Plant Factory Market Size, Share, Growth & Industry Analysis, By Crop Type (Leafy Greens, Fruits and Vegetables, Flowers and Ornamentals, Others), By Light Type (Full Artificial Light, Sunlight), By Facility Type (Indoor Farms, Greenhouses), By Growing System, and Regional Analysis, 2024-2031

Market Definition

The market encompasses controlled-environment agriculture (CEA) systems that integrate advanced technologies to optimize plant growth. These technologies include hydroponics, aeroponics, and aquaponics, combined with artificial lighting, climate control, and automated nutrient delivery systems to enhance crop yield and quality. 

Plant factories facilitate year-round cultivation of leafy greens, herbs, microgreens, and high-value medicinal plants by maintaining precise control over temperature, humidity, CO₂ levels, and light spectra. 

Their ability to produce pesticide-free crops with minimal water usage makes them essential for food security and specialized crop cultivation, including sustainable urban farming, pharmaceutical-grade botanical production, and research applications.

Plant Factory Market Overview

The global plant factory market size was valued at USD 2,310.0 million in 2023 and is projected to grow from USD 2,457.3 million in 2024 to USD 3,978.1 million by 2031, exhibiting a CAGR of 7.12% during the forecast period. 

The market is expanding due to advancements in automation within controlled-environment agriculture, enhancing operational efficiency, reducing labor costs, and optimizing resource utilization. Increasing consumer demand for pesticide-free, locally grown produce further accelerates market growth, encouraging large-scale adoption of hydroponic and vertical farming systems. 

Additionally, government initiatives for sustainable food production and AgriTech innovation are driving high-yield, climate-resilient farming solutions.

Major companies operating in the plant factory industry are AeroFarms, Plenty Unlimited Inc., MIRAI, Infarm, BrightFarms, Gotham Greens, Sky Greens, Green Sense Farms, Oishii, Vertical Harvest, Freight Farms, Crop One Holdings, AppHarvest, JFC Group, and Hydrofarm.

The growing preference for pesticide-free and nutrient-rich crops is accelerating the growth of the market. Consumers are shifting toward organic and locally grown vegetables due to increasing concerns about food safety and health. 

Plant factories ensure this by maintaining a fully controlled environment that regulates temperature, humidity, CO₂ levels, and light spectra, preventing contamination from soil, water, and air pollutants. Supermarkets, restaurants, and food service providers are investing in these facilities to meet the rising demand for fresh and sustainable produce.

• In March 2025, BrightFarms began shipments from its newly launched 1.5-million-square-foot greenhouse in Macon, Georgia. This expansion strengthens the company’s capacity to supply fresh, pesticide-free leafy greens to consumers. BrightFarms' hydroponic farm leverages advanced automation to maintain optimal growing conditions throughout the year for consistent yield, quality, and resource efficiency.

Key Highlights:

1. The plant factory industry size was recorded at USD 2,310.0 million in 2023.
2. The market is projected to grow at a CAGR of 7.12%from 2024 to 2031.
3. Asia Pacific held a market share of 36.12% in 2023, with a valuation of USD 834.4 million.
4. The leafy greens segment garnered USD 998.2 million in revenue in 2023.
5. The full artificial light segment is expected to reach USD 2,325.0 million by 2031.
6. The indoor farms segment secured the largest revenue share of 56.33% in 2023.
7. The non-soil-based is poised for a robust CAGR of 8.42% through the forecast period.
8. Europe is anticipated to grow at a CAGR of 7.48% during the forecast period.

Market Driver

Climate Change and Land Scarcity

The growing impact of climate change and the decreasing availability of arable land is accelerating the adoption of plant factories as a sustainable solution for food production. 

Extreme weather conditions, soil degradation, and water scarcity are disrupting traditional agriculture, creating a need for alternative farming methods. This shift is driving market growth by increasing demand for controlled-environment agriculture, which ensures consistent crop yields, resource efficiency, and reduced dependency on traditional farmland.

• In December 2024, BrightFarms launched its first greenhouse in Texas, bringing fresh, locally grown leafy greens to the South Central and Southwest regions of the U.S. Located in Lorena, the 1.5 million square-foot facility incorporates advanced cooling technology, including KUBO’s Ultra-Clima system, to maintain optimal growing conditions year-round.

Additionally, urban expansion is reducing farmland, increasing the need for alternative farming solutions. In response, governments and private sector are investing in vertical farming and hydroponic systems. This shift is positioning plant factories as a key solution for global food security and agricultural sustainability.

Market Challenge

High Initial Investment and Operational Costs

The plant factory market faces significant challenges due to the high initial investment and operational costs associated with advanced infrastructure, energy-intensive climate control systems, and automation technologies. These expenses can limit market entry for new players and slow expansion efforts.

Market players are addressing this challenge by adopting energy-efficient LED lighting, renewable energy sources, and AI-driven automation to optimize resource utilization and reduce costs. Strategic partnerships, government subsidies, and technological innovations in hydroponic and aeroponic systems are further helping businesses enhance profitability and scale operations sustainably.

Market Trend

Rising Adoption of AI and Automation

The integration of artificial intelligence (AI) and automation is transforming operations in the market. Advanced AI algorithms optimize lighting, irrigation, and climate conditions to maximize yield and minimize energy consumption. Robotics and sensor-based monitoring systems are improving efficiency by automating planting, harvesting, and quality control. 

Additionally, machine learning technologies analyze plant health and growth patterns, enabling predictive maintenance and real-time decision-making in nutrient optimization and disease prevention. These innovations are reducing labor costs while increasing production consistency. 

Companies investing in AI-driven plant factory solutions are gaining a competitive edge, accelerating market adoption and strengthening the role of automation in sustainable agriculture.

• In September 2024, Plenty Unlimited Inc. launched the world’s first large-scale indoor vertical strawberry farm in Richmond, Virginia. The facility employs AI-driven technology to analyze over 10 million data points daily across 12 grow rooms, optimizing conditions for each stage of plant development.

Plant Factory Market Report Snapshot

 Market Segmentation:

• By Crop Type (Leafy Greens, Fruits and Vegetables, Flowers and Ornamentals, Others): The leafy greens segment earned USD 998.2 million in 2023 due to its fast growth cycle, high yield potential, and year-round production capability. This meets the rising consumer demand for fresh, pesticide-free, and nutrient-rich produce while ensuring efficient resource utilization and profitability for market players.
• By Light Type (Full Artificial Light, Sunlight): The full artificial light segment held 57.52% of the market in 2023, due to its ability to ensure consistent, high-yield crop production independent of external climate conditions, optimizing growth cycles and resource efficiency through advanced LED lighting.
• By Facility Type (Indoor Farms, Greenhouses): The indoor farms segment is projected to reach USD 2,212.3 million by 2031, owing to its ability to ensure year-round, high-yield production through advanced climate control, automation, and resource-efficient hydroponic and aeroponic systems.S
• By Growing System (Soil-Based, Non-Soil-Based, Hybrid): The non-soil-based segment is poised for significant growth at a CAGR of 8.42% through the forecast period. This growth is driven by its ability to enhance yield efficiency, optimize resource utilization, and ensure high-quality crop production.

Plant Factory Market Regional Analysis

Based on region, the global market has been classified into North America, Europe, Asia Pacific, Middle East & Africa, and Latin America.

The Asia Pacific plant factory market share stood around 36.12% in 2023 in the global market, with a valuation of USD 834.4 million. Governments across Asia Pacific are actively promoting controlled environment agriculture to address food security concerns and enhance domestic food production. 

Countries such as Japan, China, and Singapore are investing in plant factory infrastructure, offering subsidies and policy support to encourage its adoption. Singapore’s "30 by 30" initiative, which aims to produce 30% of the nation's nutritional needs locally by 2030, has led to increased funding for plant factories. Additionally, the government of China is promoting agricultural modernization through high-tech farming initiatives across the country.

Furthermore, rapid urbanization in Asia Pacific is driving demand for efficient, space-saving food production methods. With shrinking arable land in densely populated cities such as Tokyo, Seoul, and Hong Kong, plant factories are emerging as a viable solution to meet the growing need for fresh produce. 

Vertical farming and hydroponic systems allow for high-yield crop cultivation in limited spaces, ensuring food availability in urban areas. This shift toward decentralized agriculture reduces reliance on long-distance supply chains, improving food resilience in cities.

Europe is poised for significant growth at a robust CAGR of 7.48% over the forecast period. Europe is at the forefront of agritech innovation, with companies leveraging artificial intelligence (AI), robotics, and automation to enhance plant factory efficiency. 

Smart climate control systems, AI-driven crop monitoring, and automated harvesting technologies are improving productivity while reducing operational costs. For instance, the Netherlands, is leading in the development of precision-controlled indoor farms, with advanced systems improving efficiency and consistency.

• In July 2024, iFarm began constructing a high-tech vertical farm in Switzerland. The facility will integrate advanced automation and AI-driven monitoring to optimize crop yield and resource efficiency. This development strengthens iFarm’s presence in the controlled-environment agriculture sector, supporting sustainable food production and reducing reliance on traditional farming methods.

Furthermore, major retailers and agribusiness corporations in Europe are investing heavily in plant factories to secure a stable supply of fresh produce. Supermarket chains such as Tesco, Carrefour, and Aldi are forming partnerships with indoor farm operators to stock vertically farmed greens for year-round availability. 

Leading food service providers and hospitality brands are incorporating locally grown, high-quality ingredients from plant factories to meet consumer demand for sustainable dining options. These strategic investments are expanding the market’s commercial reach, driving growth across the region.

• In January 2025, Oslo-based AgriTech startup Avisomo, which specializes in fully automated vertical farming solutions, secured USD 5.4 million in new funding from Innovation Norway. The investment will support the advancement of its indoor farming technology, promoting sustainable large-scale local food production.

Regulatory Frameworks

• The U.S. Department of Agriculture (USDA) oversees agricultural practices, including plant factories. Compliance with the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) is mandatory for pesticide use. The Food and Drug Administration (FDA) regulates food safety standards under the Food Safety Modernization Act (FSMA), which applies to produce from plant factories.
• The EU enforces stringent regulations on plant health and biosecurity. Imports of plants and plant products from non-EU countries require phytosanitary certificates, ensuring they are properly inspected and free from pests and diseases. The Department for Environment, Food & Rural Affairs (DEFRA) oversees plant health regulations, requiring phytosanitary certificates for imports and adherence to biosecurity measures.
• China's Ministry of Agriculture and Rural Affairs regulates agricultural practices, including plant factories. The country has been focusing on modernizing agriculture, promoting sustainable practices, and implementing standards for organic farming to ensure food safety and environmental protection.
• In Japan, the Ministry of Agriculture, Forestry and Fisheries (MAFF) provides guidelines and subsidies to promote plant factories, emphasizing technology integration and sustainable agriculture to enhance food security.

Competitive Landscape:

The plant factory industry is characterized by several market players adopting technology-driven strategies to enable large-scale cultivation of highly nutritious vegetables, driving market growth. Innovations in automation, climate control, and precision agriculture are optimizing resource efficiency, reducing reliance on traditional farming methods, and ensuring steady high-yield production. 

Advanced hydroponic and aeroponic systems, coupled with AI-driven monitoring, enhance crop quality while minimizing water and land usage. These advancements allow for year-round cultivation, mitigating seasonal fluctuations and supply chain disruptions. 

By integrating data analytics and smart farming techniques, companies are enhancing operational efficiency, reducing costs, and addressing the increasing demand for sustainable, high-quality fresh produce.

• In January 2025, AeroFarms introduced a patented technology for large-scale cultivation of highly nutritious microgreens, offering a fully commercialized, climate-independent and economically sustainable vertical farming solution. This breakthrough ensures year-round access to fresh, flavorful greens regardless of location while significantly reducing land and water usage.

List of Key Companies in Plant Factory Market:

• AeroFarms
• Plenty Unlimited Inc. 
• MIRAI 
• Infarm
• BrightFarms
• Gotham Greens
• Sky Greens
• Green Sense Farms
• Oishii
• Vertical Harvest
• Freight Farms
• Crop One Holdings
• AppHarvest
• JFC Group
• Hydrofarm

Recent Developments (Agreements/Expansion)

• In September 2024, Plenty Unlimited Inc. expanded its research and development operations with the construction of the world’s largest vertical farming research center in Laramie. Designed to enhance research capacity, the facility will support critical projects that benefit industry partners, advance agricultural innovation, and drive the future of sustainable farming.
• In September 2023, MIRAI finalized an equipment sales agreement with ONNA Greens AS in Norway to supply cultivation equipment for a fully enclosed artificial light-based plant factory as part of the second expansion phase, complementing the existing operational facility.
• In July 2024, Gotham Greens expanded its operations by opening new greenhouses in Colorado, Georgia, and Texas, while also enhancing its facilities in Providence, R.I., and Chicago. The company introduced a dedicated research and development area to drive innovation and product expansion. Additionally, Gotham Greens launched new offerings, including its Baby Spinach Mix, Greenhouse Crunch 9-ounce Family Size, and a range of salad kits featuring Green Goddess, Southwest Ranch, and Caesar dressings.