The Rise of Vertical Farming

The idea of Vertical Farming is not a new one, it was first proposed back in 1999 by Dickson Despommier, a professor of Public and Environmental Health at Columbia University. Along with his students, they developed a design for a skyscraper farm that they suggested could feed around 50,000 people.

Over two decades on this design has never been built, however, the seed had been sown and the idea of vertical farming was now firmly in the mind of many innovators, farmers and agriculture specialists.

One of the benefits of vertical farming is the increased crop yield that you can generate from significantly less land which simply put, means you can grow more, with less.

This has an environmental benefit too as by using less land, there are less resources needed to help cultivate the crops, less machinery being used and less disruption to the land, plants and animals that reside there.

Furthermore, due to the placement of the crops indoors, there is far less disruption to the crops from the weather – allowing for a greater overall yield and more consistent quality.

This alone means that crops can be planted, nurtured and harvested 365 days a year due to the controlled environments and lack of dependency on the seasons and the weather.

An early trial of a vertical farm in project in Scotland managed to grow tree seedlings x6 times faster than what would be expected in a traditional outdoor environment.

Despite the benefits, Vertical Farming has been a bit of a slow starter. According to the Financial Times, as of 2020 there is only around 74 acres of operational vertical farmland in the world.

The United States is currently leading the way with over 2,000 farms with Asia also increasing their use of this practice with the emergence of over 200 farms in Japan alone.

In Europe the ambition is growing. Some of the market leading firms investing in Vertical Farms are based in Germany, the Netherlands and Scandinavia. One initiative in Denmark looking to build a farm which could produce over 1,000 tonnes of vegetables annually.

By all accounts, Vertical Farming is big business and not one that is going anywhere but up. The market is currently estimated to be worth 5.1billion USD as of 2023 and is expected to reach 15.3billion by 2028, which is an increase of 10.2billion in just 5 years.

However, Vertical Farming is not without its own unique risk and challenges.

Firstly, it requires significant initial investment. Starting a Vertical Farm is far from cheap with one estimate suggesting that it could cost in excess of $100m to get a 60 hectare farm up and running.

Another challenge is energy costs which we all know have risen harshly recently. This could slow the scalability and dent profitability. As a result, several major global firms took steps to reduce their operations or move them to other locations where water and energy costs are much lower.

Linked closely to this is the environmental factor. Vertical Farming has a high reliance on artificial lighting and therefore produce a higher-than-average energy consumption vs traditional green housing.

Many businesses have subsequently turned their attention to LED lighting in order to use less electricity, resulting in lower operating costs and a reduction in carbon emissions.

The investment in LED light systems can generally be anywhere from 2 to 4 times higher than high-pressure sodium-vapour lamps – however, the return on investment in LED-based lighting can be achieved after just 12-24 months, making them more cost effective in the long run.