Vertical Farming Produce Market

The global vertical farming produce market size was valued at USD 1.15 billion in 2020 and is estimated to expand at a substantial CAGR over the forecast period, 2021-2028. The growth of the market is attributed to the increasing government initiatives on smart agriculture and the growing investments by major investors.

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Vertical farming is a type of agricultural method in which crops or plants are grown in stacked vertical layers. In this method, harmful pesticide, soil, and synthetic fertilizer are not used for growing the crops instead the environment is controlled using technological methods. A variety of crops can be cultivated using the method of vertical farming that cannot be grown in the climatic conditions of some regions. The setup for vertical farming needs advanced technology that includes humidity and temperature sensors, cameras, light-emitting diodes (LEDs), and others. The solitary source used for light in vertical farming is LED grow lights. Investments have been made by various independent financiers and venture capitalists due to the increasing integration of advanced technology in vertical farming. Various emerging vertical farming companies are diverting their focus towards low-interest loans to accommodate their company with facilities, machinery, and advanced equipment.

The COVID-19 pandemic had an adverse impact on various industries and shattered the global economy due to emergency lockdown, social distancing, and other regulations imposed by the local governments across the various parts of the world. However, the pandemic had a positive impact on the vertical farming produce market owing to the increasing adoption of harvested crops that are fresh, safe, and have minimum human exposure.

Market Trends, Drivers, Restraints, and Opportunities

• Increasing adoption of vertical farming methods over the traditional methods in countries with adverse farming conditions is anticipated to propel the market growth.
• Wide usage of light-emitting diodes in vertical farming as they are affordable due to advancement in the technology is expected to drive the market expansion.
• Lack of skilled and knowledgeable workforce to manage advanced systems used in this method that includes sensors, artificial intelligence, and others is estimated to restrain the market growth.
• Circulation of air and its uniform maintenance within the vertical farm is a key challenge that can hamper the market growth over the forecast period.
• Rising demand for the cultivation of cannabis using vertical farming is projected to create key opportunities for the market expansion.

Scope of the Report

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

Market Segment Insights

Lettuce segment is expected to expand at a high CAGR

On the basis of crops, the vertical farming produce market is segmented into bell & chili peppers, tomato, strawberry, lettuce, herbs, leafy greens, cucumber, and others. The tomatoes segment held a high share of the market in 2019 owing to the high demand for tomatoes among consumers worldwide. Various large-scale vertical farming companies are moving their focus towards the cultivation of tomatoes to cater to the rising demand of tomatoes. The leafy vegetables grown in vertical farming are also high in demand and held a key share of the market in 2019. However, the lettuce segment is expected to expand at a high CAGR attributed to the mass production of lettuce by small and large-scale vertical farms in an economic way.

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Building-based segment is estimated to grow at a rapid pace

Based on structures, the market is bifurcated into building-based and shipping container. The building-based segment dominated the market in 2019 and is estimated to grow at a rapid pace over the forecast owing to the rising sales revenues as high volume of vegetables can be produced to cater to a huge customer base. The usage of building-based structures reduces the cost of cultivation. Shipping containers are also achieving high popularity among small-scale farmers and start-ups as they enable them to grow crops at any place irrespective of the geographic location. These containers are low in cost and do not need a dedicated building to start the business.

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Hydroponics segment is anticipated to dominate the market

On the basis of growing mechanisms, the vertical farming produce market is divided into aquaponics, hydroponics, and aeroponics. The hydroponics segment dominated the market in 2019 and is anticipated to continue its dominance over the forecast period owing to its ease of operation and low cost for installation. Hydroponics is a method of farming where mineral solutions are inserted around the roots of the plants instead of soil. Products such as artificial ripening agents and pesticides are not used in this method that makes them superior in nutrition. On the other hand, the aeroponics segment is estimated to grow at a considerable rate. In this method, the roots of the plants are hung in the dark which are periodically sprayed with a nutrient-rich solution.

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The Middle East market is expected to expand at a substantial CAGR

In terms of regions, the market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa.

North America led the market in 2019 and is anticipated to continue its lead over the forecast period owing to the increasing consumption of fruits and vegetables grown in vertical farms. Besides North America, the market in Asia Pacific held a key share of the market attributed to the increasing number of vertical farms in certain parts of the region. However, the market in the Middle East is expected to expand at a substantial CAGR due to the increasing exposure of vertical farm builders, designers, and cultivation companies.

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Segments

Segments Covered in the Report

The global vertical farming produce market has been segmented on the basis of

Crops

• Bell & Chili Peppers
• Tomato
• Strawberry
• Lettuce
• Herbs
• Leafy Greens
• Cucumber
• Others

Structures

• Building-based
• Shipping Container

Growing Mechanisms

• Aquaponics
• Hydroponics
• Aeroponics

Regions

• Asia Pacific
• North America
• Latin America
• Europe
• Middle East & Africa

Key Players

• YesHealthFarms
• Agricool
• Bowery Farming Inc.
• BADIA FARMS
• BrightFarms
• GrowUp Urban Farms Ltd.
• Gotham Greens
• InFarms
• Sky Greens
• Plenty Unlimited Inc.
• Spread
• AeroFarms

Competitive Landscape

Key players competing in the global vertical farming produce market are YesHealthFarms; Agricool; Bowery Farming Inc.; BADIA FARMS; BrightFarms; GrowUp Urban Farms Ltd.; Gotham Greens; InFarms; Sky Greens; Plenty Unlimited Inc.; Spread; and AeroFarms. Many of these players have adopted business strategies such as constructing indoor vertical farms, collaborations, partnerships, alliances, acquisitions, and mergers in order to increase their operation expansion, consumer base, and market position globally. For instance, SPREAD Co., Ltd. partnered with J Leaf Corp. in June 2019 to construct techno farms in Japan and Narita. Furthermore, an announcement was made by AeroFarms in April 2020 to build a vertical farm in Abu Dhabi.