Indoor Farming Industry Overview
The global indoor farming market size was valued at USD 39.5 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 13.5% from 2022 to 2030.
Increasing consumer awareness regarding the advantages of consuming fresh and high-quality food is expected to drive the growth of the market. The rising population across the globe, especially in emerging economies such as China and India, has led to an increase in food demand, which, in turn, is expected to spur the growth of the market for indoor farming in the forthcoming years.
Gather more insights about the market drivers, restrains and growth of the Global Indoor Farming Market
However, the changing climatic conditions contribute to existing environmental problems, such as soil degradation and groundwater depletion, affecting the food and agriculture production systems. Governments encourage building indoor farms along with other initiatives to overcome this problem, which, in turn, is expected to fuel the growth of the market. Organic foods are perceived as healthier, nutritious, safer, and more eco-friendly. A critical factor that influences the demand for organic food is the food purchasing behavior of consumers, which is essential for producers, policymakers, and suppliers to implement successful marketing strategies.
According to The World Bank Group, the overall arable land per capita has declined from 0.197 hectares in 2013 to 0.192 hectares in 2016. The scarcity of arable land owing to land degradation has urged the farmers to adopt new solutions to produce fresh food. The adoption of vertical farming techniques is expected to enable indoor farm owners to grow crops indoors in layers stacked on racks, in a multi-story building, or a warehouse. It is anticipated that this will emerge as a significant trend in the market by 2030.
Indoor farms help grow the total crop yield per unit area by using the stacked layers of potted seeds, thereby driving the market. Indoor farming is the practice of growing plants or crops indoors on a small and large scale. Indoor farming implements methods such as aquaponics and hydroponics and utilizes artificial lighting for adequate light levels and nutrients. However, the high initial investment in the building of indoor farms and limitations on the growing variety of crops is expected to hinder the market growth.
Europe held the largest market share in 2021, owing to the adoption of technologies for greenhouses and vertical farms. Developed countries such as the U.K., Germany, the U.S., and Canada are the rapid and early adopters of farming technologies. However, emerging economies such as India, China, Mexico, and Singapore are observing a substantial growth in the adoption of technologies integrated into indoor farms, owing to the rising demand for fresh crops. The increasing disposable income and urban population in the emerging economies have increased the consumption and demand for healthy, fresh, and nutritious food, which is projected to drive the indoor farming market.
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- Vertical Farming Market - The global vertical farming market size was valued at USD 4.34 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 25.5% from 2022 to 2030. The market growth is attributed to the growing adoption of environment-friendly production of fruits and vegetables.
- Irrigation Controllers Market - The global irrigation controllers market size was estimated at USD 770.6 million in 2018 and is expected to register a CAGR of 15.2% over the forecast period. The rising adoption of improved water use efficiencies coupled with the new generation of tech-savvy farmers looking for smart irrigation solutions to decrease water consumption is primarily expected to drive market growth.
Market Share Insights
April 2020: AeroFarms has declared that it is going to build a 90,000 sq. ft. indoor vertical farm in Abu Dhabi as part of $100 million AgTech investments by Abu Dhabi Investment Office (ADIO).
December 2019: AeroFarms announced to build an indoor vertical farm in the Cane Creek Centre with the investment of USD 42 million, a combined industrial park for the City of Danville and Pittsylvania County in the US.
Key Companies profiled:
Some prominent players in the global Indoor Farming market include
- Argus Control Systems Ltd.
- Certhon
- Richel Group
- Netafim
- General Hydroponics
- Hydrodynamics International
- Illumitex
- Lumigrow
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