Vertical Farming Market | Global Market Analysis Report – 2035 – Fact.MR

Vertical Farming Market Report: An Analysis of Growth, Innovation, and Alignment with Sustainable Development Goals (2025-2035)

Executive Summary

The global vertical farming market is poised for substantial growth, projected to expand from USD 9.66 billion in 2025 to USD 74.35 billion by 2035, at a Compound Annual Growth Rate (CAGR) of 22.6%. This expansion is intrinsically linked to the pursuit of the United Nations Sustainable Development Goals (SDGs). By localizing food production, enhancing resource efficiency, and leveraging technological innovation, vertical farming offers a transformative approach to addressing global challenges related to food security, urban sustainability, and responsible consumption. This report analyzes the market’s trajectory, key segments, and regional dynamics through the lens of its contribution to the 2030 Agenda for Sustainable Development.

Market Forecast (2025-2035): A Pathway to Sustainable Food Systems

Projected Growth and Contribution to SDG 2 (Zero Hunger)

The market’s projected 669.8% total growth over the decade underscores its increasing role in establishing resilient and secure food systems. This rapid adoption directly supports SDG 2 (Zero Hunger) by enabling stable, year-round crop production independent of climate variability and land availability. The forecast indicates two distinct growth phases:

• 2025–2030: The market is expected to grow from USD 9.66 billion to USD 27.33 billion. This initial phase will be driven by the urgent need to feed expanding urban populations and reduce dependency on traditional agriculture, a key target for ensuring food security.
• 2030–2035: A significant acceleration is anticipated, with the market expanding from USD 27.33 billion to USD 74.35 billion. This growth will be fueled by advanced technologies that optimize yield and operational sustainability, further strengthening the sector’s capacity to contribute to global food supplies.

Key Market Statistics

• Market Value (2025): USD 9.66 billion
• Forecast Market Value (2035): USD 74.35 billion
• Forecast CAGR (2025-2035): 22.6%
• Dominant Component: Hardware (61.5% share)
• Dominant Growing Mechanism: Hydroponics (68.7% share)
• Primary Growth Regions: Asia Pacific, North America, Europe

Drivers of Market Growth: Aligning with Global Sustainability Agendas

SDG 11: Sustainable Cities and Communities

Urbanization is a primary driver of the vertical farming market. By integrating food production into urban environments, vertical farms help create self-sufficient and resilient cities, directly aligning with SDG 11. This model reduces food miles, lowers transportation-related emissions, and provides urban populations with access to fresh, nutritious produce, enhancing urban food security.

SDG 12: Responsible Consumption and Production

Vertical farming embodies the principles of SDG 12 by promoting resource efficiency. Controlled-Environment Agriculture (CEA) systems significantly reduce water and land usage compared to conventional farming. The use of hydroponic and aeroponic systems minimizes water waste, while the vertical stacking of crops maximizes output per square meter, decoupling food production from land degradation.

SDG 9: Industry, Innovation, and Infrastructure

Technological advancement is the cornerstone of the market’s growth and its contribution to SDG 9. Innovations in automation, AI, IoT, and LED lighting are making vertical farms more efficient and economically viable. These technologies represent a new frontier in agricultural infrastructure, fostering a high-tech industry focused on sustainable solutions.

Segmental Analysis: Technology’s Role in Achieving Sustainability

Hardware Component Analysis: Building Resilient Infrastructure

The hardware segment, commanding a 61.5% market share, forms the physical infrastructure of this sustainable agricultural model. Key components include:

1. Lighting Systems: Accounting for 35.2% of hardware revenue, advanced LED systems are critical for optimizing plant growth while minimizing energy consumption. This innovation is crucial for making vertical farming a more sustainable practice, addressing one of its key operational challenges.
2. Climate Control Systems: Automated systems for managing temperature, humidity, and CO2 levels ensure optimal growing conditions, maximizing yield and resource efficiency in line with SDG 12.

Growing Mechanism Analysis: Hydroponics and Water Conservation

The hydroponics segment holds a dominant 68.7% market share, primarily due to its exceptional water efficiency. By delivering nutrient-rich water directly to plant roots in a closed-loop system, hydroponics can use up to 90% less water than traditional agriculture. This directly supports SDG 6 (Clean Water and Sanitation) by conserving freshwater resources. The Nutrient Film Technique (NFT), a key subsegment, is particularly effective in urban settings where space and water are limited.

Regional Market Analysis: Localizing the Sustainable Development Goals

Asia Pacific: Addressing Food Security and Urbanization

The Asia Pacific region, led by China (25.8% CAGR) and India (26.4% CAGR), is a key growth area. Here, vertical farming is being adopted as a strategic tool to ensure food self-sufficiency for rapidly growing urban populations. Government initiatives promoting smart cities and sustainable agriculture are accelerating market expansion, directly addressing SDG 2 and SDG 11.

North America and Europe: Shortening Supply Chains for Sustainable Consumption

In North America (USA: 20.5% CAGR) and Europe (Germany: 20.2% CAGR), market growth is driven by consumer demand for local, fresh produce and the integration of vertical farms into retail supply chains. This trend supports SDG 12 by reducing food waste, minimizing transportation emissions, and enhancing transparency in the food system.

Key Country Growth Projections (CAGR 2025-2035)

• India: 26.4%
• China: 25.8%
• Brazil: 22.9%
• USA: 20.5%
• Germany: 20.2%

Competitive Landscape: Innovating for a Sustainable Future

The competitive landscape is led by technology-focused companies committed to advancing sustainable agriculture. Key players are differentiating themselves through innovation in automation, energy efficiency, and data analytics to optimize production and reduce environmental impact.

• Intelligent Growth Solutions (IGS): A market leader with an 11.6% share, focusing on automated, energy-efficient, closed-loop systems.
• Signify Holding: Specializes in horticultural LED lighting, a critical component for enhancing energy efficiency and crop yields.
• iFarm: Utilizes AI-based technologies to optimize farm management and yield forecasting, contributing to data-driven sustainable production.
• Freight Farms Inc.: A pioneer in modular, container-based farming, enabling decentralized food production in any location.
• Argus Control Systems: Focuses on climate automation technologies to maximize resource efficiency in CEA facilities.

Conclusion: Vertical Farming as a Catalyst for the 2030 Agenda

The vertical farming market is more than a high-growth industry; it is a critical enabler of the Sustainable Development Goals. By fundamentally rethinking agricultural production for an urbanized world, it provides a scalable solution to enhance food security (SDG 2), build sustainable cities (SDG 11), and promote responsible production patterns (SDG 12). While challenges such as high initial costs and energy consumption remain, ongoing innovation (SDG 9) is steadily mitigating these constraints. Through 2035, vertical farming will become an indispensable pillar of a global food system that is resilient, resource-efficient, and aligned with the principles of sustainable development.

Analysis of Sustainable Development Goals in the Vertical Farming Market

1. Which SDGs are addressed or connected to the issues highlighted in the article?

• SDG 2: Zero Hunger

  The article directly addresses food security and production. It highlights vertical farming’s role in meeting “rising food demand in urban environments,” ensuring a “stable food supply,” and promoting “food self-sufficiency.” This aligns with the goal of ending hunger and ensuring access to sufficient food.

• SDG 6: Clean Water and Sanitation

  The article emphasizes water efficiency as a key benefit of vertical farming. It mentions that technologies like “hydroponics,” “aquaponics,” and “aeroponics” will “improve water use efficiency.” The dominance of hydroponics, which is known for its reduced water consumption compared to traditional agriculture, connects directly to sustainable water management.

• SDG 7: Affordable and Clean Energy

  The article discusses the challenge of “energy consumption from artificial lighting” in vertical farms. It also points to solutions such as “ongoing improvements in LED efficiency” and “renewable power integration,” which are central to achieving sustainable energy goals.

• SDG 9: Industry, Innovation, and Infrastructure

  The core of the article focuses on technological innovation in agriculture. It describes the “convergence of automation, artificial intelligence, and data-driven farming systems,” investment in “automated climate control,” and the expansion of “agricultural infrastructure.” This reflects the goal of building resilient infrastructure and fostering innovation.

• SDG 11: Sustainable Cities and Communities

  Vertical farming is presented as a solution for urban areas. The article notes its growth is driven by “expanding urban populations” and its integration “within supermarkets, restaurants, and distribution networks” in cities. This supports the goal of making cities more sustainable and resilient by localizing food production.

• SDG 12: Responsible Consumption and Production

  The article highlights the “increasing emphasis on resource efficiency” and “minimizing resource input.” It frames vertical farming as a pillar of “sustainable food production” that aligns with “circular economy goals” by reducing land dependency and optimizing resource use, which is central to this SDG.

• SDG 13: Climate Action

  The article links vertical farming to climate resilience. It states that these systems help ensure a “stable food supply amid climate variability” and that their evolution aligns with “climate resilience” goals, contributing to adaptive capacity in the face of climate change.

2. What specific targets under those SDGs can be identified based on the article’s content?

1. SDG 2: Zero Hunger

   • Target 2.4: By 2030, ensure sustainable food production systems and implement resilient agricultural practices that increase productivity and production, that help maintain ecosystems, that strengthen capacity for adaptation to climate change, extreme weather, drought, flooding and other disasters and that progressively improve land and soil quality.
     
     Explanation: The article describes vertical farming as a “resilient” practice that ensures a “stable food supply amid climate variability.” It focuses on enhancing “productivity per square meter” and “yield efficiency” while reducing “land dependency,” directly contributing to this target.

2. SDG 6: Clean Water and Sanitation

   • Target 6.4: By 2030, substantially increase water-use efficiency across all sectors and ensure sustainable withdrawals and supply of freshwater to address water scarcity.
     
     Explanation: The article highlights that hydroponics, the dominant growing mechanism, offers “water efficiency benefits.” It also mentions the shift toward “hybrid systems combining aquaponics and aeroponics” to further “improve water use efficiency.”

3. SDG 7: Affordable and Clean Energy

   • Target 7.3: By 2030, double the global rate of improvement in energy efficiency.
     
     Explanation: The article identifies high energy consumption as a challenge but points to “ongoing improvements in LED efficiency” and the growth of the lighting systems segment driven by “energy-efficient LEDs” as key trends, aligning with the goal of improving energy efficiency.

4. SDG 9: Industry, Innovation, and Infrastructure

   • Target 9.4: By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes.
     
     Explanation: The article is centered on the adoption of advanced technologies like “automation, artificial intelligence, and IoT technologies” to create “resource-efficient food systems.” This represents a technological upgrade of the agricultural industry to make it more sustainable.

5. SDG 11: Sustainable Cities and Communities

   • Target 11.a: Support positive economic, social and environmental links between urban, peri-urban and rural areas by strengthening national and regional development planning.
     
     Explanation: The article describes the “integration of vertical farms within supermarkets, restaurants, and distribution networks” in urban centers and the expansion of “urban agriculture.” This strengthens urban food systems and creates new links in regional food supply chains.

6. SDG 12: Responsible Consumption and Production

   • Target 12.2: By 2030, achieve the sustainable management and efficient use of natural resources.
     
     Explanation: The article emphasizes that vertical farming is a key part of the “global transition toward localized, technology-enabled, and resource-efficient food systems.” It mentions “minimizing resource input” and reducing “land dependency” as primary drivers.

7. SDG 13: Climate Action

   • Target 13.1: Strengthen resilience and adaptive capacity to climate-related hazards and natural disasters in all countries.
     
     Explanation: The article positions vertical farming as a method to ensure a “stable food supply amid climate variability” and aligns its growth with achieving “climate resilience” goals, thus enhancing adaptive capacity in the food sector.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

1. Indicators for SDG 2 (Target 2.4)

   • Market Growth: The projected growth of the vertical farming market from USD 9.66 billion in 2025 to USD 74.35 billion by 2035 indicates a significant expansion of this resilient agricultural practice.
   • Productivity Improvements: The article implies progress through mentions of enhancing “productivity per square meter” and improving “yield efficiency” via technology.

2. Indicators for SDG 6 (Target 6.4) & SDG 12 (Target 12.2)

   • Adoption of Water-Efficient Technologies: The market dominance of hydroponics (projected 68.7% share in 2025) and the development of aquaponics and aeroponics serve as direct indicators of increased water-use efficiency in the sector.
   • Resource Efficiency Focus: The article’s repeated emphasis on “resource efficiency,” “reduced resource consumption,” and “minimizing resource input” as key market drivers indicates a shift towards sustainable resource management.

3. Indicators for SDG 7 (Target 7.3)

   • Investment in Efficient Lighting: The growth of the lighting systems subsegment (projected to generate USD 3.4 billion in 2025) driven by “energy-efficient LEDs” is a clear indicator of progress in energy efficiency.
   • Technological Advancement: Mention of “ongoing improvements in LED efficiency” points to continuous progress in this area.

4. Indicators for SDG 9 (Target 9.4)

   • Technology Adoption Rate: The high market share of the hardware segment (61.5%) and the integration of “automation, artificial intelligence, and IoT technologies” quantify the adoption of innovative and sustainable industrial processes in agriculture.
   • Investment in R&D: The article mentions companies investing in “sophisticated vertical farming technologies” and “automated agricultural processes” as a means to gain competitive advantage.

5. Indicators for SDG 11 (Target 11.a)

   • Growth in Urban Markets: High CAGR in countries with rapid urbanization like India (26.4%) and China (25.8%) and the focus on “urban fresh food retail” in the UK show the expansion of urban agriculture.
   • Integration into Urban Infrastructure: The mention of vertical farms being integrated “within supermarkets, restaurants, and distribution networks” serves as a qualitative indicator of strengthening urban-regional food links.

6. Indicators for SDG 13 (Target 13.1)

   • Market Expansion as a Resilience Strategy: The overall market growth (22.6% CAGR) can be interpreted as an investment in strengthening the food system’s resilience against “climate variability.”

4. Table of SDGs, Targets, and Indicators

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