Indoor Farming Market

Market Overview:

The global indoor farming market size reached US$ 17.8 Billion in 2022. Looking forward, IMARC Group expects the market to reach US$ 32.5 Billion by 2028, exhibiting a growth rate (CAGR) of 10.4% during 2023-2028. The rising concerns about food security and safety, continual technological advancements and changing temperature and weather conditions represent some of the key factors driving the market.

The Improved Efficiency over Traditional Farming Augmenting the Market Growth

The indoor farming market has been experiencing continuous growth as this method offers improved efficiency over traditional farming methods. Since traditional farming relies on natural weather conditions and the availability of fertile soil to grow crops, which can be unpredictable and often leads to lower yields. This is impelling the demand for indoor farming as it allows farmers to control every aspect of the growing environment, from lighting and temperature to humidity and nutrient levels, ensuring that crops receive the ideal conditions for growth. Additionally, indoor farming requires significantly less water than traditional farming, which is especially important in areas where water resources are scarce is acting as a growth-inducing factor.

Competitive analysis such as market structure, market share by key players, player positioning, top winning strategies, competitive dashboard, and company evaluation quadrant has been covered in the report. Also, detailed profiles of all major companies have been provided. The market structure is fragmented with many large multinational and small players operating in the industry due to the presence of strong competition. The volume of new entrants is moderate in the indoor farming industry on account of its nature of a high capital-intensive market and low product differentiation.

What is Indoor Farming?

Indoor farming is a type of agriculture method that involves growing crops in controlled environments, such as warehouses, greenhouses, or other indoor facilities. It involves the utilization of artificial lighting, climate control, and advanced technologies, such as hydroponics, aeroponics, or aquaponics. Its main aim is to provide an efficient and more sustainable method of food production, especially in urban areas where traditional farming methods may not be feasible due to several factors, including limited space, poor soil quality, or adverse weather conditions. This type of urban farming help to reduce the carbon footprint associated with traditional agriculture, as it requires less water, fertilizer, and pesticide use, and can minimize transportation costs and food waste. Its systems can vary in size, complexity, and crop variety, from small-scale home gardening systems to large commercial operations. Some of the commonly grown crops in the indoor farming method are leafy greens, herbs, microgreens, strawberries, tomatoes, cucumbers, and peppers.

COVID-19 Impact:

The COVID-19 pandemic outbreak had a significant impact on the global indoor farming method. The pandemic has highlighted the importance of food security and self-sufficiency, leading to a growing demand for fresh and locally-grown food, which has positively impacted the overall indoor farming method as it provides a reliable and efficient source of fresh produce that can be grown year-round, regardless of external factors, such as weather or pandemics. In addition, due to the disruptions in the traditional agriculture supply chain, causing delays and shortages in the distribution of fresh produce has propelled the demand for indoor farming method as a more resilient and adaptable alternative as it allows for the production of crops closer to consumers and reducing the dependence on long-distance transportation. However, the outbreak has caused economic uncertainty and volatility, making it more challenging for indoor farming companies to secure financing and investment, which had negatively affected the overall market.

Indoor Farming Market Trends:

The global market is primarily driven by significant growth in the agriculture industry. Coupled with the growing awareness regarding the benefits of the indoor farming method among the masses is providing a boost to the market. Along with this, the increasing demand for fresh and locally grown food products due to the rising concerns about food security, food safety, and environmental sustainability is creating a positive market outlook for indoor farming as it allows for the production of crops closer to consumers, reducing transportation costs and the carbon footprint associated with long-distance food transportation. In addition, the continuous change in the temperature and weather is leading to the growing adoption of the indoor farming method across the globe as it helps in minimizing the chances of crop failures. Moreover, continual technological advancements, such as the emergence of LED lighting, hydroponics, and automation are impacting the market favorably. Furthermore, numerous initiatives are undertaken by the government of several countries to provide financial assistance to farmers is significantly supporting the uptake of indoor farming methods on the global level. Other factors, including rapid urbanization and the penetration of e-commerce websites, are also positively influencing the market.

Key Market Segmentation:

IMARC Group provides an analysis of the key trends in each sub-segment of the global indoor farming market report, along with forecasts at the global, regional and country level from 2023-2028. Our report has categorized the market based on facility type, crop type, component and growing system.

Facility Type Insights:

• Greenhouse
• Indoor Vertical Farms
• Container Farms
• Indoor Deep Water Culture
• Others
   

The report has provided a detailed breakup and analysis of the indoor farming market based on the facility type. This includes greenhouse, indoor vertical farms, container farms, indoor deep water culture and others. According to the report, the greenhouse facility type represented the largest segment as it provides favorable growing conditions, including consistent temperature and humidity levels and protection from pests and disease. Additionally, it allows for year-round growing, regardless of external weather conditions, which enables farmers to produce fresh food throughout the year, even in regions where traditional outdoor farming is not possible during certain months.

Crop Type Insights:

• Fruits, Vegetables and Herbs
  • Lettuce
  • Spinach
  • Kale
  • Tomato
  • Herbs
  • Bell and Chilli Peppers
  • Strawberry
  • Cucumber
  • Others
• Flowers and Ornamentals
  • Annuals
  • Perennials
  • Ornamentals
  • Others
• Others
   

A detailed breakup and analysis of the indoor farming market based on the crop type has also been provided in the report. This includes fruits, vegetables and herbs (spinach, kale, tomato, herbs, bell and chilli peppers, strawberry, cucumber and others), flowers and ornamentals (annuals, perennials, ornamentals and others) and others. According to the report, fruits, vegetables and herbs accounted for the largest market share as there is a growing demand for fresh, locally grown, and pesticide-free fruits, vegetables, and herbs, which are highly nutritious and flavorful. Moreover, these crops are highly valued for their nutritional content, flavor, and culinary versatility, making them popular with consumers and chefs is further impacting the market favorably.

Component Insights:

• Hardware
  • Structure
  • LED Lights
  • HVAC
  • Climate Control System
  • Irrigation Systems
  • Others
• Software
  • Web-based
  • Cloud-based
     

A detailed breakup and analysis of the indoor farming market based on the component has also been provided in the report. This includes hardware (structure, LED lights, HVAC, climate control system, irrigation system and others) and software (web-based and cloud-based). According to the report, hardware components accounted for the largest market share as they allow farmers to precisely control temperature, humidity, CO2 levels, light intensity and duration. Apart from this, the widespread adoption of numerous hardware components aids farmers to create ideal growing conditions for crops, optimize resource use, reduce labor costs, and improve crop quality and yields.

Growing System Insights:

• Aeroponics
• Hydroponics
• Aquaponics
• Soil-based
• Hybrid
   

A detailed breakup and analysis of the indoor farming market based on the growing system has also been provided in the report. This includes aeroponics, hydroponics, aquaponics, soil-based, and hybrid. According to the report, soil-based accounted for the largest market share it is relatively simple and requires less investment in infrastructure and equipment compared to other growing systems, which use water as the growing medium. Furthermore, the soil-based growing system is known to produce crops with a more complex and nuanced flavor compared to hydroponic systems, which can lead to higher demand and better marketability of the crops.

Regional Insights:

• Asia Pacific
  • China
  • Japan
  • Singapore
  • South Korea
  • Others
• North America
  • United States
  • Canada
• Europe
  • Netherlands
  • Germany
  • United Kingdom
  • France
  • Italy
  • Others
• Latin America
  • Mexico
  • Brazil
  • Others
• Middle East & Africa
   

The report has also provided a comprehensive analysis of all the major regional markets, which include Asia Pacific (China, Japan, Singapore, South Korea and others), North America (the United States and Canada), Europe (Netherlands, Germany, the United Kingdom, France, Italy and others), Latin America (Mexico, Brazil and others) and the Middle East & Africa. According to the report, North America was the largest market for indoor farming. Some of the factors driving the North America indoor farming market included the presence of favorable government initiatives, including tax incentives and grants in order to reduce the dependence on imports and improve food security. Additionally, the region is a hub for some of the world's leading indoor farming technology companies, which are driving innovation and development in the industry.

Competitive Landscape:

The report has also provided a comprehensive analysis of the competitive landscape in the global indoor farming market. Some of the companies covered in the report include:

• AeroFarms
• Agricool
• Agrilution Systems GmbH
• Autogrow Systems Ltd
• Bowery Farming Inc.
• Bright Farms, Inc. (Cox Enterprises, Inc.)
• Freight Farms
• FreshBox Farms
• Garden Fresh Farms
• Green Sense Farms Holdings, Inc.
• Logiqs B.V.
• Plenty Unlimited, Inc.
• SananBio
• Sky Greens
• SPREAD Co., Ltd
• Urban Crop Solutions
• Voeks Inc.
   

Please note that this only represents a partial list of companies, and the complete list has been provided in the report.

Report Coverage:

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the indoor farming market from 2017-2028.
• The research study provides the latest information on the market drivers, challenges, and opportunities in the global indoor farming market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the indoor farming industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.