Vertical Farming Crops Market to Grow at a CAGR of 20.7%

[Research Report] The vertical farming crops market was valued at US$ 282.80 million in 2021 and is projected to reach US$ 1,057.75 million by 2028. It is expected to grow at a CAGR of 20.7% from 2021 to 2028.

Vertical farming involves growing crops in vertically-stacked layers in trays consisting of nutrient media. It is a modern agricultural technique that does not use soil or land for growing crops. Moreover, it does not use pesticides, chemical fertilizers, or other synthetic materials usually used in conventional agricultural practices. Vertical farming is being increasingly adopted in urban areas with a shortage of arable land. 

Asia Pacific is expected to grow at the fastest CAGR in the global vertical farming crops market over the forecast period. The major factors fueling the market are technological innovations and increasing demand for organic food. The population in the Asia-Pacific is rising dramatically. The increasing population is stimulating food demand, which further offers opportunities for the vertical farming crops market players. Moreover, the rising urbanization and increasing adoption of modern agricultural practices are also propelling the market.

Furthermore, major vertical farming crops market players are focusing actively on innovations. Key companies are investing heavily in R&D and are adopting emerging technologies to boost their production. For instance, a Sydney-based start-up, PodPlants, has developed lightweight and portable vertical gardens and has won the Australian Innovation Challenge for its unique technology. Such technological advancements are projected to boost the regional market growth in the forthcoming period.

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Vertical Farming Crops Market: Strategic Insights

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Impact of COVID-19 on Vertical Farming Crops Market

The COVID-19 pandemic has brought unprecedented challenges across various industries, including the global food and beverage industry. Due to lockdowns, travel bans, and shutdown of manufacturing plants, the supply chains were severely disrupted, which led to a decline in sales. Moreover, the manufacturing sector faced a shortfall in product supply because of the shortage of raw materials and labor. However, the vertical farming crops market witnessed positive growth due to the demand for locally-produced, fresh, and organic products. Moreover, the rise in health consciousness among individuals is projected to open profitable growth opportunities for vertically farmed crops over the coming years.

Market Insights

The Rising Popularity of AI-Controlled Vertical Farms

AI-controlled vertical farms enable growers to optimize crop yield by providing data related to the growth patterns of crops, which crops give better yield, climatic conditions required for the crops, and other such factors. Growers can analyze this data and take required actions to improve their yield. Artificial intelligence (AI) can help the industry confront the biggest challenges, such as climatic changes and low availability of resources, from controlling major crop growth to predicting what crops would be delivering better yields. Artificial intelligence is also rising, with over 1,600 start-ups and total investments reaching tens of billions of dollars. The AI-controlled robots monitor the plant growth and continuously adjust the environmental factors to ensure more efficiency and economic output. Thus, artificial intelligence (AI) and the internet of things (IoT) are expected to be the key trends in the vertical farming crops market.

Crop Type Insights

Based on the crop type, the vertical farming crops market has been segmented into tomatoes, leafy greens, herbs, and others. The leafy greens segment accounted for the largest market share in 2019, and the herbs segment is expected to register the highest CAGR in the market during the forecast period. Leafy greens include lettuce, kale, collard greens, spinach, mizuna, beet greens, and microgreens. Leafy greens are suitable for indoor farming because they can be grown rapidly and in relatively small spaces. The rising demand for fresh leafy vegetables from food retail and the food service sector is one of the primary factors driving the segment’s growth. Moreover, the rising trend of “fresh-from-farm-to-table” is also propelling the demand for vertically farmed leafy greens. The surge in research expenditure for indoor cultivation of leafy greens crops is offering lucrative opportunities for market growth.

End-Use Insights

Based on the end-use industry, the vertical farming crops market has been segmented into food service and food retail. The food retail segment accounted for a larger market share in 2020. The food service segment is expected to register a higher CAGR during the forecast period due to increased demand for fresh and high-quality produce from local food distributors, restaurants and cafes, and quick service restaurants. Moreover, growing customer inclination towards consuming fresh salads in restaurants and cafes is driving the demand for vertical farming crops from the food service sector. Some market players are partnering with food service providers to expand the business. For instance, in January 2019, foodservice suppliers Van Gelder and PlantLab, entered into a partnership to produce various fresh vegetables in PlantLab’s fully controlled vertical farming unit. Such partnerships are expected to boost the market over the coming years further.

Farming Technique Insights

Based on the farming technique, the vertical farming crops market has been segmented into hydroponics, aeroponics, and aquaponics. The hydroponics segment accounted for the largest market share in 2020, and the aeroponics segment is expected to register the highest CAGR in the market during the forecast period. In hydroponics, plant roots are submerged in trays containing nutrient solutions. Over the past few years, urban farming using vertical hydroponic systems has gained much attention. These hydroponic farms can optimize plant growth using the latest technology, providing fresh produce while minimizing water usage, land space, transport costs, and pesticides usage. Hydroponics usually generate high-quality crops, and by employing emerging technologies such as artificial intelligence (AI) and internet of things (IoT) technology, the growers get better crop yields.

A few key players in the global vertical farming market are AeroFarms, Agricool, BOWERY FARMING INC., CropOne, Infarm, Plantlab, Plenty Unlimited Inc., Gotham Greens, MIRAI Co. Ltd., and BrightFarms. These companies are investing huge amounts in emerging technologies to boost their crop yield and produce high-quality crops at affordable prices.

Vertical Farming Crops Market Regional Insights

The regional trends and factors influencing the Vertical Farming Crops Market throughout the forecast period have been thoroughly explained by the analysts at Insight Partners. This section also discusses Vertical Farming Crops Market segments and geography across North America, Europe, Asia Pacific, Middle East and Africa, and South and Central America.

Vertical Farming Crops Market Market Report Scope

Market Players Density: Understanding Its Impact on Business Dynamics

The Vertical Farming Crops Market market is growing rapidly, driven by increasing end-user demand due to factors such as evolving consumer preferences, technological advancements, and greater awareness of the product's benefits. As demand rises, businesses are expanding their offerings, innovating to meet consumer needs, and capitalizing on emerging trends, which further fuels market growth.

Market players density refers to the distribution of firms or companies operating within a particular market or industry. It indicates how many competitors (market players) are present in a given market space relative to its size or total market value.

Major Companies operating in the Vertical Farming Crops Market are:

1. AeroFarms
2. Agricool
3. Bowery Farming Inc.
4. CropOne
5. Infarm

Disclaimer: The companies listed above are not ranked in any particular order.

 

Report Spotlights

• Progressive industry trends in the vertical farming crops market to help players develop effective long-term strategies
• Business growth strategies adopted by developed and developing markets
• Quantitative analysis of the vertical farming crops market from 2019 to 2028
• Estimation of global demand for vertical farming crops
• PEST analysis to illustrate the efficacy of buyers and suppliers operating in the industry
• Recent developments to understand the competitive market scenario
• Market trends and outlook as well as factors driving and restraining the growth of the vertical farming crops market
• Assistance in the decision-making process by highlighting market strategies that underpin commercial interest, leading to the market growth
• The size of the vertical farming crops market size at various nodes
• Detailed overview and segmentation of the market, as well as the vertical farming crops industry dynamics
• Size of the vertical farming crops market in various regions with promising growth opportunities.

Based on the crop type, the vertical farming crops market is segmented into tomatoes, leafy greens, herbs, and others. Based on the end-use industry, the market is segmented into food retail and food service. Based on the farming technique, the market is segmented into hydroponics, aeroponics, and aquaponics.