Hydroponics industry: A playbook for the industry with recommendations for each stakeholder to create a profitable business

Abstract

Hydroponics is a type of hydroculture. It is a revolutionary method of farming that uses root targeting technology, where nutrients in a liquid medium are directly targeted at the roots of the plants for direct absorption and no soil is required for this. Hydroponics was earlier a Western technology which showed promising results in efficiently growing temperate exotic vegetables while saving resources like water, land, etc and increasing the yield per sq mt. This direct plant root targeting technology of farming has picked up in India in the last 4-5 years. This fast pace growth attracted new companies and entrepreneurs. A lot of new firms have been started by new-age entrepreneurs in this industry. These firms are either EPC companies, farm owners, distributors, etc. The large farms in this industry are owned by – Urban Kissan (already has 32 acres of land under hydroponics and is set to achieve 10 tonnes of yield per month), DS Group, Junga Freshgreens, TritonWorks, etc. About 60% of the land under hydroponics in India is used to grow fruits & vegetables and the rest 40% is used to grow flowers. The rapid growth that has happened over the past 4-5 years put the industry growth at 13.53% CAGR. This growth has led to new challenges in the industry. Challenges like – the absence of lobby group to collectively present the industry voice to regulatory authorities, lack of standardization and certification, copying the western model hasn’t suited Indian conditions, slow growth of demand for hydroponics crops due to a significant difference from the traditional Indian food palette, and many others. In this report, we have tried to understand the challenges in each part of the value chain of Hydroponics in India – we have looked at it from the perspective of individual farmers, broad industry and science and tech. We have recommended solutions to many of these challenges. Each solution focuses on solving the challenge by involving all the stakeholders and solving at a government level, trade association level and at an individual farmer level to permanently mitigate the challenge. The goal of these solutions is to create a brighter future for the industry and make it more lucrative for new entrepreneurs and make it more profitable for existing players. Apart from understanding the challenges and recommending solutions, we have included a section on setting up an outdoor hydroponics farm. The information in this section is created by combining industry insights with research articles and can be a starting point to begin the journey for an entrepreneur aspiring to venture into this industry and become a farm owner. This report will help the farm owners to think broadly on all dimensions of this industry before setting up a farm and be aware of the challenges at each step.