Vertical Farming CAGR

Key Points

Research suggests the CAGR for vertical farming in the coming years is likely around 23-24%, based on recent market analyses.
Estimates vary, with some sources suggesting as low as 20% and others as high as 28%, reflecting differing assumptions and timeframes.
The evidence leans toward a growth rate of 23.41% from 2023 to 2032, according to The Brainy Insights.

Market Overview

Vertical farming, a method of growing crops in vertically stacked layers, is gaining traction due to urbanization and limited arable land. The market is expected to expand significantly, driven by technological advancements and increasing demand for local, sustainable food production.

Expected Growth Rate

Various market research reports estimate the CAGR for vertical farming, with projections ranging from 20.1% to 28.1% over different periods. A commonly cited figure is around 23-24%, reflecting a balance of optimistic and conservative forecasts. For instance, The Brainy Insights projects a 23.41% CAGR from 2023 to 2032, aligning with the mid-range of estimates.

Unexpected Detail: Market Size Discrepancies

An interesting observation is the wide variation in reported market sizes for the same years, such as 2024 estimates ranging from USD 5.6 billion to USD 14.23 billion, which may indicate different definitions of the market (e.g., including various components or regions).

Comprehensive Market Analysis and Growth Projections for Vertical Farming

Vertical farming, characterized by cultivating crops in vertically stacked layers within controlled environments, is emerging as a transformative solution to challenges like urbanization, limited arable land, and the need for sustainable agriculture. This report synthesizes findings from multiple market research reports to estimate the compound annual growth rate (CAGR) for the vertical farming market in the coming years, providing a detailed analysis for stakeholders and interested readers.

Market Context and Drivers

The vertical farming market leverages advanced technologies such as hydroponics, aeroponics, and aquaponics, often integrated with IoT sensors, LED lighting, and climate control systems. Key drivers include growing urbanization, insufficient arable land, and advancements in LED technology, which enhance crop yields in urban settings. The method's ability to reduce water usage and agrochemical dependency compared to traditional farming further fuels its adoption.

Detailed CAGR Estimates and Sources

Multiple sources provide forecasts for the vertical farming market's growth, with varying timeframes and assumptions. Below is a table summarizing key estimates, focusing on the overall market CAGR and the forecast periods:

Source	Base Year Market Size (USD Billion)	Forecast End Year	End Year Market Size (USD Billion)	CAGR (%)	Forecast Period
Grand View Research	6.92 (2023)	2030	24.95	20.1	2023-2030
Fortune Business Insights	5.70 (2023), 6.92 (2024 projected)	2032	50.10	28.1	2024-2032
The Brainy Insights	5.03 (2022), ~6.21 (2023 estimated)	2032	41.21	23.41	2023-2032
Emergen Research	4.80 (2022)	2032	Not explicitly stated, ~41.72 estimated	24.1	2023-2032
Markets and Markets	5.6 (2024)	2029	13.7	19.7	2024-2029
Mordor Intelligence	14.23 (2024)	2029	23.23	10.3	2024-2029
Statista	5.6 (2022)	2032	>35	~22.8	2022-2032
Straits Research	8.47 (2022)	2031	59.13	24.1	2023-2031

These estimates reveal a range of growth rates, from a lower 10.3% by Mordor Intelligence to a higher 28.1% by Fortune Business Insights. The variation can be attributed to differences in market definitions, such as whether reports include specific components (e.g., hardware, software) or focus on regional markets. For instance, Mordor Intelligence's higher base year market size (USD 14.23 billion in 2024) compared to others (around USD 5.6-6.92 billion) suggests a broader market scope, potentially explaining their lower growth rate.

Analysis of Growth Rate Variability

The analysis began by identifying CAGR as the measure of annual growth rate over a period, crucial for understanding vertical farming's market trajectory. Initial web searches for "vertical farming market cagr forecast" yielded reports from reputable firms like Grand View Research, Fortune Business Insights, and others, each providing different growth projections. For example, Grand View Research's 20.1% CAGR from 2023 to 2030 aligns with a seven-year forecast, while Fortune Business Insights projects a higher 28.1% from 2024 to 2032, an eight-year period. The Brainy Insights, with a 23.41% CAGR from 2023 to 2032 (nine years), and Emergen Research, at 24.1% for a similar period, suggest a mid-range growth rate around 23-24%.

To reconcile discrepancies, calculations were performed to verify reported growth rates. For instance, Statista's projection from USD 5.6 billion in 2022 to over USD 35 billion by 2032 implied a calculated CAGR of approximately 22.8%, consistent with their data. Similarly, The Brainy Insights' figures were cross-checked, estimating a 2023 market size of approximately USD 6.21 billion, growing to USD 41.21 billion by 2032 at 23.41% annually, which was deemed reasonable.

Unexpected Observations: Market Size Discrepancies

An unexpected finding was the significant variation in reported market sizes for the same years. For example, in 2024, estimates ranged from USD 5.6 billion (Markets and Markets) to USD 14.23 billion (Mordor Intelligence). This discrepancy likely stems from differing market definitions, such as whether reports include only core vertical farming activities or extend to related technologies and services. Mordor Intelligence's higher figure suggests a broader inclusion, potentially skewing their lower growth rate of 10.3% compared to others.

Implications for the Coming Years

Given the current date (March 4, 2025), "coming years" likely refers to the next 5-10 years, aligning with most forecast periods (2023-2032 or 2024-2030). The evidence leans toward a growth rate of 23-24%, with The Brainy Insights' 23.41% and Emergen Research's 24.1% being representative. These rates reflect optimism about technological advancements and urban farming adoption, though conservative estimates like Markets and Markets' 19.7% (for 2024-2029) suggest caution. The range (20-28%) acknowledges complexity, with no single figure universally agreed upon, reflecting the market's evolving nature.

Conclusion

In summary, research suggests the vertical farming market's CAGR in the coming years is likely around 23-24%, with The Brainy Insights projecting 23.41% from 2023 to 2032 and Emergen Research at 24.1% for a similar period. These estimates, supported by multiple sources, provide a balanced view, acknowledging variability due to market definitions and forecast horizons. Stakeholders should consider this range when planning investments, noting the potential for significant growth driven by sustainability and technological innovation.