United States Vertical Farming Market to Grow at 24.6% CAGR Through 2031 | Leaders: AeroFarms, Plenty, Bowery, Green Spirit | Indoor Hydroponics Drives Sustainable Urban Agriculture

Market Overview

The Global Vertical Farming Market is projected to grow at a CAGR of 24.6% during the forecast period 2024-2031. With decreasing arable land and the depletion of natural resources, agricultural communities are increasingly turning to efficient and sustainable farming practices that adhere to the 'law of minimum.' Vertical farming has emerged as a solution to address these challenges by enabling high-yield crop production using minimal land and resources.

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Vertical farming involves the controlled cultivation of plants in vertically stacked layers, using setups such as controlled-environment buildings, repurposed warehouses, growth chambers, and shipping containers. Key advantages include reduced agricultural runoff, optimized energy consumption, lower overheads, and minimized labor costs. Advanced irrigation systems, LED lighting, and climate control technologies allow year-round crop production, making vertical farming a viable and sustainable alternative to traditional agriculture.

Recent Developments:

✅ January 2026 - United States: AeroFarms expanded its vertical farming operations with a new indoor farm in New Jersey, integrating advanced LED lighting and hydroponic systems to boost year-round leafy green production.

✅ November 2025 - Japan: Spread Co., Ltd. introduced fully automated vertical farming modules for lettuce and leafy greens, combining AI-based growth monitoring with precision nutrient delivery.

✅ September 2025 - Singapore: Sky Greens launched a pilot vertical farm using solar-powered rotating towers, reducing energy consumption while increasing crop yield efficiency.

✅ August 2025 - Netherlands: PlantLab unveiled a climate-optimized vertical farm for herbs and vegetables, incorporating LED spectrum adjustments to accelerate plant growth and reduce water usage.

✅ June 2025 - China: Plenty China initiated a smart vertical farming facility in Shanghai, integrating IoT-based monitoring and AI-driven nutrient management for improved crop quality.

✅ April 2025 - Australia: Urban Crop Solutions introduced modular vertical farming units for urban areas, enabling scalable production of leafy greens and microgreens with minimal labor input.

Mergers & Acquisitions:

✅ January 2026 - United States: Bowery Farming acquired a smaller indoor farming startup specializing in automated vertical hydroponic solutions, expanding its urban farming footprint.

✅ October 2025 - Germany: Infarm completed the acquisition of a vertical farming technology provider to strengthen its modular urban farming solutions across Europe.

✅ August 2025 - Japan: Spread Co., Ltd. partnered with a local agri-tech firm to co-develop AI-integrated vertical farming systems for leafy greens and herbs.

✅ July 2025 - Singapore: Sky Greens collaborated with a technology startup to enhance its rotating tower system with IoT-enabled crop monitoring for improved yield.

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Key Players:

AeroFarms LLC - 30%
A pioneer in vertical farming technology, AeroFarms specializes in indoor aeroponic systems with advanced LED lighting and nutrient delivery, enabling high-yield, sustainable production of leafy greens.

Plenty Unlimited Inc - 25%
Focuses on AI-driven vertical farms, integrating smart monitoring and precision agriculture technologies to optimize crop growth and maximize productivity year-round.

Green Spirit Farms LLC - 20%
Operates modular vertical farms for urban and commercial applications, emphasizing scalable production, energy efficiency, and minimal labor requirements.

Bowery Farming Inc - 25%
Leads in fully automated vertical farming solutions, combining robotics, IoT, and data-driven insights to enhance crop quality and reduce operational costs in urban environments.

Market Segmentation:

By Technique: Hydroponics leads the market with 45%, owing to its efficient water and nutrient usage and widespread adoption in leafy greens and vegetables. Aeroponics accounts for 35%, driven by precision nutrient delivery and faster plant growth rates, particularly in high-tech indoor farms. Aquaponics contributes 20%, combining fish farming with plant cultivation for sustainable, integrated food production.

By Type: Indoor Farming dominates the market with 70%, supported by controlled environments, year-round production, and advanced climate and lighting technologies. Outdoor Vertical Farming holds 30%, mainly in urban farms using modular stacked systems to maximize land use.

By Distribution Channel: Fruits & Vegetables represent 60%, the largest share due to high consumer demand for fresh, locally produced greens. Flowers account for 15%, driven by ornamental plant cultivation in controlled environments. Medicinal Plants hold 15%, reflecting growing interest in plant-based therapeutics. Spices contribute 10%, supported by high-value specialty crops grown in vertical setups for urban markets.

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Regional Insights:

North America - 35%
The region leads the market due to early adoption of advanced indoor farming technologies, strong R&D in vertical farming systems, and growing urban agriculture initiatives in the U.S. and Canada.

Europe - 25%
Driven by high investment in sustainable farming, government incentives, and technological innovation in countries such as the Netherlands, Germany, and the U.K., Europe holds a significant share in vertical farming adoption.

Asia-Pacific - 30%
The fastest-growing region, led by Japan, China, and Singapore, where limited arable land and rapid urbanization are driving investment in smart vertical farming solutions and high-tech controlled-environment agriculture.

Market Dynamics:

Driver:
The growth of the Vertical Farming Market is primarily driven by the increasing demand for precision and sustainable farming amid declining arable land and depleting natural resources. With the global population rising, the need for food is expanding rapidly, but factors such as urbanization, soil erosion, and over-cultivation are reducing cultivable land. Vertical farming offers an effective alternative to traditional agriculture by providing high-yield crops with minimal inputs, consuming up to 90% less water and generating lower CO2 emissions compared with conventional farming.

The method's efficiency, coupled with minimal food transportation and higher local yields, is encouraging adoption among farmers focused on sustainable practices. Additionally, growing consumer demand for organic and pesticide-free produce aligns with vertical farming practices, which restrict the use of synthetic pesticides, growth hormones, and antibiotics. According to the Organic Industry Survey by the Organic Trade Association in May 2018, U.S. organic food sales increased from USD 45.2 billion in 2017 to USD 47.9 billion in 2018, reflecting the rising consumer preference for organic produce. Furthermore, advancements in IoT, AI, and Big Data are enhancing vertical farming efficiency by enabling precise monitoring and management of plant growth.

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