The global vertical farming market generated $ 2.23 billion in 2018, and is estimated to generate $ 12.77 billion by 2026, growing at a CAGR of 24.6% from 2019 to 2026.
Optimum usage of vertical space & energy utilisation, ease in monitoring and harvesting of crops, and limited availability of arable land for carrying out traditional agriculture drive the growth of the global vertical farming market, according to a report by Allied Market Research.
However, high investments and technologies in development phase restrain the market growth. On the other hand, rise in urban population and surge in prominence of organic foods create new opportunities in the industry.
On the basis of structure, the building based vertical farms segment held the largest market share in the global vertical farming market in 2018, contributing for nearly three-fifths of the total market share, and is estimated to maintain its dominance during the forecast period.
Shortage of arable land
This is attributed to surge in urban population, shortage of arable land, and increase in the adoption of techniques of novel food production. However, the shipping container based vertical farms segment is estimated to register the highest growth rate with a CAGR of 28.1% from 2019 to 2026, owing to reduced costs and time taken for construction in comparison to conventional agriculture.
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Greens are grown at Bowery Farming in Kearny, New Jersey, USA. Rise in urban population and surge in prominence of organic foods create new opportunities in the industry.- Photo: AFP
Hydroponics and aquaponics
Based on growth mechanism, the hydroponics and aquaponics segment together constituted nearly three-fourths of the total share of the global vertical farming market in 2018, and is estimated to maintain its lead position during the forecast period.
On the other hand, the aeroponics segment is projected to grow at the largest CAGR of 25.6% from 2019 to 2026, owing to lowered waste generation, reduction in labor cost, and less water requirement to produce fruits and vegetables.
Based on regions, Asia-Pacific and North America together accounted for the dominant share in 2018, accounting for nearly three-fourths of the total market share of the global vertical farming market, and will continue its lead during the forecast period.
Highest growth rate in Europe
However, Europe is expected to grow at the highest growth rate, with a CAGR of 26.0% from 2019 to 2026, due to rise in the concerns related to availability of water in various regions, which presents vertical farming as a viable solution for its consumption of 90% less water as compared to traditional farming.