Is Vertical Farming the Future of Agriculture?

Inside the growing tech industry changing the way we cultivate food.

Written by Ellen Glover
Is Vertical Farming the Future of Agriculture?
Image: Shutterstock
Matthew Urwin | Jan 05, 2024

For the first time in the 12,000-year history of agriculture, societies don’t need to have fertile soil or favorable weather conditions to grow what they want. Crops can be grown on trays stacked to the ceilings of 100-acre structures — with the assistance of temperature and light-controlling technology, automation and even agricultural robots — in a process called vertical farming.

What Is Vertical Farming?

Vertical farming is a means of growing food that uses vertical surfaces as opposed to traditional, horizontal farming. This usually takes place in skyscrapers, warehouses, shipping containers, greenhouses or other indoor facilities.

With over 2,300 indoor growing facilities now dotting the U.S. landscape, a quiet revolution is taking root, as vertical farming is poised to gain a foothold in one of the largest U.S. sectors and potentially change what food production looks like moving forward.

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What Is Vertical Farming?

Vertical farming refers to growing crops on vertical surfaces, rather than horizontally, and often in indoor facilities like warehouses or skyscrapers. While the practice has existed for thousands of years, its influence has grown in the U.S. as the tech industry seeks to make it the future of farming.

When done correctly, companies can grow everything from leafy greens like lettuce and kale to other common crops like herbs and tomatoes. For example, vertical farming startup Oishii produces Omakase berries, which are known for their sweetness and creamy texture and previously unique to the Japanese Alps. But Oishii founder Hiroki Koga and his team combined cutting-edge robotics, lighting, bees and time-honored Japanese growing techniques to replicate the elements of a “perfect day in Japan.” In a carefully controlled artificial environment, the company can now grow these berries year-round at its two New Jersey warehouses.  


Benefits of Vertical Farming

Reduced Land Use

Vertical farming doesn’t depend on land to grow crops and takes up less space due to stacking crops in vertical rows. Countries with less available land can then employ the technique to develop their agricultural sectors. This is a major reason why the Netherlands — a country less than half the size of Indiana — has become the second-largest agricultural exporter by value, falling short of only the U.S.  


Increased Sustainability 

Within the vertical farming industry, hydroponic farming provides a way for farmers to use far less water to grow crops when compared to traditional agriculture. Indoor environments also prevent issues like water evaporation and runoff, making vertical farming’s water usage more efficient. Since vertical farming isn’t dependent on land to grow crops, the practice doesn’t pollute the land or erode soil either.  


Year-Round Production

Growing crops in carefully regulated indoor environments means societies don’t need to have fertile soil or favorable weather conditions to grow what they want. Crops can be grown year-round on trays stacked to the ceilings of large facilities.


Fresher Produce 

Vertical farming enables companies to grow produce in warehouses and greenhouses close to different populations, reducing logistical headaches and pollution emitted during transportation. Traveling a shorter distance also means produce will come out fresher and raise the quality of food that people have access to, especially in food deserts and other underserved areas. 

“It significantly improves the customer experience when eating fresh produce,” Oishii founder Hiroki Koga told Built In. “These are usually fresher, cleaner and tastier than what’s available today.”


Safer Growing Environments

Pathogens like E. Coli pose a threat to traditional agriculture, but the highly regulated environments of vertical farm facilities can help prevent such outbreaks. Indoor facilities also naturally keep out other pests, removing the need for pesticides and allowing farmers to cultivate crops without applying harmful chemicals.  


Improved Efficiency 

Vertical farming can easily integrate agricultural robots to automate workflows, such as monitoring indoor conditions, tracking the status of crops and performing other basic tasks. Farmers and workers can then focus on more complex problems, reducing the costs of manual labor and raising the productivity of workers.  


Climate Change Resilience

In the face of a climate that is warming and becoming unpredictable, moving agriculture indoors can be a game-changing decision for populations in extreme environments. For example, Saudi Arabia and the United Arab Emirates have invested in vertical farming facilities to defy their hot and arid climates. These projects may prove to be life-saving as these countries’ climates become increasingly unlivable for both humans and crops.


Support for Marginalized Communities

While food production and climate change impact the whole world, they are uniquely harmful to people of color in the U.S. The areas in the U.S. that stand to benefit the most from vertical farming are its cities where access to affordable, nutritious food is virtually nonexistent — especially for low-income communities of color.

“Putting vertical farms in cities and areas that are facing food apartheid would be really important to help not only provide food, but also job opportunities and business opportunities for local people,” said Weslynne Ashton, an associate professor of environmental management and sustainability at the Illinois Institute of Technology. “Particularly Black, Brown and Indigenous communities that do face more marginalization and food apartheid.”


Lingering Economic Promise

Despite questions surrounding the viability of vertical farming, there’s still a belief the practice can reshape the agricultural sector. In an interview with the U.S. Department of Agriculture, Dr. Kai-Shu Ling estimates vertical farming can go on to make up 50 percent of leafy green markets and about five percent of the strawberry and tomato markets by 2033. 


Drawbacks of Vertical Farming

High Initial Costs 

Vertical farming’s barrier to entry is very high, requiring a lot of capital up front to both build the facility itself and scale the business. Even if vertical farming companies do manage to scale up and reduce costs, continuous expenses for necessities like artificial lights and temperature control technology can be difficult to maintain.


Long-Term Financial Headwinds  

The costs of building and maintaining vertical farming facilities remain a major setback, and this has become insurmountable for some agtech companies. Big industry names like AppHarvest and Fifth Season have either gone bankrupt or are close to going bankrupt after experiencing massive losses in recent years.

Vertical farming may have time to recover from its financial blows, but the realities of maintaining facilities and their artificial environments paint a sobering picture for companies looking to invest in this practice. 


Limited Crop Options

The likelihood of growing things like wheat or corn — staples of American agriculture — in an indoor environment is pretty remote. Even if it does happen, we are “very far away from that,” Ashton said. “I don’t think we’re going to move to all vertical agriculture, but I think it can be an important component in a diverse food ecosystem to provide more nutrient-dense food for people in cities.”


Energy Consumption 

While it’s true that indoor agriculture brings the food closer to the consumer, meaning fewer resources are being used to ship produce around the country, Illinois Institute of Technology professor Ashton said the industry is not as sustainable or environmentally friendly as some make it out to be.

“There’s a very high energy cost associated with the amount of light that you need to grow different types of plants. And, depending on the configuration, a need for heating, ventilation, cooling,” Ashton said. “That energy cost is really significant, and it is an important component of its carbon footprint.”


Carbon Emissions

Studies in the U.S., Canada and Europe have found that, on average, producing a pound of tomatoes indoors using fossil fuels releases up to 3.5 pounds of carbon into the atmosphere — about six times the carbon footprint of tomatoes that were field-grown in the tropics and shipped to other parts of the world, even when accounting for the diesel emissions from the refrigerated trucks that ferry them around. One study even found greenhouse-produced tomatoes generated 18 times the amount of greenhouse gases compared to open-field grown tomatoes. 


Renewable Energy Complications

Its outsized environmental impact is one of the main roadblocks preventing vertical farming from going full throttle. A way to get around that is to use more renewable energy. But, of course, the source of energy used by a given indoor farm is entirely dependent on its location, so it will be difficult to accomplish quickly. Getting there will require the improvement of our entire energy infrastructure, and the adoption of more renewable energy.

“You have to start thinking about not just one facility or the types of plants you’re growing, but how those facilities interact with the environment,” said John Reich, director at Precision Indoor Plants (PIP) and a scientific program director at the Foundation for Food & Agriculture Research (FFAR). “What are the inputs that go into it? Can they be renewable? Where do they come from? Do they participate in a circular economy?”

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Expensive Food Prices

The price of food grown in indoor farms needs to go down considerably. Oishii’s strawberries, for example, are much pricier than average — a box of six extra-large, eight large or 11 medium Omakase berries costs $20, or about $3.33 per berry. Before the company opened its second growing facility in Jersey City, boxes sold at $50. Founder Koga said those price tags will continue to shrink as Oishii scales and optimizes its technology.

“The cost of conventional agriculture is only going to go up. If you think about unstable weather conditions, the cost of labor, the cost of land, water — all of these things are never going to go down,” Koga said. “Vertical farming is only going to become more efficient over the years. So there will come an inflection point.”

Of course, there’s no guarantee that inflection point will ever come. Until then, produce grown in vertical farming facilities may remain out of reach for the average consumer. 


A Brief History of Vertical Farming

Vertical farming can be traced back as far as 2,500 years ago. The hanging gardens of Babylon are considered one of the first examples of vertical farming. About 1,500 years later, the Aztecs developed a form of hydroponic farming, creating floating rafts to grow crops on lakes and rivers. In the 1600s, French and Dutch farmers grew Mediterranean fruits on walls that retained heat to help the fruits survive colder conditions.      

Manipulating environments to suit the needs of food production is nothing new for humans, but the term ‘vertical farming’ itself didn’t gain traction until much later. In 1999, Dickson Despommier and his graduate students explored the concept of vertical farming as a way to feed growing urban populations, leading to the broader use of the term in the 2010s and 2020s.     

Vertical farming as a practice really didn’t become prominent in the United States until around 2020, but it has been used in countries like Japan and the Netherlands for decades, according to Koga, where greenhouses in general are a much more integral part of their culture and food production. Now, the much older greenhouse farming industry informs much of how the vertical farming industry currently operates.

Today, much of the work in creating more nutrient-dense food via vertical farming comes down to science. Instead of tweaking seeds so that they are optimized for weather and soil, researchers are working to create seeds that are best suited for an indoor, controlled environment.

One organization helping to fund that research is FFAR. For instance, FFAR invested some $7.5 million in the PIP consortium to research varietals specific to indoor planting.

“We’ve adapted plants throughout history,” Reich told Built In. “We need to try to see if we can adapt plants specifically to indoor agriculture, to see if that makes it more economically viable for the future.”


Frequently Asked Questions

Vertical farming uses less land and water, supports year-round crops, allows crops to be grown close to populations and removes the need for pesticides. 

Vertical farming requires indoor facilities that can be expensive to maintain and produces higher levels of energy consumption and carbon emissions than traditional agriculture.

Vertical farms can only support crops with high proportions of edible biomass. As a result, staple foods like corn, wheat and rice can’t be grown in vertical farming facilities.

Vertical farming can be profitable, but it comes with challenges. Companies must take the costs needed to run vertical farming facilities, the price of their produce and other financial factors into consideration.

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