Vertical Farming Market Size By Product (Equipment [Lighting Systems, Pumps & Irrigation Systems, Tanks, Sensors, Pipes, Climate Controllers, Meters & Solutions], Fruits, Vegetables & Herbs [Tomato, Lettuce, Bell & Chili Peppers, Strawberry, Cucumber, Leafy Greens], Aquatic Species [Tilapia, Bass, Trout, Salmon, Crab]), By Technology (Hydroponics, Aeroponics, Aquaponics), By Application (Indoor, Outdoor), Industry Analysis Report, Regional Outlook (U.S., Canada, Germany, UK, Netherlands, Belgium China, India, Japan, South Korea, Mexico, Brazil, Argentina, South Africa, GCC), Growth Potential, Price Trends, Competitive Market Share & Forecast, 2017–2024
Published Date: April 2017 | 225 Pages | Report ID: GMI1525 Report Format: PDF
Vertical Farming Market size was more than USD 2 billion in 2016 and is estimated to witness growth more than 27% over the projected timespan.
U.S. Vertical Farming Market Size, By Technology, 2013 - 2024 (USD Million)
Soaring population levels, declining food self-sufficiency, scarcity of farming land, higher productivity yields across the globe will be the foremost factors cropping up the global vertical farm market size over the forecast timespan. Vertical farming is an innovative technology and will transform the agribusiness in the coming years. It is used to produce high quality fresh and nutritious food with high yield all through the year. It has benefits over traditional farming as it does not rely on high water usage, high soil fertility, favorable weather conditions and skilled labor.
Vertical farming allows farmers to deliver their produce on schedule and confidently commit to supply-based contracts. Another benefit of a well accomplished vertical farm is that there are no agricultural run-offs or neither there is any concept of seasonal crop. Hence, timely delivery of yield and reduced spoilage and reduced transport costs is anticipated to strengthen vertical farming market in near future.
Vertical farming environment is secured with bio-security procedure that restricts disease and pest attacks on crops. This eliminates the need of herbicides, pesticides and foliar sprays in cropping systems and results in less holding time. This bio-security also leads to the termination of expensive post harvesting processing and product damage washing. Thus, cost effectiveness and reduced usage of harmful chemicals in this system is expected to uplift the vertical farming market.
On the other hand, the high cost of equipment such as lighting costs, channels etc. coupled with strong research expertise required for the setup of vertical farming, lack of awareness in underdeveloped nations and the limited variety of crops to be raised, premium prices might hinder the practice of vertical farming, Scalability is crucial for vertical farm operations and is also a another drawback as they need to harvest enough crops to trade at a profit to large retail chains and not just limited to premium restaurants and independent specialty supermarkets or stores.
Vertical Farming Market, By Product
Vertical farming product market comprises of equipment, fruits, vegetables & herbs and aquatic species. Lettuce, strawberries, tomatoes and leafy greens are the most grown fruits and vegetables across different regions. Lettuce accounted for approximately 30% of the overall fruits, vegetables & herbs market. Raising aquatic species such as fish and crabs through vertical farming are also reaping rewards in some European countries, Singapore etc. Although fish and crabs’ vertical farms are at their nascent stage of popularity, this trend could change over the forecast period with increasing demand for the hospitality industry. Tilapia is a common aquatic species in aquaponics vertical farming.
Lighting systems held a major share in vertical farming equipment market in 2016. Other equipment used in vertical farming are pumps and irrigation systems, pipes, sensors, climate controllers, tanks etc. The market for these equipment is on the rise with increasing popularity and rising demand for fresh and environmentally viable solutions.
Vertical Farming Market, By Technology
The global vertical farming market in terms of technology is segmented into hydroponics, aeroponics and aquaponics. Across different regions, Growing crops through hydroponics technology in vertical farming market is predominant and accounted for more than 50% share in 2016. The economics of growing crops through hydroponic mechanism is its key driver for vertical farming market expansion. On the other hand, this is expected to fall gradually as more sustainable and innovative technologies for growing plants such as aeroponics and aquaponics are coming up. Aeroponics is the fastest growing technology as it involves growing plants in a mist environment and saves 95% of the water when compared with hydroponics system. Aquaponics is forecast to witness growth more than XX over the forecast period. Aquaponics projects are also increasing especially in Western countries as it comprises of raising two components simultaneously i.e. plants and fish.
Vertical Farming Market, By Application
Vertical farming is mainly used either in indoor environment or outdoor environment. Indoor vertical farms were the biggest application segment of the vertical farming market and accounted for a significant share of overall application segment. Indoor farms mainly include growing fruits, vegetables, fishes etc. in warehouses, parking lots, controlled environments, shipping or freight containers. Shipping container-based farming is rising in popularity, especially in U.S. and China, as these farms provide additional incomes apart from the growing seasonal changes that affect outdoor crop quality and yield. Controlled environment agriculture is also gaining traction and thus will further ramp up the demand for setting up indoor vertical farms. Outdoor vertical farming accounted for less than 30% of the overall vertical farming market and is expected to grow at a slow pace during the forecast period.
Vertical Farming Market, By Region
North America held a significant share in the global vertical farming market. Strong technical expertise, established R&D institutes, high concentration if venture capitalists are the prime factors pushing the growth of vertical farming in the region. The vertical farming market in Asia-Pacific will accelerate at a robust pace and is expected to be the largest market for vertical farming by 2024. The majority of the vertical farms are located in Japan and in 2016 it crossed 200 mark. Japan accounted for more than 25% of the overall Asia-Pacific vertical farming market. The market for vertical farming is also on the rise in Singapore due to the land scarcity and high imports as 90% of the food consumption in is fulfilled by imports. Other countries such as China, India, Taiwan, South Korea also offers substantial market potential for vertical farming over the coming years. Declining food self-sufficiency rates, changing food patterns, supportive government policies and subsidies are the vital drivers of Asia-Pacific vertical farming market. Latin America and Middle East & Africa are also expected to exhibit rapid growth by 2024. Growth in Europe will be relatively slow as compared to other regions during 2017 to 2024.
Competitive Market Share
The key players involved in the vertical farming market are Aerofarms, General Hydroponics, Plantagon International AB, Sky Greens, Urban Crop Solutions, Green Spirit Farms, American Hydroponics, Spread co Ltd, Mirai Co.Ltd. These companies are aiming to attract investments from big-ticket players, creating more employment opportunities and delivering fresh produce to the local people. These companies are rapidly developing business models to make vertical farming sector profitable. The companies are inking long term partnership contracts with lighting solutions provider such as system Koninklijke Philips N.V., Illumitex, Inc. Everlight Electronics Co. Ltd etc. Recently, Ecobain Gardens in Canada partnered with Philips Lighting Holding B.V. to replace its fluorescent lights with Philips GreenPower LED Production Modules to have better crop quality, growth and increased sales. Most of the Vertical farms are selling their fresh produce either by direct selling to consumers, supermarkets, retail stores, premium restaurants or by vertically integrating with established food companies.
Vertical Farming Industry Background
Vertical Farming is the new phenomenon in the urban farming in which plants are grown in vertically stacked layers in high-rise buildings, warehouses, shipping containers, barren lands, desserts, parking etc. Bloating population levels, declining arable land, climatic variation levels, year the round crop production, water conservation and recycling are the major factors propelling the growth. However, high capital expenditure required to set up vertical farms and limitation to grow row crops such as rice and wheat etc. may impede the vertical farming market growth over the projected timeframe.
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