Vertical Farming Market Size, Trends and Growth Analysis by 2027

The vertical farming sector is projected to grow significantly, reaching an estimated US$ 19,864.8 million by 2028, up from US$ 4,300.2 million in 2021. This growth represents a remarkable compound annual growth rate (CAGR) of 24.4% from 2021 to 2028.

Currently, one of the most prominent trends in the vertical farming industry is the adoption of precision agriculture technologies. These technologies encompass a range of tools such as automatic steering, yield monitoring, remote sensing, in-field electronic sensors, and spatial data management. As the demand for food continues to rise, farmers and agricultural professionals are increasingly turning to precision farming techniques. This shift aims to enhance time management, minimize water and chemical usage, boost crop yields, and cultivate healthier produce. By leveraging GPS, data analytics, and specialized applications, precision farming enables farmers to optimize their outputs. Data-driven maps assist in determining the appropriate amounts of seeds, water, fertilizers, and pesticides needed for specific areas, as well as indicating the optimal harvest times. The growing awareness and understanding of precision farming, particularly in rural regions, is expected to positively influence the vertical farming market throughout the forecast period.

The vertical farming ecosystem comprises several key stakeholders, including component manufacturers, distributors, retailers, and end users. Many companies have entered into contracts with manufacturing firms, and there is a noticeable trend of outsourcing product design. Currently, both manufacturers and design firms are collaborating to provide custom designs and component selections, addressing the technical challenges associated with developing vertical farms. Component manufacturers and technology providers possess the necessary expertise to deliver advanced, efficient, and user-friendly solutions that facilitate effective operations within vertical farming environments.

Impact of the COVID-19 Pandemic on the Vertical Farming Market

The COVID-19 pandemic has had a significant impact on the vertical farming market, particularly in North America. Countries such as the United States, Canada, and Mexico experienced a surge in COVID-19 cases, prompting governments to implement containment measures that restricted movement. These measures resulted in lower production volumes at manufacturing facilities, adversely affecting the supply chain for vertical farming equipment. Additionally, workforce shortages in various regions led to delays in the delivery schedules of vertical farming equipment during 2020.

As vaccination efforts began and containment measures were eased in late 2020 and early 2021, the situation started to improve. In Europe, countries like Russia, the UK, Italy, Spain, Germany, and France also faced significant COVID-19 outbreaks, housing numerous vertical farming equipment manufacturers. The initial shutdown of supermarkets during the pandemic's peak resulted in a notable decline in demand for vertical farming equipment among retailers. Many businesses in these regions prioritized maintaining operations with existing resources rather than investing in new technologies. However, the adoption of vertical farming systems began to gain momentum starting in the first quarter of 2021.

The overall size of the vertical farming market has been determined through a combination of primary and secondary research methods. The research process commenced with extensive secondary research, utilizing both internal and external sources to gather qualitative and quantitative data related to the market. This approach not only provided a comprehensive overview but also facilitated forecasts for the vertical farming market across various segments. The analysis includes insights based on five major regions: North America, Europe, Asia Pacific, Middle East & Africa, and South America. Furthermore, primary interviews were conducted with industry participants and experts to validate the data and gain deeper analytical insights. Participants included industry professionals such as VPs, business development managers, market intelligence managers, and national sales managers, along with external consultants like valuation experts, research analysts, and key opinion leaders specializing in vertical farming.

Some of the prominent players in the vertical farming market include Eden Green Technology, Elevate Farms Inc., iFarm, OSRAM GmbH, Plenty Unlimited Inc., Sky Greens, Vertical Farm Systems, Square Mile Farms, Agrilution, and AeroFarms.