Asia Pacific Indoor Farming Market Size (2024-2030)

The Asia Pacific Indoor Farming Market was valued at USD 11.50 Billion and is projected to reach a market size of USD 26.69 Billion by the end of 2030. The market is anticipated to expand at a compound annual growth rate (CAGR) of 12.78 % between 2024 and 2030.

The increased popularity of hydroponic and aeroponic crop cultivation methods, along with customer desire for chemical-free, organic food, is anticipated to drive the growth of the indoor farming market in Asia Pacific. Future developments in soil erosion prevention and crop productivity through the application of cutting-edge technologies like artificial intelligence and data analytics are anticipated to further expand the potential of indoor farming in the Asia-Pacific area. Rising consumer awareness of the benefits of eating high-quality, freshly produced food is anticipated to propel market expansion. Global population growth, particularly in developing nations like China and India, has increased food demand, which is predicted to fuel the indoor farming market's expansion in the upcoming years. However, the systems producing food and agriculture are impacted by climate changes causing pre-existing environmental issues including soil erosion and groundwater depletion. Governments support the construction of indoor farms in addition to other measures aimed at resolving this issue, which is anticipated to support market expansion. People believe that organic foods are safer, more nutrient-dense, healthier, and environmentally friendly. Consumer food buying behaviour significantly influences the demand for organic food, and suppliers, producers, and legislators must execute effective marketing tactics.

Key Market Insights:

The increasing shortage of arable land as a result of land degradation has encouraged farmers to look for creative ways to produce fresh food, which has led to the use of vertical farming techniques. By using stacked layers of potted seeds in multi-story buildings or warehouses, vertical farming allows crops to be grown indoors and is predicted to become a major market trend by 2030. This method avoids the restrictions caused by land limits while still optimising crop production per unit area. Artificial lighting is added to a variety of indoor farming techniques, including hydroponics and aquaponics, to provide the best possible growing environment. The growing business is confronted with obstacles, though, such as the high upfront cost of constructing indoor farms and limitations on the range of foods that can be raised. Notwithstanding these challenges, vertical farming will play a critical role in determining the direction of agriculture because of its ability to transform food production and solve urgent problems like land degradation and scarcity. Vertical farming has the potential to be a key component of providing sustainable food security for the world's expanding population as long as developments in technology and efficiency continue.

Asia Pacific Indoor Farming Market Drivers:

Fulfilling Customer Expectations for Asia Pacific's Indoor Farming Boom.

The Asia Pacific region's consumer preferences are changing significantly in favour of fresh, safe, and locally sourced goods, which is fueling the growing interest in indoor farming. This innovative method of farming enables year-round crop cultivation without the use of pesticides or herbicides, satisfying the demands of modern health-conscious consumers. Indoor farms can precisely control variables such as temperature, humidity, and illumination by utilising controlled environments. This allows for the provision of ideal conditions for plant growth while reducing the possibility of contamination. Furthermore, because indoor farms are close to cities, produce can be delivered quickly while maintaining its nutritional content and freshness. Indoor farming promotes sustainability by using resource-efficient technologies and vertical farming techniques to reduce water usage and land footprint and satisfy consumer needs for quality and safety. As a result, indoor farming has become an attractive option to satisfy the changing needs of customers in the Asia Pacific area. It not only solves sustainability issues in agriculture but also provides a dependable source of locally grown high-quality produce.

Indoor farming as a Sustainable Solution for Asia Pacific's Growing Populations: Overcoming Land Constraints.

The Asia Pacific region's growing population and limited arable land combine to highlight the critical need for creative solutions to meet food demands sustainably. A potential solution to this problem is indoor farming, which maximises food production in small areas. Indoor farms maximise land use efficiency by using vertical farming techniques and controlled settings. This allows crops to be grown year-round without requiring large amounts of conventional farmland. This approach reduces the strains of population increase and land scarcity while sustainably increasing food production. Compared to conventional agriculture, indoor farming minimises water use and lessens environmental effects by utilising technologies like hydroponics and aeroponics. Because of this, indoor farming offers a practical solution for guaranteeing food security and providing the rapidly growing populations of Asia Pacific with the food they need in an environmentally friendly and resource-efficient way.

Asia Pacific Indoor Farming Market Restraints and Challenges:

The establishment of an indoor farm involves a significant initial outlay of funds, which include infrastructure investments, cutting-edge technologies like LED lights and climate control systems, and labour for hand pollination because insects are not allowed. The financial obstacles present noteworthy difficulties for farmers wishing to engage in indoor farming. Furthermore, the amount of energy needed to keep indoor farms operating at their best might be high, particularly if they depend on fossil fuels. This reliance creates environmental concerns about sustainability and carbon emissions in addition to increasing operating costs. Nevertheless, despite these barriers, developments in agriculture and technology are progressively removing these difficulties. The environmental impact and cost burden of indoor farming are being lessened by advancements in automated pollination techniques, renewable energy sources, and energy-efficient lighting systems. Furthermore, it is anticipated that the upfront costs of establishing indoor farms will go down as economies of scale are reached and technology becomes more widely available, making indoor farming a more sustainable and economically viable way to meet the food needs of an expanding population while causing the least amount of environmental harm.

Asia Pacific Indoor Farming Market Opportunities:

There are plenty of opportunities in the Asia Pacific indoor farming sector. Indoor farms can conveniently meet the growing demand for fresh produce in the vicinity of rapidly expanding city centres due to rapid urbanisation. Additionally, the growing affluence in the area feeds customer demand for high-quality, healthful food, which indoor farming excels at producing. Governments are realising this potential and are encouraging investment in indoor farming infrastructure and technology by providing grants, subsidies, and tax incentives. Technological developments in automation, vertical farming, and LED lighting are drawing more participants to indoor farms since they increase their efficiency and affordability. Ultimately, consumers are drawn to sustainability, and indoor farming provides an answer by reducing the need for pesticides, water, and transportation emissions through local production.

ASIA-PACIFIC INDOOR FARMING MARKET REPORT COVERAGE:

Asia Pacific Indoor Farming Market Segmentation:

Asia Pacific Indoor Farming Market Segmentation: By Facility Type:

• Greenhouses
• Vertical farms
• Shipping Container
• Building-based

The Asia Pacific Indoor Farming Market Segmented by Facility Type, Vertical Farms held the largest market share last year and is poised to maintain its dominance throughout the forecast period. Owing to the increasing use of environmentally friendly methods for producing fruits and vegetables. In addition, it is anticipated that customers' shifting food-purchasing habits will increase demand for organic food. With cutting-edge methods like controlled environment agricultural technology, which uses artificial environmental monitoring, light management, and fertigation, indoor farming shields crops from harsh weather. To meet the growing need for food, farmers are introducing novel crop production techniques like vertical farming and greenhouses. In 2023, the kind of greenhouse facility held the largest market share. Often referred to as a hothouse, a greenhouse is a confined space composed of transparent materials where flowers, crops, and plants are grown. Climate is regulated in greenhouses to improve the calibre and yield of crops. Moreover, greenhouses allow for higher yield output than conventional farming methods.

Asia Pacific Indoor Farming Market Segmentation: By Component:

• Hardware
• Software
• Services

The Asia Pacific Indoor Farming Market Segmented by Component, Hardware held the largest market share last year and is poised to maintain its dominance throughout the forecast period. As hardware is essential to keeping indoor farms in good condition. In order to facilitate the production of crops indoors, the section is further divided into irrigation systems, sensors, lighting systems, and climate control systems. Due to its ability to generate an atmosphere that is favourable to plant growth, the climate control system is anticipated to grow at the fastest rate over the projection period. Among other things, the system uses humidifiers, air movement fans, air conditioners, heaters, and chillers to help regulate the interior temperature. The programme tracks the origin of the fruit and vegetables, including the grower, crop batch or patch, land area or field, and supplier information. The market has been further divided into software that is cloud-based and web-based. The cloud-based software market is expected to grow significantly in the upcoming years due to its ability to gather millions of data points in real time. These data points can then be analysed using machine learning techniques to identify changes in specific environmental parameters that have an impact on the final product's yield and taste.

Asia Pacific Indoor Farming Market Segmentation: By Growing Mechanism:

• Aeroponics
• Hydroponics
• Aquaponics

The Asia Pacific Indoor Farming Market Segmented by Growing Mechanism, Hydroponics held the largest market share last year and is poised to maintain its dominance throughout the forecast period. Because it is easy to use and requires little initial setup, hydroponic farming is becoming increasingly popular. In order to support the growth of the plant, a mineral solution is put around the roots of the plant in place of the soil. Proponents of hydroponics argue that it can mitigate the effects of overexploitation and intensive farming on the environment, reduce the threat of climate change, and save species from extinction. Hydroponic farming is superior to traditional soil-grown farming because it uses water more efficiently, creates a microclimate, takes less labour, requires no soil, and yields food of a higher calibre. The hydroponics approach also removes the possibility of infections being caused by soil organisms. It is anticipated that rising public knowledge of the negative effects of pesticides will increase demand for hydroponics. Throughout the projection period, the aquaponics segment is expected to rise at a substantial CAGR. Combining hydroponics and aquaculture results in aquaponics, which uses less toxic chemicals during cultivation. One of the main benefits of aquaponic agriculture is the reduced amount of water lost as compared to traditional farming methods. In contrast to conventional farming, aquaponics uses around 90% less water. Additionally, aquaponics is used to cultivate a variety of plants, including chives, sage, parsley, mint, basil, wheatgrass, strawberries, melons, and peppers.

Asia Pacific Indoor Farming Market Segmentation: By Crop Category:

• Fruits, Vegetables and Herbs
• Flowers and Ornamentals

The Asia Pacific Indoor Farming Market Segmented by Crop Category, Fruits, Vegetables and Herbs held the largest market share last year and is poised to maintain its dominance throughout the forecast period. The fruits, vegetables, and herbs category is anticipated to lead the indoor farming industry. The expansion of this category is being driven by the rising output of commonly produced fruits, vegetables, and herbs like lettuce, tomatoes, cucumbers, bell peppers, and chilli peppers. Large-scale cultivation of these crops yields maximum crop profit for the businesses engaged in their production. Due to its high rate of production, tomatoes are the main crop that is grown, and as such, they held the biggest market share in 2023. Over the course of the projected period, the market expansion is anticipated to be greatly aided by the flowers and ornamentals segment. In 2023, the segment held a market share of more than 28.08%. Growth in the market is anticipated to be driven by the growing usage of flowers and ornamentals for aesthetic and decorative purposes. The portion has been divided into three categories: ornamentals, annuals, and perennials. Due to rising sales, ornamental flowers had the most market share in 2023.

Asia Pacific Indoor Farming Market Segmentation: By Region:

• India
• China
• South Korea
• Japan
• Australia
• Rest of APAC

The Asia Pacific Indoor Farming Market Segmented by Region, India held the largest market share last year and is poised to maintain its dominance throughout the forecast period. Crop cultivation in an indoor environment with less pesticide use is known as indoor farming. The affordability of this technology, together with its capacity to lessen dependency on fossil fuels and traditional farming equipment, has positively impacted the market demand for it in India. The nation's thriving floriculture and horticultural industries are also contributing to the market's expansion. Furthermore, supportive policies and projects that are being established for vertical farming are other drivers propelling the market's expansion. For example, AS AGRI AND AQUA LLP launched its cutting-edge vertical farming project in Nagpur, Maharashtra, in December 2023. The project, which intends to help farmers in the Vidarbha region address significant agricultural difficulties related to climatic and drought conditions as well as inadequate irrigation systems, is anticipated to be the largest vertical farming project in Asia. The increasing output of organic crops and decreasing use of chemicals, along with technological advancements to support urban farming, are opening up new markets for indoor farming in India.

COVID-19 Impact Analysis on the Asia Pacific Indoor Farming Market:

The Asia Pacific indoor farming market faced a wide range of new opportunities and problems as a result of the COVID-19 outbreak. At the beginning, lockdowns and other restrictions caused disruptions to traditional supply networks, which highlighted how resilient indoor farms are in providing food security closer to customers. As a result of this recognition, the industry saw an increase in interest and funding as players looked for dependable, regionally relevant food production solutions. Unfortunately, the pandemic's financial burden forced some prospective investors to be cautious, which resulted in postponements or reduced plans for indoor farming endeavours. Notwithstanding these obstacles, the crisis acted as a spur to increase understanding of the advantages of indoor farming, such as its capacity to prevent supply chain interruptions and guarantee food sovereignty. The Asia Pacific indoor farming business is still developing as the long-term effects of COVID-19 become clear, and there is room for growth as customer tastes for resilient and sustainable food production techniques change and awareness of the disease increases.

Latest Trends/ Developments:

Urban agriculture is changing due to the rise of vertical farming, especially in nations with limited areas like Singapore and Japan. This method maximises space utilisation by stacking growing systems vertically, which makes it perfect for heavily populated locations. Advanced automation and artificial intelligence (AI) combined are revolutionising indoor farming at the same time. This allows for data-driven decision-making and remote monitoring while optimising processes like temperature management, irrigation, and fertiliser delivery. In addition, the desire from consumers for environmentally friendly food options has led to an increasing emphasis on sustainable and local production. Indoor farms emphasise low pesticide and water consumption, as well as the possibility of integrating with renewable energy sources, to provide year-round production with little environmental impact. Furthermore, the ability to precisely manage growth conditions makes it possible to cultivate speciality crops like medicinal plants, herbs, and microgreens, which meet consumer demand for unusual and health-promoting food options.

Key players:

1. Argus Control Systems Ltd.
2. Certhon
3. Richel Group
4. Netafim
5. General Hydroponics
6. Hydrodynamics International
7. Illumitex
8. Lumigrow
9. Signify Holding
10. Bowery