Published Date: Oct 2019 | Report ID: GMI1525 | Authors: Kiran Pulidindi, Soumalya Chakraborty



Report Format: PDF | Pages: 280 | Base Year: 2018

Industry Trends

Vertical Farming Market size surpassed USD 3 billion in 2018 and will exhibit a massive CAGR of over 27% from 2019 to 2026.



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Vertical farming is a method of cultivating various types of produce in vertically arranged layers, in unused vertical spaces of warehouses, skyscrapers, shipping containers, etc. This process enables profitability for many organizations in order to meet their Corporate Social Responsibility (CSR) through sustainable agricultural practices. The other benefits of vertical farming technology include the use of controlled-environment agriculture technology and indoor farming techniques, where all environmental factors can be controlled for the development of the crop. Vertical farming is carried out through 3 modes or technologies: aeroponics, hydroponics and aquaponics. Each process employs various equipment, fruits, vegetables, herbs and aquatic species. This cultivation technique finds wide usage in several indoor and outdoor applications.



Rapidly growing global population and the demand for higher agricultural yields with limited arable land is the prime factor, which will positively impact the vertical farming market in the coming years. For instance, as per Food & Agricultural Organization (FAO), the urban regions across the world are likely to hold for around 70% of the global population by 2050, which will pressurize to increase the agricultural productivity in the coming years. This technique has numerous benefits over the conventional farming such as, less dependency on soil fertility, low utilization of water, controlled weather conditions through agrochemicals, which will transform the entire agribusiness during the forecast spell. Moreover, its ability to produce high quality fruits, vegetables and herbs throughout the year will further augment product growth in the near term.



Soil erosion continues to be a threat in many regions across the world, which has resulted a shortage in farming land along with rising concerns to climate change may subsequently propel the vertical farming market in the near future. However, high energy consumption, high capital expenditure, limitations to variety of crops grown coupled with lack of awareness & technical expertise may restrain growth in the industry. Nevertheless, sustainable agricultural practice of this type aims to minimize water usage and maximize productivity by growing crops “hydroponically” and is a potential solution for action on climate change.

Vertical Farming Market Report Coverage Report Coverage Details Base Year: 2018 Market Size in 2018: 3.16 Billion (USD) Historical Data for: 2016 to 2018 Forecast Period: 2019 to 2026 Forecast Period 2019 to 2026 CAGR: 27.77% 2026 Value Projection: 22.07 Billion (USD) Pages: 280 Tables, Charts & Figures: 248 Geographies covered (18): U.S., Canada, Germany, UK, Netherlands, Belgium, China, India, Japan, South Korea, Mexico, Brazil, Argentina, South Africa, GCC Segments covered: Product, Technology, Application Companies covered (22): AeroFarms, Urban Crop Solutions, Indoor Harvest Corporation, Green Sense Farms, Sky Greens, American Hydroponics, Illumitex, Agrilution GmbH, Everlight Electronics Co.,Koninklijke Philips N.V. Ltd, MOFLO Aeroponics, SPREAD Co., Ltd, Mirai Co., Ltd, Freight Farms, BrightFarms Inc, Plantagon International AB, Gills N Claws Pte. Ltd, Alesca Life Technologies, General Hydroponics, Inc, Heliospectra AB, GrowUp Urban Farms Ltd., Ecobain Gardens, Inc. Growth Drivers: Soaring population levels leading to imbalances in food demand and supply

Scarcity of farming land: A major natural resource

Stabilized crop production irrespective of climatic changes

Conservation and recycling of natural resources Pitfalls & Challenges: Higher initial investments

Lack of technical acumen

Limitations on the variety of crops grown

High energy consumption (light, air conditioning)

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Fruits, vegetables & herbs popular in limited spaces

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Strawberries, lettuce, leafy greens, and tomatoes are among the most grown vegetables through this technique. Of all produce, lettuce shows a significant growth due to its adaptability to grow in small spaces with limited need for additional care. The segment is likely to continue growing during the forecast period. Many aquatic species including seaweeds are also farmed using this technique. Equipment in the segment accounts for nearly half of the overall market size and is expected to grow with a significant rate in the coming years.



Hydroponics is currently the most popular farming technique

Hydroponics accounted for more than half the worldwide vertical farming market revenue in 2018 and is likely to grow at a significant rate in the near future. Ease of operation and low installation cost makes it the most popular technique for medium to large scale farming. Aeroponics is gaining recognition as it provides superior quality of products with minimum utilization of soil & water resources during the process. With irregular climate changes and uncertain rainfall in the key farming countries, aeroponics is the more sustainable farming technique as it does not depend on rainfall or artificial irrigation methods. Air based moisture is collected in a non-destructive manner to feed the produce, thus eliminating dependence on availability of water.



CSR norms help implementation in developing countries

Vertical farming is broadly classified into indoor and outdoor environment farming techniques. Indoor vertical farms are the largest application segment accounting for 3/4th of the total vertical farming market size in 2018. Indoor vertical farms produce large quantities of fruits, vegetables, and fish in self-controlled environments inside used warehouses, parking spaces and freight or shipping containers. This technique utilizes less water and delivers higher yields with least utilization of land in contrast to conventional farming methods. Furthermore, crops produced through this technique are safeguarded from extreme climatic circumstances. Owing to the ease of farming, many corporate workspaces employ vertical farming to increase their sustainability factor and contribute to green building methods.



Outdoor vertical farming is a technology-based approach for farming which finds wide application in restaurant walls, building walls, and can also be practiced on the stacked floors and shelves of skyscrapers. Regions with limited farming land and less yields mostly prefer outdoor vertical farming techniques to control deforestation.



United Nations Sustainable Development Goals encourage vertical farming

The UN Sustainable Development Goals lists the need for achieving food security, improved nutrition and promoting sustainable agriculture globally. The organization aims to seek sustainable solutions to end hunger by 2030. With declining arable land, retreating quality of existing farmland, soil erosion, erratic climate and rainfall, vertical farming techniques with low dependence on climate are being looked at as solutions to improve quality of life. With progressive solutions and implementation, Europe vertical farming market holds the largest demand, with over one-third of the entire global share. This is due to the presence of extensive R&D centers and venture capitalist in the region.



Asia Pacific displayed the highest YoY growth for aeroponics, hydroponics and aquaponics over recent years and could overtake other continents in the near future. Singapore, South Korea and Japan are constantly investing in these technologies due to growing land scarcity in the region. Australia, ASEAN countries, India and China will see a huge upheaval in vertical farming in coming years.



In North America, the U.S. has implemented various programs to provide benefits to farmers who implement vertical farming. Large demand for exports within the Americas will drive the LATAM market to adopt more sustainable solutions.



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Declining food self-reliance, changing food patterns, and initiatives taken by various governments to promote this farming methodology will drive vertical farming techniques globally.



Production expansions, sustainable company policies, driving the need

Few of the major players in the vertical farming market include Green Spirit Farm, Sky Greens, Aerofarms, Mirai Co. Ltd., Plantagon International, General Hydroponics, American Hydroponics, Urban Crop Solutions, Spread Co., etc. Most of these companies are at their emerging stage and are implementing several strategies to attract investments. These steps will expand their production capacity and improve the product reach to several potential customers across the world. Several firms are adopting unique approach and different business models to sustain and make vertical farming a profitable business.



Companies in the market are also collaborating with other firms to expand its global presence. For instance, Green Sense Farms, an US based agri-business, partnered with ‘Star Global Agriculture’, to build a network of about 20 farms in Shenzhen, Beijing, Shanghai, and Chengdu in China. Many companies distribute their products, mostly through collaboration with food companies or through direct selling to restaurants, retail stores and supermarkets.



The vertical farming market research report includes in-depth coverage of the industry with estimates & forecast in terms of volume in thousand units & revenue in USD million from 2016 to 2026 , for the following segments:

By Product

Equipment Lighting systems Pumps & irrigation systems Tanks Sensors Pipes Climate controllers Meters & solutions

Fruits, vegetables & herbs Tomato Lettuce Bell & chili peppers Strawberry Cucumber Leafy greens

Aquatic species Tilapia Bass Trout Salmon Crab



By Technology

Hydroponics

Aeroponics

Aquaponics

By Application

Indoor

Outdoor

The above information is provided on a regional and country basis for the following:

North America U.S. Canada

Europe Germany UK Netherlands Belgium

Asia Pacific China India Japan South Korea

Latin America (LATAM) Brazil Mexico Argentina

Middle East & Africa (MEA) South Africa GCC



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