Indoor Farming Market Is Set To Reach Staggering Valuation Of US$ 80.59 Billion By 2033 Astute Analytica

(MENAFN- GlobeNewsWire - Nasdaq) Technological innovation in LED lighting and hydroponics accelerating the indoor farming market's growth, primarily for high-turnover crops. However, steep initial capital outlay and intense energy consumption create a significant profitability bottleneck, challenging its path to mainstream scale.

Chicago, Aug. 06, 2025 (GLOBE NEWSWIRE) -- The global indoor farming market was valued at US$ 33.90 billion in 2024 and is expected to reach US$ 80.59 billion by 2033, at a CAGR of 10.1% during the forecast period 2025-2033.

The global market is currently undergoing a period of explosive growth and transformative change, solidifying its position as a critical component of the future of agriculture. Propelled by a convergence of technological innovation, escalating consumer demand for sustainable and locally sourced food, and an urgent need for global food security, the sector is attracting significant investment and expanding at an unprecedented rate. From sprawling new smart farms to sophisticated AI-driven automation, the industry is redefining the limits of food production. This evolution is not merely theoretical; it is quantified by the rapid scaling of operations, diversification of high-value crops, and increasing penetration into mainstream retail channels.

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As companies refine their economic models and overcome operational hurdles, the indoor farming market is demonstrating its immense potential to create a more resilient, efficient, and sustainable global food system. The data from 2024 and forward-looking projections for 2025 paint a clear picture of a market that is not just growing, but fundamentally reshaping how food is grown and distributed around the world, offering compelling opportunities for stakeholders prepared to embrace this agricultural revolution.

Key Findings in Indoor Farming Market

Market Forecast (2033)	US$ 80.59 billion
CAGR	10.1%
Largest Region (2024)	Europe (35.40%)
By Growing Systems	Hydroponics (46.40%)
By Crop Type	Common Crops (51.20%)
By Technology	Lighting (42.10%)
Top Drivers	Rising consumer demand for fresh, local, pesticide-free produce. Climate change and shrinking arable land drive food security needs. Technological advances in AI and LED lighting reduce costs.
Top Trends	Automation and robotics are reducing operational labor costs. Expansion beyond leafy greens to higher-value fruiting crops. Increasing focus on sustainable and eco-friendly farming practices.
Top Challenges	Volatile and high energy consumption costs remain a barrier. Regulatory hurdles and need for supportive government policies.

Monumental Facility Expansions Are Redefining Operational Scale and Production

A clear indicator of the indoor farming market's vitality is the aggressive expansion of its physical footprint. Companies are scaling up their facilities at a remarkable pace to meet burgeoning demand. For instance, the vertical farming company Oishii opened a massive 237,500-square-foot smart farm in Phillipsburg, New Jersey, in June 2024, a facility that complements its existing 72,000-square-foot farm in Jersey City. This new Phillipsburg facility alone has the capacity to increase the company's total output by an astounding factor of 20. This trend is global, with Dutch company Growy launching a new 8,000m2 vertical farm in Singapore in 2024. In the United States, Cox Enterprises' agricultural division, Cox Farms, cemented its leadership position by becoming the largest greenhouse operator in 2024, now managing over 700 acres of controlled-environment facilities.

Similarly, major player Gotham Greens achieved an annual production capacity of approximately 100 million heads of lettuce in 2024. The Middle East is also a key growth region, evidenced by a joint venture in Saudi Arabia with AeroFarms to construct a farm with a projected annual production capacity of 1.1 million kilograms of crops. Further highlighting this trend, Plenty opened a new facility in Richmond, Virginia, in 2024, which is set to become the world's largest vertical farm dedicated solely to producing strawberries.

Strategic Investment and Corporate Finance Fueling Next-Generation Industry Growth

Significant capital continues to flow into the indoor farming market, although investors are becoming more discerning, prioritizing companies with proven economic models and a clear path to profitability. In a testament to this, vertical farming company Oishii secured an additional $16 million from investors in a 2024 funding round, bringing its total Series B funding to a close of $150 million for the year. Across the entire industry, a substantial $475 million was invested across 74 separate deals during 2024. Public financing is also playing a role; 80 Acres Farms announced it would receive $140 million in public bonds from Boone County, Kentucky, in 2024 to fund facility expansion.

Looking ahead, Italy's Planet Farms has announced a significant joint venture valued at 200 million euros for 2025. The market is also experiencing a phase of consolidation aimed at strengthening technological capabilities. In a strategic move, XYZ Robotics acquired GrowBot Solutions in January 2024, and just two months later, Plenty Unlimited merged with AgriBot Technologies in March 2024 to enhance its robotic systems.

Advanced Automation and AI Revolutionize Efficiency and Crop Management

Technology, particularly automation and artificial intelligence, remains the engine driving the indoor farming market's quest for ultimate efficiency and scalability. German startup vGreens exemplifies this, utilizing AI-controlled software that allows for strawberry production at the mere touch of a button. The company is pushing the boundaries further, with its new Singapore subsidiary, launching in late 2024, set to focus on developing AI-driven automated tissue cultures. Robotic systems are becoming standard for precise planting of seeds and seedlings in various bed configurations. Furthermore, advanced vision-guided robots are now being deployed to continuously monitor crop growth and health in real-time.

These sophisticated vision systems also empower robots to identify and precisely prune overgrown areas, which is crucial for optimizing overall plant health. Strategic partnerships are accelerating this technological integration; in February 2024, IronOx partnered with HarvestAI to incorporate more advanced AI-driven robotics into its operational systems. The economic significance of this trend is underscored by the fact that the global market for robots specifically designed for vertical farming was valued at $2.2 billion in 2024.

Unlocking Superior Resource Efficiency and Sustainability in Modern Food Production

At the very core of the indoor farming value proposition is its remarkable ability to produce more with significantly fewer resources, a critical advantage in an era of environmental concern. Vertical farming techniques can use up to 10 times less water when compared to conventional farming methods, a staggering figure that highlights its sustainability credentials. Hydroponic systems, a cornerstone of the indoor farming market, are highly efficient, designed to recirculate and reuse water, minimizing waste. By operating within enclosed environments, water loss due to evaporation is drastically reduced compared to the exposure of open-field agriculture. This efficiency is further enhanced by advanced irrigation methods like drip systems and precision watering, which allow for the targeted delivery of water directly to plant roots.

The industry is not standing still; emerging technologies such as fogponics and aeroponics are currently being developed to minimize water consumption even further. On the energy front, a notable trend is the move by many operators to abandon combustion-based heating in favor of electrified systems like heat pumps, a clear step toward decarbonizing their operations.

Maximizing Crop Yields and Diversifying Portfolios for Enhanced Market Economics

The powerful combination of controlled environments and cutting-edge technology is leading to astounding yields and an ever-expanding variety of commercially viable crops. Year-round cultivation within vertical farms in the Indoor farming market can result in crop yields that are an incredible 240 times higher than traditional agriculture when measured on a comparable land footprint. This productivity allows for greater crop diversity. The Growy farm in Singapore, for example, produces 34 different products, including sought-after microgreens like amaranth and shiso. This includes a specially curated "Singapore Salad Mix" that features local favorites such as Bok Choy and Naibai. Oishii, initially famous for its premium strawberries, has successfully expanded its offerings to include the Rubī tomato.

The company's innovation pipeline is active, as it is also developing new varietals, including the "Nikko Berry". Importantly, increased production efficiency is translating into consumer benefits. The price of Oishii's Omakase Berries plummeted from $50 per tray in 2018 to as low as $12 in 2024, and the price for a tray of its Koyo Berries was reduced to just $9.99 in 2024. High-value crops like strawberries are a key economic driver, capable of commanding premium pricing that is 2 to 5 times higher than other produce categories.

Mapping the Dynamic Geographic Landscape and Key Regional Growth Hubs

While North America continues to be a dominant force, the indoor farming market is witnessing significant growth and investment in key international regions, particularly Asia and the Middle East. As of 2024, there are approximately 2,000 dedicated vertical farms operating in the United States. When all forms of indoor agriculture, including greenhouses, are considered, this number swells to about 52,000 facilities across the U.S. American companies are also looking abroad; Oishii is launching its first international facility in 2025 with a new R&D center in Tokyo, Japan.

vGreens, German startup in indoor farming market, is similarly expanding into Asia, opening a new subsidiary in Singapore in late 2024. Growy has ambitious plans to build another three to five farms globally, targeting markets in Europe, North America, and other parts of Asia. The United Arab Emirates has emerged as a key hub, with its government actively promoting vertical farming through substantial investments. However, the market is also undergoing a period of correction and consolidation. Plenty shut its Compton, California farm in 2024, and both Bowery Farming and Smallhold filed for bankruptcy in 2024, signaling intense market pressures.

Securing Prominent Retail Penetration and Dominance in Food Service Channels

Produce from indoor farms is rapidly transitioning from a niche product to a mainstream staple on retail shelves and restaurant menus. The new Growy farm in Singapore currently supplies its 34 distinct products to over 40 high-end hotels and restaurants in the city-state. The company has firm plans for a broader retail market entry in Singapore by the end of 2024.

In the United States indoor farming market, Oishii products became available in Harris Teeter grocery stores across the Washington, D.C. metropolitan area in 2024, a significant retail expansion. Oishii also rolled out its produce to stores under the Wakefern brand in the tri-state area in 2024. Its premium berries are now prominently featured on the menus of Michelin-starred Chicago restaurants, including Esme and Omakase Yume, highlighting their appeal to the high-end culinary scene. In a testament to its scale, as of 2025, produce from Gotham Greens is available in retail locations across all 50 U.S. states, demonstrating true national reach.

Government Support and Strategic Grant Funding Catalyze Industry-Wide Innovation

Public funding and governmental support for urban and innovative agriculture are providing a significant and welcome boost to the indoor farming market's growth and development. In California, a 2024 proposition made $20 million in funding available specifically for urban agriculture projects. The state's Systems Builder grants offer individual awards that can range from $200,000 to $800,000, while its Urban Agriculture Practitioner Grants provide between $75,000 and $300,000 per project. At the federal level, the USDA's Urban Agriculture and Innovative Production (UAIP) grant program had a total of $7.5 million available for distribution in 2024.

The USDA also offers Community Food Projects grants of up to $400,000 for implementation projects. In October 2024, the USDA invested $9 million across 10 different organizations to specifically support urban agriculture initiatives. Support is also strong at the municipal level. The City of Seattle's Food Equity Fund provides approximately $2.3 million for local projects, with individual awards typically ranging from $25,000 to $100,000. Similarly, the city of Minneapolis offers grants for urban farming projects ranging from $5,000 to $25,000, and Washington D.C.'s government runs a program providing up to $10,000 per award for local urban farms.

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Analyzing Competitive Dynamics and Navigating Core Market Challenges for Success

While the growth is undeniable, the indoor farming market is a highly competitive arena with significant operational challenges that companies must navigate to achieve long-term success. The pace of expansion among leading players remains rapid, with greenhouse operator BrightFarms opening 3 new large-scale farms in the United States during 2024. Looking forward, the company vGreens announced ambitious plans to begin building its first industrial-scale plants in partnership with food retailers in 2025.

However, a market correction is evident in investment trends; since 2022, indoor farming companies have raised under $1 billion, a sharp decline from the nearly $8 billion raised between 2018 and 2022. A significant operational hurdle that persists is energy cost, which can represent a substantial 25% to 30% of a vertical farm's total operating expenditures. This, combined with high interest rates in 2024, has led to a notable trend towards improving existing facilities rather than embarking on new construction.

In fact, the year 2024 saw a marked increase in greenhouse projects over fully indoor vertical farms due to the high energy costs associated with the latter. The bankruptcy of major player Bowery Farming in 2024 starkly highlighted the financial challenges and capital-intensive nature of indoor farming market. Consequently, global investment has become more focused, with capital flowing toward fewer, better-positioned players like Oishii that have demonstrated clear operational discipline. Meanwhile, Oishii plans to launch its Open Innovation Center in Tokyo at the end of 2025 to spearhead R&D, and Growy already supplies produce to approximately 50 hotels and restaurants in Singapore.

Global Indoor Farming Market Major Players:

• AeroFarms
• AgriCool
• Argus Control Systems
• Bowery Farming
• BrightFarms
• Everlight Electronics
• EXDIN Solutions
• General Hydroponics
• Gotham Greens
• GP Solutions
• Heliospectra AB
• Infarm
• Iron Ox
• LumiGrow
• Signify Holding
• Sky Greens
• SPREAD Co., Ltd.
• Other Prominent Players

Key Market Segmentation:

By Growing System:

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

By Crop Type:

• Common crops
  • Lettuce
  • Chard
  • Cabbage
  • Kale
  • Tomatoes
  • Spinach
• Herbs
  • Basil
  • Mint
  • Chives
  • Parsley
• Microgreens

By Technology:

• Controlled Environment Agriculture
  • Dosing systems
  • Sterilization Systems
  • Chemical disinfection
• Lighting
  • Fluorescent grow lights
  • LED lighting
• Air control
  • CO2 gassing
  • Compressed CO2
• The Internet of Things - IoT
  • Sensors

By Region:

• North America
• Europe
• Asia Pacific
• Middle East & Africa (MEA)
• South America

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