The Next Decade of Vertical Farming: Mapping Futures with Scenario Analysis (2025–2035)

What Will the Future of Vertical Farming Look Like?

In an era defined by rapid technological progress, climate instability, and evolving consumer demands, the future of vertical farming is far from linear. To help stakeholders navigate this complexity, Agritecture employs scenario analysis, a strategic methodology that blends data, expert insights, and systemic thinking to anticipate plausible futures for our clients.

By exploring not just what could happen, but why it might happen, scenario analysis equips investors, policymakers, and growers with tools to make informed, resilient decisions. This approach isn't about crystal balls—it's about creating actionable frameworks to prepare for uncertainty.

For vertical farming, scenario analysis offers a roadmap to 2035, illuminating paths shaped by innovation, consumer trends, and environmental crises. Below, we delve into Agritecture’s methodology, three potential scenarios, and their implications for stakeholders.

A Fresh Market Reality Check

First, we need to get some baseline understanding of the products these farms grown and the market reality that exists today. Vertical Farming’s Role in the North American Fresh Produce Market

The North American fresh produce market is a dynamic and growing sector, with significant variation in consumer demand, production methods, and pricing. Recent estimates suggest:

• Market Value: The U.S. fresh produce market is valued at approximately $96–$120 billion annually, with growth projected at a compound annual growth rate (CAGR) of 4.1%–4.7% from 2023 to 2030.
• Local Production: Local food sales remain a fraction of total food sales, with direct farm sales in the U.S. amounting to $9 billion in 2020. This highlights the relatively small, but growing, share of locally produced food in the broader market.
• Market Segmentation: While precise data on segmentation is limited, consumer trends point to three broad categories:

Luxury (estimated ~5%): High-end specialty produce targeted at affluent consumers and high-end restaurants.

Quality (~20%): Premium goods appealing to middle- and upper-income households, often tied to health and sustainability claims.

Commodity (~75%): Bulk produce sold at low margins, largely dominated by field farming due to its cost advantages.

Vertical farming today mostly occupies a sliver of the luxury market, relying on premium pricing to offset production costs that are significantly higher than those of field or greenhouse operations. Spoiler alert! ?? Based on our scenario analysis, by 2035, even under optimistic scenarios, vertical farms are unlikely to capture more than 25% of the fresh market, constrained by high costs and limited scalability.

Agritecture’s Scenario Analysis Methodology: Designing Future-Proof Strategies

Scenario analysis is not about predicting the future—it’s about preparing for it. Agritecture’s methodology provides a structured, data-driven framework for exploring multiple plausible futures, helping stakeholders make informed decisions in the face of uncertainty. This approach is especially valuable for emerging industries like vertical farming, where market dynamics, technological advancements, and environmental challenges converge.

1. Defining the Central Question

At the heart of our analysis lies a focused question designed to uncover the most critical uncertainties. For this study, we asked: How will vertical farming compete with field and greenhouse crops in North America on a delivered-cost basis for leafy greens, vine crops, and berries by 2035? This framing ensures relevance to stakeholders by addressing both the economic viability of vertical farming and its place in the broader fresh produce market.

2. Identifying Key Drivers

We begin by identifying and categorizing the forces shaping vertical farming’s future:

• Social: Urbanization, consumer preferences for sustainability, and demand for nutrient-dense food.
• Technological: Innovations in robotics, LED lighting, and seed engineering.
• Economic: Shifts in production costs, energy prices, and market structure.
• Environmental: Climate risks, water scarcity, and the growing frequency of natural disasters.
• Political: Policies promoting sustainability, trade tensions, and agricultural subsidies.

These drivers are divided into predictable trends (e.g., population growth, urbanization) and uncertainties (e.g., future energy costs, policy changes).

3. Mapping Plausible Futures

Using these drivers, we build scenarios that combine different assumptions about how uncertainties might evolve. Each scenario represents a distinct yet plausible future:

• Scenario 1: Technological Renaissance Innovation in robotics, automation, and lighting efficiency reduces production costs, enabling vertical farming to compete with greenhouses and, in some cases, field farming.
• Scenario 2: Consumer-Led Revolution A surge in consumer demand for transparency, sustainability, and highly nutritious functional foods expands premium markets for vertical farming.
• Scenario 3: Crisis-Driven Resilience Climate crises and geopolitical instability force the adoption of vertical farming as a resilient, localized food production method.

4. Testing Scenarios with Economic Models

Each scenario is rigorously tested using quantitative models and expert input. These models evaluate:

• Production Costs: How technological advancements, energy efficiency, and automation impact costs per pound of produce.
• Market Dynamics: Consumer willingness to pay for premium products versus the scalability of vertical farms.
• Environmental Pressures: The role of water scarcity, extreme weather, and carbon emissions in reshaping agriculture.

We use real-world benchmarks to ensure our projections reflect actual market conditions. For example, the current production costs for lettuce vary significantly depending on the farming method:

• Field-grown lettuce: Approximately $0.65 per pound, benefiting from economies of scale and lower infrastructure requirements.
• Greenhouse-grown lettuce: Around $2.33 per pound, factoring in controlled environment systems and higher operating expenses.
• Vertical farming lettuce: Estimated at $3.07 per pound, driven by significant energy use, high-tech infrastructure, and operational costs.

These benchmarks provide a realistic foundation for assessing the economic viability of vertical farming under different scenarios and market conditions.

5. Evaluating Likelihood and Strategic Implications

The scenarios are assessed for their:

• Feasibility: Likelihood of occurring based on current data and trends.
• Impact: Potential to disrupt markets, influence investment strategies, or reshape food systems.

Scenario Analysis: Three Plausible Futures for 2025–2035

Scenario 1: Technological Renaissance

Key Developments:

• Automation reduces labor costs by 50%, with fully robotic systems managing seeding, harvesting, and packaging.
• LED efficiency improves by 15–25%, cutting energy expenses that currently account for 40–60% of operational costs.
• Crop engineering produces higher-yield, nutrient-dense varieties tailored for indoor environments.

Market Impact: This scenario narrows the cost gap between vertical and greenhouse farming but does not achieve cost parity with field-grown produce. Vertical farming’s primary market remains high-value crops like leafy greens, strawberries, and herbs.

Likelihood: High Technological advancements in robotics and LEDs follow predictable trajectories, with robotics costs projected to decline by 50% by 2030.

Challenges:

• High upfront capital costs continue to deter widespread adoption.
• Energy costs remain a barrier in regions lacking renewable infrastructure.

Scenario 2: Consumer-Led Revolution

Key Trends:

• Transparency technologies, like blockchain and multi-spectral imaging, enhance trust in vertically farmed produce.
• The "food as medicine" trend drives demand for functional crops, such as high-protein lettuce or vitamin-rich berries.
• Urban vertical farms cater to affluent consumers, who are willing to pay a premium for sustainability and nutrition.

Economic Impact: The quality and luxury segments expand, but vertical farming struggles to scale beyond urban centers and affluent markets.

Likelihood: Moderate While consumer preferences for sustainable and healthy food are growing, price sensitivity limits demand beyond premium markets.

Challenges:

• Scaling production while maintaining quality.
• Price competition from other sustainable farming methods, such as high-tech greenhouses.

Scenario 3: Crisis-Driven Resilience

Key Drivers:

• Climate risks—droughts, heatwaves, and extreme weather—make traditional farming less viable.
• Water scarcity increases reliance on vertical farming, which uses dramatically less water than field farming.
• Supply chain disruptions lead to policy support and subsidies for resilient food systems.

Market Impact: Vertical farms become essential for food security in regions vulnerable to climate shocks or geopolitical tensions. However, their expansion remains contingent on external shocks and sustained subsidies.

Likelihood: Moderate With global temperatures rising and geopolitical risks increasing, this scenario becomes more plausible over time.

Challenges:

• Dependence on external funding and policy support.
• High energy consumption remains an economic hurdle.

The Verdict: A Niche Role for Vertical Farming in North America

Agritecture’s analysis is clear: vertical farming will remain a niche player, focused on high-value segments like leafy greens and berries. While technological advancements and environmental pressures will drive growth, cost and scalability challenges will prevent widespread adoption in the commodity market.

What This Means for Stakeholders:

• Investors: Focus on high-tech automation and premium market opportunities.
• Policymakers: Support innovation with subsidies for energy-efficient technologies.
• Operators: Target urban and affluent markets, where demand for quality and sustainability is highest.

If you want to dive deeper, check out my keynote talk below where I discuss a similar set of predictions for the future of vertical farming:

Plan for the Future with Agritecture

Success in vertical farming demands informed, data-driven strategies. Agritecture’s scenario analysis empowers stakeholders to navigate this complex landscape with confidence. This analysis was focused on North America and a specific question and timeline and there are so many other scenarios and markets worth exploring with this methodology.

Contact us today to explore how scenario analysis can future-proof your strategy. Together, let’s shape a smarter, more sustainable food system. Book me for an introductory call here.