PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1258813
PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1258813
According to Stratistics MRC, the Global Vertical Farming Market is accounted for $4.16 billion in 2022 and is expected to reach $18.21 billion by 2028 growing at a CAGR of 27.9% during the forecast period. Vertical farming is the practise of stacking farms vertically. This has allowed tiny plots of land to be used for more output. It is an unconventional crop cultivation approach that allows for easy harvesting, a minor effect of climate, high yield, less pesticide use, less land required, and less water consumption. For example, one hectare of vertical farming is equivalent to nine hectares of regular outdoor farming and saves roughly 200 tonnes of water each day. This agricultural method decreases the difficulty of obtaining arable land.
According to the USDA report area of land on farms has been decreasing year by year, in 2017 the area was reported to be 364.36 million hectares and in 2021 it dropped to 362.31 million hectares.
The benefit of vertical farming is that it is not weather dependent; this means that vertical farming may produce crops all year long without worrying about the influence of unfavorable weather conditions on yield quality and profile. Farming in a protected, well-monitored, and regulated setting ensures high-quality food and provides growers with repeatable, programmable output. Furthermore, vertical farming successfully reduces harvest times and increases production while maintaining 100% consistency in produce quality and flavor. This helps the growers to confidently commit to the delivery schedules and offtake agreements demanded by their customers.
Space, light, water, carbon dioxide, and land are all readily available in conventional farming. Yet, for vertical farms, all of these variables imply a high supply cost. Indoor farms make use of artificial lighting. The cost of air cooling and heating to keep the temperature stable, as well as precise monitoring and other relevant software, is included. Similarly, appropriate structures must be built to deliver nutrients and create a platform for crop growth. As a result, vertical farm upkeep and resource supply are highly expensive.
As the demand for cannabis grows rapidly, the supply side has begun to build operations in various forms to meet the need. There has been a massive blooming in cannabis vertical farms and cannabis distributors, which is helping to meet demand. Growing cannabis on a vertical farm might be a costly operation in the current production scenario. Several aspects must be considered when growing cannabis in a sunless medium. For example, the heat released by high-pressure sodium lamps (HPS) might harm produce. As a result, LEDs, which operate at significantly lower temperatures, may provide a solution to the excessive heat emitted.
Plants require natural resources such as light, space, CO2, and water for growth. Nevertheless, in vertical farming, all of these necessities must be supplied externally at a cost, such as all buildings must be lighted with electric lights to grow the plants. Yet, the cost of power is so high that earning a profit between the electricity price and the building bill is unfeasible. Furthermore, no matter how large the facility is, the energy spent per plant remains the same, requiring a well-equipped system. A management and maintenance crew is also necessary to oversee large-scale operations, which could damage cultivators' profitability, making it difficult for them to run vertical farms on a large scale.
The COVID-19 epidemic has slowed the global economy and harmed several industries, including food and agriculture. The agriculture industry was severely disrupted as a result of supply chain disruption, food shortages, and the suspension of import and export between nations. The COVID-19 epidemic has highlighted the necessity of local food and urban farming, such as vertical and indoor farms. The COVID-19 epidemic impacted the urban food system, retail, and distribution because to the high population density. Yet, the COVID-19 pandemic has heightened the need for safe and nutritious meals. Vertical farms will gain traction as a result of increasing demand for organically cultivated goods during the pandemic.
The hydroponics segment is estimated to have a lucrative growth, due to simple installation and cost-effective vertical farm setup. Mineral nutrients dissolved in water are given directly to the plant's roots in a hydroponics system, causing the plant to grow largely upward, promoting faster growth, faster harvest, and higher yield. Hydroponics systems are used both indoors and outdoors to grow herbs, foliage, and food items all year long by employing an inert growth medium to attach the plant's roots. Additionally, nutrition levels can be completely managed, leading in cheaper nutrition expenditures and steady and high yields.
The shipping container-based vertical farms segment is anticipated to witness the fastest CAGR growth during the forecast period, this expansion is ascribed to the structure's ability to assist produce crops regardless of geographic location. One of the key advantages of container-based farming is that it is easy to transport, and it does not require a large plot of land or a specialised structure to begin producing. Furthermore, as competition increases, the price of shipping containers falls since the cost of acquiring old containers is relatively low, allowing other enterprises to enter the market. Yet, some of the disadvantages of this type of agriculture are low comparative productivity and antagonism between light, heat, and layout.
North America is projected to hold the largest market share during the forecast period owing to the presence of many vertical farms across the U.S. and the adoption of robotics and automation technologies across the farms. Rising demand for organic, fresh, and high-quality food drives market growth in the United States and Canada. Furthermore, the use of Cannabis is legal in some places in the United States and Canada. Vertical farms are suitable for growing cannabis, which is projected to drive the vertical farming market expansion. For example, in January 2019, Thrive Agritech, Inc. supplied 1,900 LED grow lights to Choice Labs, a marijuana producer in Michigan. The lights help to increase plant quality while lowering operational costs.
Asia Pacific is projected to have the highest CAGR over the forecast period. The loss of fertile land for agriculture in countries such as China, India, and several Asian countries is expected to increase demand for this novel agricultural approach. Water scarcity and rising food demand in India, China, and Japan are projected to open up new business opportunities across the region. Farmers in Asia have faced years of drought, lack of rain, climate change, insufficient irrigation systems, financial issues, crop failure, greater reliance on chemical fertilisers, and limited crop variety. This is projected to increase the demand for innovative farming techniques in the coming years.
Some of the key players profiled in the Vertical Farming Market include: Agrilution GmbH, Green Sense Farms, LLC, Illumitex, Inc., AeroFarms, Vertical Farm Systems, Freight Farms, GrowUp Urban Farms Ltd., Brightfarms Inc., American Hydroponics, Everlight Electronics Co., Ltd., SkyGreens Pte Ltd, Jones Food Company and SweGreen
In October 2022, AeroFarms have decided to expand nationwide from the Northeast region to all whole food markets, especially after seeing increasing demand for their specialty green. AeroFarms will be the first indoor farming company to be part of the Whole Foods Market Global Planogram.
In October 2020, BrightFarms secured USD 100 million to expand its indoor farming. The funding round was led by Cox Enterprises. The company aims to leverage this funding amount to invest in its existing and retail farms. Further, the company aims to expand its presence across the U.S.
In February 2020, Illumitex Inc. launched an AI platform based on computer vision technology to improve FarmVisionAI. The platform provides augmented artificial intelligence and visualization to monitor and control the farming environment.
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