Industry Trends: Farming Forward - CEA
Vertical Farming: From Hype to Hard-Won Profitability
From natural disasters to financial turmoil, vertical farming has endured plenty of turbulence. Few agricultural concepts have sparked as much excitement – and skepticism – as Controlled Environment Agriculture (CEA). Its promise is compelling: food grown anywhere, anytime, with less land, less water, and no pesticides. Yet the sector has struggled with bankruptcies, soaring energy costs, and unmet investor expectations.
At FRUIT LOGISTICA 2025, the CEA Alliance addressed these challenges head-on. One highlight was the contribution of AeroFarms CEO Molly Montgomery, who offered a rare insider’s view of how discipline, focus, and innovation can turn vertical farming into a viable business.
A Career Shaped by Crisis
Montgomery’s perspective is rooted in a lifetime across the fresh produce chain – from field crops to greenhouse operations and now vertical farming. She recalled how a sequence of disasters in 2017-2018 reshaped her outlook: Hurricane Harvey in Texas, Hurricane Irma in Florida, and devastating wildfires in California all wiped out harvests and left crops to rot in the fields.
“I actually thought vertical farming was more of a ‘nice to have’ in the US – something you really needed in places like the Netherlands or Canada,” she admitted. “But in that moment I realised that CEA is critical for everyone.”
What Makes Vertical Farming Different
Unlike outdoor agriculture or traditional greenhouses, vertical farms are entirely climate agnostic. “You can grow anywhere, regardless of weather,” Montgomery explained. AeroFarms’ facility in Danville, Virginia, operates in a sealed warehouse, with crops stacked to the ceiling under precision lighting and fed by irrigation systems.
The numbers are striking:
- 230 times less land use than conventional farming
- 90 per cent less water consumption
- No pesticides or soil degradation
- 365-day, weather-independent production
“It snowed six inches outside in January,” Montgomery recalled. “Inside, the plants just kept growing.”
The Hard Question: Can It Be Profitable?
The sector has long agreed on vertical farming’s sustainability benefits. The sticking point is profitability. Montgomery was frank: “Investors poured in money in the 2000s and 2010s, but capital dried up in 2023. Returns weren’t there.”
To navigate the downturn, she laid out three lessons:
- Get good, then get big.
- Right team, right time.
- Organise for results.
Proof of Concept in Danville
This disciplined approach has paid off. Montgomery revealed that the Danville farm reached profitability in Q4 2024 – a milestone for a company that emerged from bankruptcy barely a year earlier. AeroFarms now supplies every Whole Foods in the US and over 250 Costco stores. And it is preparing to build a second farm in the western US to cut logistics costs and carbon footprint.
Innovation Without Illusions
Still, Montgomery was clear: vertical farming is not a panacea. “It’s not the one solution that will save us all. We need innovation across the entire supply chain – outdoors, greenhouses, and vertical farms.”
Looking ahead, she sees vertical farming as best suited to crops with a fast turnaround, such as microgreens, which are an AeroFarms speciality. With crop cycles of just 5.5 days, they align well with the factory-like rhythm of vertical systems. Longer-cycle crops like spinach or lettuce may follow as efficiency improves.
A Sector at a Turning Point
Montgomery argued that vertical farms can indeed be both sustainable and profitable, but only under the right conditions. “The math needs to work,” she explained, pointing out that success depends on having a differentiated product at a sustainable price point, supported by enabling technology that can keep both production costs and the cost of capital at levels that make profitability realistic. At the same time, Montgomery highlighted the scale of the challenges ahead, stressing that it will require collaboration and innovation across the entire global produce supply chain. She also reminded the audience that vertical farming is still at a very early stage: “Vertical farming is in its infancy. We’re just in the beginning but I do believe that vertical farms have a critical role in our future.”
The big question left hanging:
Will vertical farming move from niche to necessity – and secure its place as a pillar of global food security?
This newsblog article was created in partnership with Fruitnet Media International.