Indoor Farming Market Size, Share & Growth | Forecast [2031]

Report Description

Indoor Farming Market Outlook 2031

The global indoor farming market size was valued at USD 39.56 Billion in 2022 and is likely reach to USD 98.76 Billion by 2031, expanding at a CAGR of 10.7% during the forecast period, 2023-2031. The growth of the market is attributed to the rising awareness among people regarding the benefits for consumption of quality, fresh, and organic food products.

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Indoor farming is an innovative and advanced method of growing plants or crops, mainly on a large and small scale space for commercial or household purposes. This method of farming frequently implements combination of budding methods such as hydroponics and use of artificial lights to deliver plants with the light and nutrients required for growth especially in a fixed indoor land.

Crops are grown in three dimensions instead of two dimension in indoor farming and are independent of external weather conditions so that these crops can be grown all year round.

A wide variety of plants can be grown indoors but herbs, fruits & vegetables, and flowers are the most popular types for the farming.

The COVID-19 pandemic outbreak has had a positive impact on the market. Due to adverse effects of the pandemic, a large number of the global population are increasingly inclined towards better quality food consumption and home cooked meals.

These are key factors pushing the demand for organic fruits & vegetables grown in indoor farming are rising significantly.

Meanwhile, lockdown and social distancing norms implemented by government bodies lead to shortage of labors to work in traditional farming and many farmers missed the opportunity of planting seasonal crops, which in turn resulted to increase in indoor farming practices.

Market Trends, Drivers, Restraints, and Opportunities

• Increasing crop yield by using even the stacked layers of potted seeds in minimal space is a key factors driving the market growth.
• Rising government policies for encouraging indoor farming is projected to drive the market expansion during the forecast period.
• Escalating cost of initial investment in indoor farming acts as a major challenge that can restrict the market growth in the coming years.
• Growing variety of crops is not possible in indoor farming. This factor can hamper the market growth during the projected timeline.
• Using Artificial Intelligence robots for detection of diseases in plants and installing 3D cameras for monitoring the plant conditions are projected to create significant growth opportunities for the market.

Scope of Indoor Farming Market Report

The report on the global indoor farming market includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.

Indoor Farming Market Segment Insights

Large scale farming of crops drive the fruits, vegetables & herbs segment

Based on crop categories, the market is divided into flower & ornamentals; fruits, vegetables & herbs; and others. The flower & ornamentals segment is further fragmented into ornamentals, perennials, and annuals. The fruits, vegetables & herbs segment is further segmented into leafy greens, lettuce, strawberry, herbs, tomato, bell & chili peppers, cucumber, and others.

The fruits, vegetables & herbs segment is expected to grow at a rapid pace during the forecast period attributed to large scale farming and increased profit from cultivation of common fruits, vegetables & herbs.

However, the flower & ornamentals segment is anticipated to expand at a substantial CAGR in the coming years due to the rising use of flowers and ornamentals for aesthetic and decorative purpose.

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Greenhouses segment is projected to expand at considerable CAGR

In terms of facility types, the global indoor farming market is segregated into vertical farms, greenhouses, and others. The vertical farms segment is further bifurcated into building-based and shipping container.

The vertical farms segment is expected to account for a major market share during the projected timeline owing to increasing adoption of environmentally-friendly production of vegetables and fruits. Furthermore, the changing food buying behavior of customers is leading to boost in demand for organic food.

This is projected to accelerate the segment growth further. On the other hand, the greenhouses segment is projected to expand at a considerable growth rate during the forecast period due to higher yield production and regulated environmental conditions to improve quantity as well as quality of crops.

Maintaining the environment of the indoor farms boosts the hardware segment

On the basis of components, the market is bifurcated into software and hardware. The software segment is further bifurcated into cloud-based and web-based. The hardware segment consists of sensors, climate control systems, irrigation systems, and lighting systems.

The hardware segment is estimated to register a health growth rate during the forecast period owing to wide adoption of hardware components as it plays a significant role in maintaining the environment of the indoor farms.

However, the software segment is anticipated to grow at a high CAGR during the projected period attributed to the software helps in tracing the batch/patch of fruit and vegetables, supplier details, and area of land/field.

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Indoor Farming Market Regional Outlook

Europe is anticipated to constitute a key market share

In terms of regions, the global indoor farming market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. Europe is anticipated to constitute a key share of the market during the projected period owing to the initiates by several governments in the region for indoor farming.

Additionally, growing adoption of technology such as controlled environment-agriculture and active heat systems is a major driver of the market growth in the region.

However, the Asia Pacific market is anticipated to grow at a rapid pace during the forecast period attributed to the increasing demand of organic food in the region, leading to building of vertical farms, as well as greenhouses to cultivate crops in the region.

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