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SE_172288
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Pages: 126
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Nov 2017 | 10809 Views
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Author(s) :
Akshay Jadhav
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Tables: 42
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Global Vertical Farming Market was valued at $1,782 million in 2017, and is projected to reach $10,246 million by 2025, growing at a CAGR of 24.4% from 2017 to 2025.
Vertical farming is a non-traditional way of growing crops, which enables ease of harvesting, negligible effect of climate, high yield, minimal usage of pesticides, less area requirement, and less water consumption. It facilitates huge quantity of nutritious and quality fresh food without relying on favorable weather, high water usage, skilled labor, and high soil fertility. Vertical farming is an ideal solution to these concerns, as it consumes 90% less water than traditional farming and increases yield by nearly 70%. It is anticipated to play an important role in contributing to the urban food security, facilitating year-round production, and decreasing food miles.
Vertical farmers are looking for ways to minimize carbon footprint, such as low energy LED lights, which reduces energy consumption by as much as 80%. They use anaerobic digesters, which uses anaerobic bacteria to compost organic material. For instance, Mirai Corp in Japan, a 25,000 sq. foot facility, is the world’s largest indoor farm that uses nearly 45% less power, 95% less water, and 80% less food wastage as compared to outdoor fields. This farm produces nearly 10,000 lettuce head every day. Furthermore, Skygreens in Singapore was the first commercial vertical farm.
The demand for vertical farming is expected to increase rapidly during the forecast period, owing to various factors such as rise in popularity of organic food, increase in urban population, and decrease in arable land.
However, high initial investments and involvement of nascent technology hamper the market growth.
The key players profiled in the report include AeroFarm, FarmedHere, Illumitex, Inc., Koninklijke Philips N.V., Sky Green, Everlight Electronics, Green Sense Farms, American Hydroponics, Hort Americas and Agrilution.
Market Segmentation
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The global vertical farming market is segmented based on component, growth mechanism, and region. Based on component, the market is divided into irrigation component, lighting, sensor, climate control, building material and others. The building material is classified into glass greenhouse and plastic greenhouse. By growth mechanism, the market is categorized into hydroponics, aeroponics and hydroponics. Region-wise, the market is analyzed across North America, Europe, Asia-Pacific, and Latin America Middle East and Africa (LAMEA).
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Increase in popularity of organic foods, limited arable land for traditional agriculture, high initial investment and developmental technologies along with rise in urban population are the significant factors that affect the growth of the global vertical farming market. These factors are anticipated to either drive or hamper the market growth.
Increase in popularity of organic food
Organic food refers to the products obtained through farming system that does not use synthetic fertilizers, pesticides, and growth regulators. In the present scenario, people across the globe have become increasingly aware about the source of food that they consume daily. This results in increased demand for organic food. For instance, in North America, the sale of organic food has witnessed significant growth over the past few years.
High Initial Investment
The global vertical farming market is expected to grow in the future, owing to increase in demand for crops and use of effective agriculture techniques. However, the adoption of vertical farming incurs heavy initial investment, which restrains the growth of the market. Moreover, high requirement for skilled workforce adds to the overall cost of cultivators. Aggregate vertical farming method is used to deliver the passive medium and nutrient solution into the plant root, which is more expensive than other agriculture methods. Moreover, farmers are not fully aware of the operational and technological benefits of complete vertical farming method, which acts as one of the key restraining factors for the market.
Increase in Urban Population
At present, nearly 54% of the world’s population resides in urban areas and is expected to reach 66% by 2050. The future cities are expected to produce their own food due to increase in global population and decrease in arable land. Vertical farming permits farmers to harvest fresh organic crops in ever-growing cities with additional advantages of high yield, pesticides, and low water requirement. Presently, food supplies from traditional farming are used by the urban population. These farmers use pesticides to achieve higher yield and use preservatives to keep the food fresh, as they deliver it to cities. However, rise in demand for fresh, local, and organic food has fueled the growth of the vertical farming market.
Key Benefits
Growth in population has fueled the demand for both more food and more land to grow food; however, availability of arable land is limited and expensive. Vertical farming is an innovative way to grow crop in cities without the need of soil, with minimum water usage and almost no need of pesticides. Crops grown through vertical farming are organic, environmentally safe, and healthy to consume.
Presently, nearly 54% of the world’s population resides in urban areas, and is expected to reach 66% by 2050. The future cities are expected to produce their own food due to increase in global population and limited area of arable land. Vertical farming permits farmers to harvest fresh organic crops in ever-growing cities with additional advantages such as high yield, pesticides, and low water requirement. Presently, food supplies from traditional farming is used by the urban population. These farmers use pesticides to achieve higher yield and use preservatives to extend shelf life of foods. Rise in demand for fresh, home-grown organic food has fueled the growth of the vertical farming market.
According to United Nations Population Division (2009), the global population is expected to increase from about 6.9 billion in 2010 to 9.2 billion in 2050. Presently, the growth rate of global population is nearly 80 million per annum. This is a major concern, as habitable area of Earth is limited to nearly 13 billion hectares. In 2008, the total arable area in the world was near about 4.88 billion hectares. The growth of the vertical farming market is driven by food security, adverse effects of farming on the ecosystem & climate, fitness & nutrition, and others. Moreover, shift from traditional agricultural techniques to vertical farming to cater to the increasing demand–supply gap boosts the market growth.
Hydroponics accounts for the majority of market share in the growth mechanism segment, owing to its capability to produce more nutritious eatables in less space consumption. Moreover, this growth mechanism uses 10 times less water than conventional agriculture. Aeroponics is anticipated to grow with a fast-paced rate in the forthcoming years.
North America is the second highest revenue contributor to the global vertical farming market, after Asia-Pacific. The market growth is attributed to factors such as alarming rate of water level depletion, presence of drought-stricken states, and increase in environmental concerns.
Key players in the vertical farming market are AeroFarm, FarmedHere, Illumitex, Inc., Koninklijke Philips N.V., Sky Green, Everlight Electronics, Green Sense Farms, American Hydroponics, Hort Americas, Agrilution, and others.
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