Market Definition
Indoor farming technology produces a synthetic environment inside a closed facility, hastening plant development and nutrient uptake. It demands multilayer indoor plant growth, LED lighting, and controlled growing and nutrient systems. Indoor farming increases crop yield and reduces the farming impact on the environment by reducing the distance traveled in the supply chain. It takes less area than conventional farming techniques to cultivate plants using growing shelves installed vertically.
Market Insights & Analysis: Global Indoor Farming Market (2023-28)
The Global Indoor Farming Market is projected to grow at a CAGR of around 11.2% during the forecast period, i.e., 2023-28. The World Bank Group reports that the average amount of arable land per person decreased from 0.197 hectares in 2013 to 0.192 hectares in 2016. The loss of agricultural land has primarily been brought about by its redistribution for non-agricultural uses, including urbanization, highways, industry and housing, as well as soil erosion and pollution in many developing countries.
For example, there are over 334 million acres of arable land in China, of which about 37 million acres cannot be farmed. Given this, farmers are being forced to find new ways to produce fresh food. High-yielding plant types, fertilizer and pesticide control paired with mechanization, proper irrigation management, and the adoption of cutting-edge farming practices like indoor farming are a few ways to counter these issues.
| Report Coverage | Details |
|---|---|
| Study Period | Historical Data: 2018-21 |
| Base Year: 2022 | |
| Forecast Period: 2023-28 | |
| CAGR (2023-2028) | 11.2% |
| Regions Covered | North America: US, Canada, Mexico |
| Europe: Germany, The UK, France, Spain, Italy, Rest of Europe | |
| Asia-Pacific: China, India, Japan, South Korea, Australia, Rest of Asia-Pacific | |
| South America: Brazil, Argentina, Rest of South America | |
| Middle East & Africa: UAE, Saudi Arabia, South Africa, Rest of MEA | |
| Key Companies Profiled | Aessense Corporation, Argus Control Systems Limited, Bowery Farming Inc, BrightFarms, Certhon, Crop One Holdings, Inc., General Hydroponics, Green Sense Farms Holdings, Inc., Metropolis Farms Inc, Netafim, Priva, Richel Group, Signify Holdings, Village Farms International Inc, Windset Farms, Others |
| Unit Denominations | USD Million/Billion |
In fact, Indoor farming could be an adequate method to deal with the prevailing loss in agricultural availability per person. As such, farmers are switching to such farming practices along with high-yielding crops in order to overcome the issue of limited cropland without compromising output quantities. Moreover, using vertical farming, one of its prominent types, they are able to produce crops indoors in layers piled on racks, in a multi-story building, or a warehouse.
Thus, enhancing the yield and productivity of existing cultivated land is the most effective alternative, and by 2030, the trend is likely to become more prominent. Further, by employing hydroponics and artificial lighting to provide plants with the nutrients and light, they would otherwise receive only when grown outdoors, such techniques may be advantageous in raising productivity even in limited arable land areas. As a result, the demand for equipment related to indoor farming is expected to surge during the forecast period.
Global Indoor Farming Market Key Drivers:
Decreased Cultivable Area Globally, Prompting The Repurposing of Existing Agricultural Land. - Unfavorable weather conditions like droughts, soil erosion, floods, and intensive pesticide usage, which are the prominent causes of the decreased cultivable area, have led to reduced yield over time. Growing crops indoors is the best way to address this severe concern affecting soil fertility globally. In addition, it creates new arable land, subsequently increasing the output and productivity of existing agricultural land. With innovative methods like Hydroponics Farming, Aeroponics Farming, Aquaponics Farming, and Vertical Farming, indoor methods are anticipated to gain traction and drive the market during the forecast period.
Global Indoor Farming Market Possible Restraint:
Expensive Initial Setup and Deployment of Equipment - The availability of sufficient funds to begin the process is one of the most crucial components of these practices. Although the method is cost-effective, indoor farming equipment's initial setup and deployment are expensive and require a significant financial commitment. In fact, many agriculture-related businesses find it exceedingly difficult to find investors, thereby discouraging farmers from tapping into this lucrative opportunity. As a result, the installation of IF systems worldwide may be disrupted by the absence of necessary funds, making market expansion challenging.
Global Indoor Farming Market Growth Opportunities
Advent of Cost-Effective and Innovative Technologies for Farming - Many innovations in indoor farming have a short history in the market, and research is now being done to ascertain how they affect a plant's shelf life. For example, LED lighting has a good effect on plants, and the results were encouraging. However, before it can be regarded as optimally beneficial and commercially feasible, the technology is still in its infancy and needs improvement. Many research and development projects are underway to ascertain these technologies' impact on plant shelf life because many such techniques lack a long history of commercial success.
Global Indoor Farming Market Key Trends:
Frequent Adoption of Vertical Farming Across European Countries - Considering a few instances from across the world, Europe is emerging as a leader in vertical farming due to numerous new farms resulting from the competition among nations to control this market. For instance, the Jones Food Company uses vertical farming to produce about 400 tonnes of vegetables like kale, coriander, and radish annually in the United Kingdom. In addition, the business has approximately 5000 square meters of vertical farm area throughout Europe. The uptake of vertical farming paired with strategic alliances is driving the development of indoor farming technology.
Global Indoor Farming Market (2023-28): Segmentation Analysis
Global Indoor Farming Market report by Markntel Advisors includes segmentation analysis based on Facility, and Crop. This breakdown allows businesses to identify specific market segments and tailor their marketing and product strategies accordingly, maximizing their chances of success in the Global Indoor Farming Market.
Based on Facility,
Among all, The Indoor Vertical Farm segment of the market recorded a sizeable revenue share in the historical period. This growth can be attributed to several factors, including the increasing global population and the shortage of fertile land to grow food. As urbanization continues to spread rapidly and industrialization increases, more and more agricultural land is becoming infertile due to various toxic substances in the environment.
Vertical farms offer a unique solution to this problem by utilizing advanced technologies such as hydroponics, aeroponics, and aquaponics to grow crops in a controlled environment. These farms can be set up in urban areas, which helps reduce transportation costs and provides fresh produce to city dwellers who may not have access to fresh, locally grown produce. Additionally, vertical farming allows for the year-round production of crops, which helps address food shortages during the offseason.
Based on Crop,
In 2022, the flowers and ornamentals sector accounted for a significant portion of revenue in the indoor farming market. This segment is expected to contribute significantly to the overall market growth due to the use of ornamentals and flowers for decorative and aesthetic purposes. Annuals, perennials, and ornamentals have been segregated from the rest of the segment. Consequently, the sales of flowers and other decorative items drive the segment's growth.
On the other hand, herbs and microgreens will likely grow at a substantial CAGR in the coming years. Indoor herb cultivation can be done as perennial houseplants or specifically during winter to safeguard delicate herbs like basil and rosemary. Additionally, herbs grown indoors offer several advantages, including aromatic foliage with diverse shapes and hues. However, not all herbs thrive indoors, as their root systems necessitate larger containers. Likewise, Microgreens, with an average growth time of 10-14 days, are used as both visual and flavor ingredients in various dishes, thus, necessitating their cultivation by indoor farmers.
Global Indoor Farming Market Regional Projection
Geographically, the Global Indoor Farming Market expands across:
In the historical period, North America accounted for the largest share of the Global Indoor Farming Market. The US, Canada, and Mexico contribute significantly to the region's share. The potential to produce more with fewer resources is one of the main reasons such farming methods have gained significant traction in developed countries. The average production of conventional lettuce farming, for instance, increased twofold when grown using vertical farming, according to the US Department of Agriculture (USDA). As a result, the region's market is expanding quickly, with government regulations helping the sector.
Global Indoor Farming Industry Recent Developments
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Frequently Asked Questions
A. The Indoor Farming Market is projected to grow at a CAGR of around 11.2% during 2023-28.
A. Decreased cultivable area globally, prompting the repurposing of existing agricultural land is expected to drive the Market during 2023-28.
A. The prominent players anticipated to stiffen the competition globally are Argus Control Systems Limited, Richel Group, Certhon, BrightFarms, Netafim, Bowery Farming Inc, Aessense Corporation, Crop One Holdings, Inc, Village Farms International Inc, Windset Farms, Metropolis Farms Inc, Priva, General Hydroponics, Signify Holdings, Green Sense Farms Holdings, Inc, Others.
A. The indoor farming market's vertical farm segment recorded a sizeable revenue share in 2022.
A. Globally, North America would provide lucrative prospects for the market in the years ahead.
A. frequent adoption of vertical farming across European countries is shaping the growth of the Market.
A. Introduction of cost-effective and innovative technologies for farming is expected to present remunerative opportunities for the leading players in the market during the forecast period.
A. Inefficient funding in the sector, high initial investments are the possible restraints affecting the growth of the market.
Global Indoor Farming Market Research Report (2023-2028) - Table of Contents
