Hydroponics is a modern farming technology, but the concept has been in existence for quite long. It’s the secret behind the hanging gardens of Babylon in 600BC, when lush gardens on the wall of the metropolis kept on blooming in spite of the dryness of the Euphrates river.
Today the world faces potential challenges in terms of food production that calls for the need for a solution that makes farming easier, saves space and water, and gives everyone the opportunity to reap bounties from their backyards.
Guess what system of farming ticks all the boxes? Hydroponics farming. In this article we’ll explore hydroponics farming and its financial prospects in today’s agritech market.
What Is Hydroponics Farming: Facts and Myths
If you’re like most people, you probably think of farming as rows of crops planted outdoors in soil, watered by rainfall, and harvested seasonally. But that traditional picture is being disrupted by a high-tech, sustainable climate smart farming method called hydroponics.
Hydroponics allows plants to be grown without soil, using a nutrient-rich water solution instead. The roots are suspended in a mineral solution contained in trays or pipes, with the plants supported by an inert growing medium like perlite, vermiculite, or coconut fiber.
While it may sound like science fiction, hydroponic farming is rapidly going mainstream as growers and entrepreneurs recognize its amazing advantages over conventional agriculture.
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I have said this a hundred times, but I think that our children are going to be astonished that we poured water into dirt to grow food. In maybe twenty, thirty years, they will find it hard to believe we poured polluted drinking water into the dirt? – Vitalii Jidkov (The Plant Doctor)
Market Potentials Of Hydroponics Farming
While still a small fraction of the overall food supply, the hydroponics market is exploding with double-digit growth year after year. According to a new report from Million Insights, the global hydroponic crop farming market is expected to reach a staggering $5.68 billion by 2025, expanding at a compound annual growth rate of 22.52%.
What’s fueling such rapid expansion? A convergence of factors including:
The Rise of Controlled Environment Agriculture (CEA)
With increasing threats from climate change, drought, and severe weather disrupting traditional outdoor farming, there’s a growing need for more controlled agricultural environments that can produce reliable yields despite external conditions.
Hydroponic greenhouses and indoor vertical farms allow precise regulation of temperature, humidity, nutrients, and all the key inputs for optimal plant growth. This enhances productivity, shortens crop cycles, and enables year-round cultivation even in harsh climates where conventional agriculture is difficult.
The Opportunity To Localize Food Production
Consumers want fresher, locally-grown options and are increasingly aware of the environmental costs associated with industrialized agriculture and long shipping routes for produce. Hydroponics provides a means of growing food much closer to consumers, reducing emissions while supplying incredibly fresh, nutritious harvests at all seasons. According to Farmer Samson Agbole of Soilless Farm Lab, hydroponics is the much needed solution to food security and hike in prices of food.
To produce out of season is one of the major keys to ensure that there is food security. With soilless farming, We can remove the high price of food by removing seasons and increase the wealth of the people, -Farmer Samson Agbole
Companies like AeroFarms, Plenty, and Bowery Farming are cashing in by locating high-tech vertical hydroponic farms directly within major metro areas like New York City and Seattle. By cutting out the long-haul supply chain, they can rapidly harvest and deliver nutrient-dense crops with incredible flavor to nearby markets.
Improved Technologies and Decreasing Costs
Continued research and innovation are making hydroponic production more efficient and economical. Advances in LED lighting, environmental control systems, seed genetics, nutrient delivery mechanisms and more have dramatically increased yields and streamlined operations. Investment in agricultural technology startups working on hydroponics reached over $1.5 billion in 2021 alone.
At the same time, the cost of setting up hydroponic greenhouse operations and large-scale vertical farms is decreasing, driven by economies of scale and specialized providers like UrbanFootprint offering pre-fabricated, plug-and-play hydroponic systems for growers.
According to market analysis firm BIS Research, the overall market value for vertical farming initiatives globally is expected to approach $19.86 billion by 2026. All this funding and economic activity is turbo-charging the hydroponics industry and commercializing new innovations in agritech.
Achieving Environmental Sustainability
As water scarcity issues amplify around the world, and consumers’ preferences shift toward eco-friendly, sustainably produced foods, hydroponics presents a compelling solution. Compared to open field farming, hydroponic systems can reduce water usage for crops by 90%.
The closed-loop design of hydroponic cultivation allows water to be continually recirculated and filtered, minimizing irrigation needs. Greenhouses and indoor farms also eliminate agricultural runoff, while vertically stacked layers make highly efficient use of land area.
According to Salim Halabi, the C.E O of Kryoptec, one of Canada’s largest commercial producer of hydroponic tomatoes and cucumbers, “Our hydroponic greenhouse operations use one-twentieth of the land and one-twentieth of the water required for the equivalent field production.”
Facilities like Kryoptech demonstrate how hydroponic farming can boost productivity and yields while being gentler on the environment and conserving precious natural resources. This scalable sustainability checks off several top priorities and is becoming an increasingly attractive draw for eco-minded consumers.
Crops For Emerging Markets
While leafy greens, tomatoes and herbs have been popular entry categories for hydroponic production, the technology is rapidly opening new markets. This digital farming system shows flourishing potential for cultivating unique fruits and vegetables, floriculture, ethnobotanicals, and even legal cannabis production.
An expanding crop diversity allows specialized growers to pursue niche products suited for local markets, meeting consumer demand for greater variety not typically found at grocery retail chains. There’s also significant opportunity for hydroponics to address the growing legal cannabis industry and the need for pharmaceutical-grade crops in markets where recreational cannabis has been legalized.
Hydroponics Farming: Driving The Future Of Food Security
The hydroponics industry is still in its early growth stage, with new companies, products, innovations, business models and revenue streams just beginning to sprout up around this robust agricultural technology. Surging interest from commercial enterprises, consumers and investors are sowing the seeds for a continued boom period and remarkable growth trajectory.
