|Fastest Growing Market:||Asia-Pacific|
|Largest Market:||North America|
Need a report that reflects how COVID-19 has impacted this market and its growth?
The indoor farming market is projected to register a CAGR of 7.2% during the forecast period. With the force and isolation of COVID-19, many countries around the world have realized that strengthening food production and distribution systems is key to fighting hunger and tackle the double burden of malnutrition, and the development of indoor farming can aid in embracing all dimensions of various food security.
An increase in health consciousness and consumption of residue-free food has paved the way for the usage of advanced techniques, like indoor farming. People are growing the necessary crops in their own houses on a small scale in order to have food that is free from pests, and this has resulted in a higher yield.
Soil-based indoor farming dominates the market among the various growing types in the indoor farming market. Its ability to enhance the harvesting cycle of the plants, when compared to traditional farming, is driving its market growth.
By facility type, glass or play greenhouses occupy a larger value while indoor deep-water culture system is anticipated to witness the highest CAGR during the forecast period. There is an increase in the demand for sustainable food production in the Middle East, where achieving this is possible by adopting indoor vertical farming technologies in agriculture.
North America accounted for the largest market share in 2020. The United States is a major contributor to the share in the region, followed by Canada and Mexico. The indoor farming market in the Asia-Pacific region is growing rapidly, with the industry being benefitted from government policies.
The market for indoor farming is highly fragmented, with the top players accounting for a minor share. Some of the notable players in the market are AeroFarms, Bright Farms Inc., Bowery Inc., FreshBox Farms, Metropolis Farms Inc., Garden Fresh Farms, and Village Farms International Inc.
Scope of the Report
The market for indoor farming is experiencing rapid growth, owing to the limited land use, water efficiency, and the benefits of controlled farming devoid of any climate change. The advent of indoor farming has also spurred concerns over the environmental impact of conventional farming practices globally. The report on the indoor farming market is segmented on the basis of the growing systems, facility type, and crop types. The report also includes a segmentation analysis based on geography, covering all the major countries across the world.
|Glass or Poly Greenhouses|
|Indoor Vertical Farms|
|Indoor Deep Water Culture Systems|
|Other Facility Types|
|Other Crop Types|
Key Market Trends
Declining Arable Land
One of the main reasons for the diminishing yield is that the cultivable land has been shrinking over the years in addition to unfavorable weather conditions, like droughts, floods, soil erosion, and heavy utilization of pesticides, which is decreasing fertility of the soil, globally. In some of the developing countries such as China, there are approximately 334 million acres of arable land, of which around 37 million acres are non-cultivable, and with a growing population, this poses a major threat. The alternative to creating more arable land is to enhance the yield and productivity of land currently being cultivated. These technologies include high-yielding varieties, management of fertilizers and pesticides, mechanization, irrigation management, and employment of new farming techniques such as indoor farming.
The World Bank statistics in 2016 depict that South Asia is using 94% of its potential arable land. In contrast, in Sub-Saharan Africa, only 22% of the potentially arable land is under cultivation. Moreover, rain-fed agriculture is practiced on 80% of this arable land. Due to such constraints, more production is required from less land, wherein indoor farming helps in a higher yield of different crops.
Therefore, as the arable land is declining, the increasing need for maximizing crop yields would drive the indoor farming market in the future.
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North America is the Largest Market for Indoor Farming
North America accounted for the largest share in the global indoor farming industry in 2020. With the help of high-efficiency LED lights and enhanced indoor management practices, US growers have been able to adopt large-scale indoor farming. Such practices are expected to reduce energy lighting costs by 50%, thus, reducing the carbon footprint of controlled environment agriculture. As per the US Department of Agriculture (USDA), the average yield of conventional lettuce farming doubled by two folds when cultivated through vertical farming. Currently, the indoor farming industry in the United States is predominantly dominated by greenhouse crop production. The demand for greenhouse tomatoes in the United States is driving the market demand for hydroponic operations. Indoor farming is one of the fastest-growing industries in the United States.
According to the UN Food and Agriculture Organization, drylands in Mexico occupy approximately 101.5 million hectares of land, thereby thrusting the need for indoor farming practices. Canada has also seen a positive growth trend, contributing significantly to the world exports of hydroponically grown tomatoes. The growth of hydroponics and aeroponics systems in the region is driving the overall indoor farming market, mainly due to the increasing focus on adopting innovative and efficient technologies to improve yields.
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The market for indoor farming is highly fragmented, with the top players accounting for a minor share and the other small companies capturing the major share in the market.
The market is highly fragmented, with major revenue-generating companies, which are Village Farms International Inc., Aerofarms, Metropolis Farms Inc., Fresh Box Farms Inc., and Bowery Inc, among others, cornering just some part of the market share.
Companies are partnering with other companies to research and develop new production systems. For instance, In April 2021, Aerofarms had undergone a partnership with Hortifrut SA, a certified B corporation in Chile. The partnership will focus on the research and development of blueberry and cranberry production in fully controlled vertical farms and indoor environments.
Companies such as Bright Farms are focused on expanding the production base and are actively involved in setting up new indoor farming systems during the study period. For instance, in 2019, Bright Farms expanded its construction unit with three new sustainable greenhouse farms in Massachusetts, New York, and North Carolina.
The most adopted strategies by these companies have been mergers, acquisitions, and incurring investments for setting up farms, globally. For instance, AeroFarms, the aeroponics giant based in the United States, included IKEA Group and Momofuku Group for investments worth USD 40 million for its global expansion in 2017.
Table of Contents
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Market Overview
4.2 Market Drivers
4.3 Market Restraints
4.4 Industry Attractiveness - Porter's Five Forces Analysis
4.4.1 Threat of New Entrants
4.4.2 Bargaining Power of Buyers/Consumers
4.4.3 Bargaining Power of Suppliers
4.4.4 Threat of Substitute Products
4.4.5 Intensity of Competitive Rivalry
5. MARKET SEGMENTATION
5.1 Growing System
5.2 Facility Type
5.2.1 Glass or Poly Greenhouses
5.2.2 Indoor Vertical Farms
5.2.3 Container Farms
5.2.4 Indoor Deep Water Culture Systems
5.2.5 Other Facility Types
5.3 Crop Type
5.3.1 Fruits and Vegetables
188.8.131.52 Leafy Vegetables
184.108.40.206.4 Other Leafy Vegetables
220.127.116.11 Other Fruits and Vegetables
5.3.2 Herbs and Microgreens
18.104.22.168 Other Herbs and Microgreens
5.3.3 Flowers and Ornamentals
22.214.171.124 Other Flowers and Ornamentals
5.3.4 Other Crop Types
5.4.1 North America
126.96.36.199 United States
188.8.131.52 Rest of North America
184.108.40.206 United Kingdom
220.127.116.11 Rest of Europe
18.104.22.168 South Korea
22.214.171.124 Rest of Asia-Pacific
5.4.4 South America
126.96.36.199 Rest of South America
188.8.131.52 South Africa
184.108.40.206 Rest of Africa
6. COMPETITIVE LANDSCAPE
6.1 Most Adopted Strategies
6.2 Market Share Analysis
6.3 Company Profiles
6.3.2 Bright Farms Inc.
6.3.3 Bowery Inc.
6.3.4 FreshBox Farms
6.3.5 Metropolis Farms Inc.
6.3.6 Garden Fresh Farms
6.3.7 Village Farms International Inc.
6.3.8 Green Sense Farms LLC
6.3.9 Sky Greens (Sky Urban Solutions)
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
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Frequently Asked Questions
What is the study period of this market?
The Indoor Farming Market market is studied from 2016 - 2026.
What is the growth rate of Indoor Farming Market?
The Indoor Farming Market is growing at a CAGR of 7.2% over the next 5 years.
Which region has highest growth rate in Indoor Farming Market?
Asia-Pacific is growing at the highest CAGR over 2021- 2026.
Which region has largest share in Indoor Farming Market?
North America holds highest share in 2020.
Who are the key players in Indoor Farming Market?
AeroFarms, Bright Farms Inc., Bowery Inc., FreshBox Farms, Metropolis Farms Inc. are the major companies operating in Indoor Farming Market.