2021 State of CEA Produce: Growing up amidst the chaos

Published August 17, 2021

Welcome to our 2021 State of the Produce Industry survey data. For over half a decade now, Produce Grower magazine has surveyed the industry by reaching out to growers across North America to see how their operations are faring, and we’re seeing some new developments. This year, at a macro-level, we are seeing a maturing, more profitable indoor produce sector that continues to grow and evolve to meet increased consumer demand.

First, we start with the good: Producers with annual sales volumes over the $1 million mark doubled from last year (from 10% of those surveyed in 2020 to 20%). Still, it seems indoor produce is currently a market of Davids and Goliaths, with the largest ($1 million-plus) and the smallest (less than $5,000 and $5,000-9,000 in annual revenues) operations making up 65% of the total responses.

Crop diversity seems to be increasing, too, with herbs, lettuce and cucumbers all up 5% over the 2020 numbers. Hot peppers, though, enjoyed the biggest bounce this year, jumping almost 20 percentage points (34% of the market in 2020, up to 51% this year), indicating a growing demand for spicy and unique pepper varieties grown indoors, year-round.

It’s also clear that technology adoption often equals success in this market: More and more of you are adding new technologies like supplemental LEDs, whether it’s to extend your season or intended to enable growing higher quality produce. Only 37% of you indicated that you do not use any type of supplemental lighting, which is down 13% from 2020.

The number of organic, OMRI-certified operations is increasing as well, albeit incrementally. Last year, 81% of respondents indicated they had zero acres of OMRI production under cover. This year, that number dropped precipitously to 59% of the surveyed growers, and growers with 50-75% of their production OMRI-certified increased from a paltry 1% of respondents last year to 11% this year.

Supply chain is one area where the data shows growers struggled mightily over the past 12 months. This is nothing exclusive to the indoor produce segment. All growers are dealing with these issues.

And finally, the effects of the COVID-19 pandemic on the indoor produce market appear to have softened over the past 12 months. Last year, 28% of you responded that the lockdowns and restrictions had impacted your businesses a great deal. This year, that number decreased to 17%, and those that were not impacted at all grew by 3%.

Read on for more insights into the rapidly changing CEA market.