A recent study conducted by the strategic consulting and market research firm, BlueWeave Consulting, revealed that the global indoor farming market was worth USD 15.7 billion in the year 2021. The market is projected to grow at a CAGR of 10.20%, earning revenue of around USD 30.8 billion by the end of 2022. The global indoor farming market is flourishing at a high rate owing to the rising demand for fresh food items and increasing health consciousness among consumers. Furthermore, the rising global population and constraints on land and resources due to agriculture may further emerge as a major driving factor for the growth of the market. However, the high initial investment involved in the global indoor farming market may act as a huge restraining factor for the market growth.
Integration of Advanced Technologies in Indoor Farming Practices is Driving the Market Growth
The integration of advanced technologies is one of the major components of indoor farming to function. Indoor farming deploys multiple technologies including the Internet of Things (IoT), artificial intelligence, big data analytics, robotics, etc., to create a specific environment that the plant or crop needs to grow. These technologies are also used to monitor, test, review and improve predictive analysis through the collection of data by IoT sensors and provide necessary changes to boost production and quality of the output.
Global Indoor Farming Market – By Component
Based on components, the global indoor farming market is segmented into hardware and software & services. The hardware segment holds the largest market share. This segment is further classified into irrigation systems, climate control systems, sensors, lighting systems, communication systems, system controls, and others. These components play a crucial factor in providing the accurate environment for the plants to grow according to their needs, which is driving its overall market growth.
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Global Indoor Farming Market – By Crop Type
Based on crop type, the global indoor farming market is segmented into fruits & vegetables, herbs & microgreens, flowers & ornamentals, and others. The fruits & vegetable segment accounts for the largest market share. The companies are significantly focusing on producing fruits and vegetables, among which tomato leafy greens, chili peppers, etc., are emerging as the most popular choice to generate maximum profit. The flowers and ornamentals segment also covers a substantial market share.
Global Indoor Farming Market – Regional Insights
Geographically, the global indoor farming market is segmented into North America, Europe, Asia-Pacific, Latin America, Middle-East & Africa. Europe dominates the global indoor farming market owing to the high penetration and investment towards high-end technologies such as Controlled Environment Agriculture, sensors, use of LEDs for lightening, etc. Furthermore, favorable government initiatives such as subsidies to the indoor farming components and infrastructures also play a crucial role in propelling the growth of the market in the European regions.
Impact of COVID-19 on Global Indoor Farming Market
The unprecedented COVID-19 outbreak brought tremendous growth opportunities for the global indoor farming market. Although the market was negatively impacted by the pandemic during the initial period since the infrastructure development for indoor farming was halted and the supply of hardware components was hindered. However, the increasing health consciousness among consumers along with declining dependence of imported food items by the countries post the import-export restrictions globally is offering lucrative growth opportunities to the global indoor farming market.
The leading market players of the global indoor farming market are AeroFarms, Sky Greens, BrightFarms Inc., Green Sense Farms LLC, BrightFarms Inc., Village Farms International Inc., Bowery Inc., Garden Fresh Farms, FreshBox Farms, Metropolis Farms Inc., Everlight Electronics, Argus Control Systems, Grobo, Signify Holding, VitaLink, Hydrodynamics International, Emerald Harvest, Advanced Nutrients, General Hydroponics, Hydroponics System International, Heliospectra AB, Vertical Farm Systems, Richel Group, and other prominent players.
The global indoor farming market is fragmented with the presence of several regional companies and startups. The market is still emerging due to which it is welcoming towards new entrants. The companies are significantly focusing on market expansion by investing in the establishment of greenhouses and other infrastructure. Furthermore, the adoption of competitive strategies such as partnerships, mergers, acquisitions, collaborations, etc., is also prominent in this market.
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