The market for indoor farming technology market – estimated at USD 14.5 billion in 2020 – is projected to grow at a CAGR of 9.4% to reach USD 24.8 billion by 2026.
This estimate was published in a report by MarketsandMarkets, titled “Indoor Farming Technology Market by Growing System (Hydroponics, Aeroponics, Aquaponics, Soil-based, Hybrid), Facility Type, Component, Crop Type (Fruits & Vegetables, Herbs & Microgreens, Flowers & Ornamentals), and Region – Global Forecast to 2026”.
The study has also taken into account the impact of COVID-19 on the market.
“The pressure on the agriculture industry to meet the growing demand for grains and food leads to the search for high-yielding farming techniques, such as precision farming and urban farming,” it has noted.
Thus, indoor farming is looked upon as a potential solution for the growing concern about food security in the coming years.
The adoption rate of urban indoor farming systems around the world is estimated to rise sharply following the coronavirus pandemic, the report stated.
The agriculture industry faced several challenges. Due to labour shortages, some farmers missed their window of opportunity for harvesting for seasonal crops, the falling prices of agricultural products and the disruption of logistics.
Many countries also realized their over dependence on imports of food materials and hence began emphasizing on internal and domestic productions.
One of the main advantages of indoor farming is its higher yield compared to conventional farming methods. Indoor farming creates optimum growing conditions for farmers to grow a crop from seed to the harvesting stages in lesser time and obtain higher yields in each cycle with limited land area.
According to USDA data, in 2016, the average yield of tomatoes grown in greenhouse hydroponics was 10.59 pounds per square foot, and that of traditionally grown tomatoes was 1.85 pounds per square foot. Therefore, indoor farms can increase the overall crop yield by stacking additional layers and increasing the growing area.
Indoor farming addresses the concern of limited space, as certain plants can be grown in smaller areas. Indoor farms recirculate and reuse the water; an average of 95% less water is required to grow the same crops as compared to outdoor farming.
When plants or crops are grown in vertical greenhouses, the transpiration process occurs, which makes it feasible for farmers to reuse the water for irrigation purposes.
However, the initial cost for setting up indoor farming is more compared to that in traditional farming. Cost of urban land is higher than that of farmland. Furthermore, energy accounts for a higher percentage of operating costs for both vertical farms and greenhouses.
Controlling the ambient environment – with proper lighting, temperature, pollination – and the arrangement of plants are important for an ideal indoor farm. All these incur high financial inputs.
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