Europe Indoor Farming Market Outlook, 2029

Europe is seeing a significant rise when it comes to indoor farming. Many countries compete to dominate the market, which results in the birth of many new farms. The number of indoor farms across the region is still relatively small. However, the sector is increasing at a rapid pace. Producing locally-grown greens all year round can be done without soil or sunshine in Europe due to the high emergence of indoor farming. While set-up and operational costs are increasing, there is a high demand amongst European environmentally conscious consumers. Further, changes in climate conditions, changes in temperature and water adversely across the region are creating higher demands for alternative farming methods. Further, various aggrotech companies are making efforts to curb the challenges by adopting indoor farming. They are also investing in research and development to combine technologies with food systems to enhance productivity and sustainability. Agriculture in the UK is highly automated and efficient, producing 64% of the total amount of food consumed across the country. Also, this sector occupies about 69% of the country’s land area, with most of the farmland located in the East of England. However, traditional farming in the UK often makes excessive use of fertilizers and pesticides, and it continuously suffers from labor shortages. Due to that, indoor farming has gained popularity in the United Kingdom in recent years as it is being set up in various cities across the country. Private and government funds are widely supporting indoor farming across the country, aiming to promote and integrate this approach into urban centers. For instance, in an urban environment such as London, indoor farms can guarantee a constant fresh supply to its population at any time. In addition to that, a growing number of indoor farming companies are currently operating in British cities, where they deliver fresh, pest-free produce to local supermarkets and consumers. Currently, the UK is home to the world’s largest high-rise farm as well as some of the world’s most innovative indoor farms.

According to the research report, "Europe Indoor Farming Market Outlook, 2029," published by Bonafide Research, the Europe Indoor Farming market is anticipated to add to more than USD 8.92 Billion by 2024–29. The growing demand for organic and healthy food in Europe is driving the market growth. In addition to that, the increasing challenges of limited land and space for growing crops across the region are encouraging cities and companies to adopt controlled environment agriculture practices. Further, the European indoor farming market is segmented into six prominent countries, including Germany, the UK, France, Italy, Spain, and the Netherlands. Among these countries, the UK is estimated to occupy a larger market share by 2029.

The growth of the Europe indoor farming market is significantly influenced by various growth mechanisms, including hydroponics, aeroponics, aquaponics, soil-based, and hybrid systems. Hydroponics remains the largest segment, favored for its efficiency in utilizing space and resources while allowing year-round crop production without soil. This method is particularly appealing in urban areas where land is limited. Aeroponics, which involves misting plant roots with nutrient solutions, is gaining traction due to its ability to enhance growth rates and reduce water usage. Aquaponics combines fish farming with plant cultivation, creating a sustainable ecosystem that appeals to environmentally conscious consumers. While soil-based systems are traditional, they are increasingly integrated into hybrid models that combine soil with advanced technologies to optimize yield and resource use. The trend across these mechanisms reflects a growing consumer demand for fresh, locally sourced produce, driven by health awareness and sustainability concerns. Additionally, technological advancements such as automation, LED lighting, and climate control systems are enhancing operational efficiencies across all segments.

The Europe indoor farming market is segmented by facility type into vertical farms, greenhouses, and others, with vertical farms emerging as the largest and fastest-growing segment. Vertical farms utilize stacked layers to maximize space and are particularly effective in urban settings, allowing for year-round production of crops without reliance on natural sunlight. This method appeals to environmentally conscious consumers seeking fresh, locally grown produce. Greenhouses, while traditional, remain significant due to their ability to harness natural light and provide controlled environments for plant growth. They are increasingly adopting advanced technologies like climate control systems and automated irrigation, enhancing their efficiency and yield. Other facility types include container farms and indoor deep water culture systems, which offer flexible solutions for growers looking to optimize space and resources. The overarching trend in this market is driven by the increasing demand for sustainable agricultural practices in response to climate change and urbanization challenges.

The Europe indoor farming market is increasingly segmented by components into hardware and software, with the hardware segment currently holding the largest share and experiencing robust growth. Hardware encompasses essential technologies such as climate control systems, lighting, irrigation systems, and sensors, which are crucial for maintaining optimal growing conditions in controlled environments. As the demand for efficient food production rises, investments in advanced hardware solutions have surged, enabling farmers to maximize yields while minimizing resource use. This trend is particularly evident in vertical farms, where sophisticated systems are necessary to manage the complexities of stacked crop production. On the other hand, the software segment is also gaining momentum, driven by the need for integrated solutions that facilitate data management and operational efficiency. Software applications enable farmers to monitor growth conditions, track expenses, and optimize resource allocation through real-time analytics. The increasing adoption of smart farming technologies across Europe is propelling both segments forward, with software projected to grow at a significant rate as more growers recognize its value in enhancing productivity and sustainability.



The Europe indoor farming market is segmented by crop type into fruits, vegetables and herbs, flowers and ornamentals, and others, with the fruits, vegetables, and herbs segment emerging as the largest and fastest-growing category. This segment benefits from the increasing consumer demand for fresh, organic produce, which is driving innovations in cultivation techniques. Vegetables such as lettuce, tomatoes, and peppers are particularly popular due to their high turnover rates and profitability. The emphasis on sustainable practices is also influencing this growth, as consumers become more health-conscious and seek locally sourced food options. Flowers and ornamentals represent another significant segment, appealing to both commercial growers and hobbyists who value aesthetics and sustainability in urban environments. The "others" category includes a variety of crops such as grains and specialty plants, which are gaining traction but currently represent a smaller share of the market.

Covid-19 Impact:
The COVID-19 outbreak has negatively impacted the overall market growth. Many countries initiated border closures to curb the infection spread by viruses, thereby causing interruptions in the supply chain for indoor farming. Moreover, the suspension of production facilities led to delays in the supply of agricultural chemicals such as herbicides and pesticides. However, an increase in the demand for organic food was witnessed during the pandemic, which is expected to fuel the need for indoor farming. A shift in consumer preferences regarding farming methods is also expected to boost market growth by 2029.

Considered in this report
• Geography: Europe
• Historic Year: 2018
• Base year: 2023
• Estimated year: 2024
• Forecast year: 2029

Aspects covered in this report
• Europe Indoor Farming Market with its value and forecast along with its segments
• Country wise Indoor Farming market analysis
• Application wise Indoor Farming distribution
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

Countries covered in the report
• Germany
• United Kingdom
• France
• Italy
• Spain
• Netherlands

Based on Growth Mechanism:
• Hydroponics
• Aeroponics
• Aquaponics
• Soil-based
• Hybrid

Based on Facility type:
• Vertical Farm
• Greenhouse
• Others

Based on components:
• Hardware
• Software

Based on Crop type:
• Fruits, Vegetables & Herbs
• Flowers & Ornamentals
• Others (rest crops)

The approach of the report:
This report consists of a combined approach of primary as well as secondary research. Initially, secondary research was used to get an understanding of the market and listing out the companies that are present in the market. The secondary research consists of third-party sources such as press releases, annual report of companies, analysing the government generated reports and databases. After gathering the data from secondary sources primary research was conducted by making telephonic interviews with the leading players about how the market is functioning and then conducted trade calls with dealers and distributors of the market. Post this we have started doing primary calls to consumers by equally segmenting consumers in regional aspects, tier aspects, age group, and gender. Once we have primary data with us we have started verifying the details obtained from secondary sources.

Intended audience
This report can be useful to industry consultants, manufacturers, suppliers, associations & organizations related to agricultural industry, food & beverage industry, government bodies and other stakeholders to align their market-centric strategies. In addition to marketing & presentations, it will also increase competitive knowledge about the industry.