as light, temperature, humidity, gases, and water as well as the supplies of water and nutrients. The development of the CEA market remains high due to the following factors. The CEA market was worth USD 95.42 billion in 2022, and By 2029, it is predicted to be worth USD 212 billion, growing at a CAGR of 14.21%.
Controlled environment agriculture includes various emerging sub-techniques, each with its own strengths.
Greenhouses: Greenhouses are enclosed structures that offer some environmental control while still depending on natural light. They are versatile for different crops and require a moderate initial investment compared to other controlled environment agriculture (CEA) methods. The commercial greenhouse market size was nearly $50 billion in 2024 and is expected to grow to $66.86 billion by 2029. Due to the rising demand for food production to feed the increasing world’s population and in the backdrop of dwindling arable land and erratic weather patterns, the market is expanding.
Vertical farms: These structures maximize space by stacking growing areas, reducing land needs, and boosting urban demand for organic foods. Owing to the growing population and urbanization, the global vertical farming market has been on the rise and is expected to reach above $35 billion by 2032.
The vertical farming market has developed rapidly in recent years due to the growing population and urbanization. It was valued at approximately 5.6 billion U.S. dollars in 2022 and can grow to more than 35 billion U.S. dollars in 2032. The key driver of the vertical farming market is projected to be large, mainly because of the huge market for organic foods.
According to the vertical farming method, more food could be grown for a larger population than a fixed area of conventional farmland. Currently, there are approximately 2,000 vertical farms in the USA. Aerofarms is among the largest producers of aeroponic farming, and Bowery Farming, based in New York City, is the largest vertical farming company in the US with an AI operating system. Companies involved in vertical farming are expected to experience more than 25% growth by the year 2030.
Growth in Automation and AI Integration: Farms using AI-based systems report a 25-30% improvement in yield prediction accuracy. Robotics and automation are expected to power 40% of vertical farming operations by 2025.
Renewable Energy Adoption: Vertical farms powered by renewable energy save up to 40% in operational costs compared to traditional energy sources. Renewable energy powers 35% of vertical farms globally, expected to increase to 55% by 2030.
LED Lighting Innovation: costs have dropped by 80% over the past decade, making vertical farming more affordable. Farms using advanced LEDs report a 20-25% increase in crop yield.
Expansion in Urban Areas: Over 68% of vertical farms are located in urban areas. Urban vertical farms reduce transportation emissions by up to 70% compared to traditional farms.
Sustainability Goals: Vertical farming uses up to 95% less water than traditional agriculture. Over 75% of vertical farms use water recycling systems.
The vertical farming market is projected to grow from $5 billion in 2022 to $15 billion by 2030, at a CAGR of 20.2%.
Vertical farms use 1% of the land and 5% of the water required by conventional agriculture. A single vertical farm produces the equivalent of 4-6 acres of outdoor farmland.
Vertical farms are expected to produce 200 million metric tons of crops annually by 2030. Leafy greens, herbs, and berries dominate, making up 70% of production.
While vertical farming is energy-intensive, advancements in renewable energy are expected to reduce energy costs by 30% by 2030.
North America accounts for 40% of the global vertical farming market, with the U.S. leading. Major players like AeroFarms, Plenty, and Bowery Farming dominate this region.
Europe is home to the most energy-efficient vertical farms, contributing to 25% of global market share. The Netherlands leads with over 50 large-scale vertical farms.
Asia-Pacific is the fastest-growing region, with a CAGR of 24% from 2023 to 2030. Japan and Singapore lead in advanced vertical farming technology.
The Middle East invests heavily in vertical farming to combat food insecurity. UAE’s vertical farm market is growing at a CAGR of 19.5%.
AI and IoT technologies will become integral for real-time monitoring and optimization. Predictive analytics will further reduce resource wastage.
Vertical farming will align with global sustainability goals, with an increased focus on renewable energy. By 2030, 50% of vertical farms are expected to operate entirely off-grid.
Vertical farming will significantly improve food security for urban populations. By 2035, 15% of global fresh produce will come from vertical farms.