by Vertical farming is the practice of growing crops in vertically stacked layers or inclined surfaces with the use of hydroponics or aeroponics. In vertical farming, crops are grown indoors using interior lighting rather than natural sunlight. It helps maximizes the use of available space for growing plants. Some key vertical farming products include lighting, climate control, growing media, sensors, and test & measurements. The global vertical farming market is driven by rising demand for locally produced food due to growing awareness about freshness and nutritional value. The growing urban population has accelerated demand for vertical farming as it offers an alternative to limited arable land.
The global vertical farming Market is estimated to be valued at US$ 14.05 Bn in 2023 and is expected to exhibit a CAGR of 4.9% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics
Growing demand for locally produced food: The demand for locally grown fresh produce has witnessed significant growth in recent years due to rising awareness about freshness and nutritional value of locally grown foods. Vertical farms allow year-round local production of fruits and vegetables near urban population centers using less water and land resources. This growth in demand for locally grown produce is expected to drive the vertical farming market over the forecast period.
Rising urban population: Growth in urbanization has accelerated demand for vertical farming as arable land is limited in urban areas. Vertical farms can efficiently utilize vertical space to grow crops within the urban environment and address the rising demand for fresh food in densely populated cities. According to UN estimates, 68% of the total global population is projected to live in urban areas by 2050. This rising urban population will support market growth.
Segment Analysis
The vertical farming market can be segmented into lighting systems, hydroponics components, climate control, sensors and vertical farming software. Hydroponics components segment holds the largest share accounting for more than 50% of the global market. This is due to increasing adoption of hydroponics systems for cultivation of fruits, vegetables and flowers in vertical farms. It has emerged as the preferred method for growing various crops without soil by using mineral nutrient solutions in water. Dominating hydroponics sub-segment is the nutrient film technique (NFT) which uses a very shallow stream of water containing all dissolved nutrients required for plant growth. It is gaining popularity owing to its low cost, high crop yield and controlled environment.
PEST Analysis
Political: Supportive regulations across developed countries for sustainable farming practices without soil will drive market growth. Economic: Vertical farming can lead to 50-70% higher yields compared to traditional farms and higher profits. Social: Younger population is attracted to new indoor farming concept. Technological: Adoption of IoT, AI and robotics is helping to optimize farming processes and resource management for higher yields.
Key Takeaways
The Global Vertical Farming Market Growth is expected to witness high driven by increasing sustainable farming practices, limited arable land availability and growing urban population. The global vertical farming Market is estimated to be valued at US$ 14.05 Bn in 2023 and is expected to exhibit a CAGR of 4.9% over the forecast period 2023 to 2030.
Regional analysis: The APAC region is projected to grow at the fastest rate of around 7% driven by strong government support and initiatives in countries like India, China and Singapore. China is the largest market in APAC and worldwide due to early adoption of technology and massive investments in urban farming.
Key players: Key players operating in the vertical farming market are BASF SE, Eastman Chemical Company, Shandong Acid Technology Co. Ltd, Gujarat Narmada Valley Fertilizers & Chemicals Limited, LUXI GROUP, Perstorp Holdings ABPOLIOLI SpA, PT Pupuk Kujang, Rashtriya Chemicals and Fertilizers Limited, and Wuhan Ruisunny Chemical Co. Ltd. Key players are focusing on developing advanced nutrient solutions and hydroponics systems to improve farm efficiency and crop yields.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
