Emerging agricultural markets have driven much of the global market developments over the last 20 years and are expected to continue that growth over the next ten years.
A lot of that growth has been driven by the rapid development and mechanization of agriculture in the People’s Republic of China. However, due to the development of China’s services sector, the slack will have to be picked up by other emerging markets like India and Vietnam if agricultural sector growth is to continue.
In this blog, we’ll discuss the qualities that define emerging agricultural markets, list some of the most promising countries by region, and discuss the challenges and opportunities for the growth of hydroponics in each region.
Emerging Agricultural Markets
Emerging agricultural markets are characterized by several key features. Firstly, they often exhibit diverse crop production, which helps adapt to varying climatic conditions and meet different consumer preferences.
Secondly, these markets are marked by rapid technological adoption, including the use of advanced farming techniques and digital tools to enhance productivity.
Growing foreign investment is another significant characteristic, as it stimulates market growth and development. Additionally, emerging markets frequently have evolving regulatory frameworks that aim to support agricultural expansion and sustainability.
Local market demand is increasing due to urbanization and shifting dietary preferences, leading to higher consumption of diverse agricultural products. Access to global markets is also improving, allowing these regions to export their produce more effectively.
The Largest Emerging Agricultural Markets
Emerging agricultural markets are diverse, and even though they share many characteristics, these regional differences mean that each country will have a slightly different path to achieving parity with developed markets.
Some of the largest challenges to the growth of hydroponics in emerging agricultural markets include unreliable power access which can devastate hydroponic harvests, the prohibitive cost of system setup and non-existent or inadequate logistics infrastructure.
Emerging Agricultural Markets in Africa
- Kenya (33% Agriculture Population)
- Ghana (40% Agriculture Population)
- Nigeria (38% Agriculture Population)
Africa is expected to be one of the main drivers of world economic development in the 21st century, but it might not the case that a rising tide lifts all boats – countries with rapidly developing economies like Ethiopia, Nigeria and Ghana are reaping most of the rewards.
According to OECD-FAO 2024 report, Sub-Saharan Africa’s agricultural production is expected to grow by 28% by 2033, while the Middle East and North Africa region is expected to grow by 22%.
Many countries in Africa face challenges with language diversity. In Ghana, a randomly selected pair of people has only an 8.1% chance of sharing a mother tongue. This makes all business difficult, but it has additional consequences for agricultural trade, limiting the adoption of modern agricultural technologies such as high-yielding variety seeds and negatively affecting crop yields.
Challenges for Hydroponics in Africa
- High startup cost
- Water infrastructure not as advanced as developed markets
- Limited access to finance, small farms lack microfinancing options
Opportunities for Hydroponics in Africa
- Climate Resilience (Containerized farms can ensure consistent crop production)
- Growth in urbanization correlated with higher incomes and spending
- Hydroponic water savings benefits regions affected by droughts, water scarcity
Emerging Agricultural Markets in South Asia
- India (43% Agriculture Population)
- Myanmar (46% Agriculture Population)
- Bangladesh (37% Agriculture Population)
India is a major producer of the world’s food supply, but as much as 82% of Indian farmers are considered subsistence farmers. It’s a similar number in Myanmar at 75%, and Bangladesh isn’t far behind with around 85% of farmers practicing subsistence farming.
Just about 47% of all farms in India are mechanized, meaning there’s significant progress that can be made in improving farm productivity and output.
Many people in the region live in rural areas, many still utilize outdated technologies and tools. This is a problem for the development of the entire region, as higher levels of human development are typically only achievable alongside rapid mechanization of agriculture and higher education access.
Both are powerful roadblocks that stand in the way of agricultural market development in the region.
Challenges for Hydroponics in South Asia
- Consumer awareness
- Lack of technical experience in hydroponic systems
- Prohibitively high initial investment
- Difficult for female entrepreneurs to access capital
Opportunities for Hydroponics in South Asia
Emerging Agricultural Markets in Southeast Asia
- Vietnam (34% Agriculture Population)
- Thailand (30% Agriculture Population)
- Philippines (24% Agriculture Population)
Like other countries listed in this article, agricultural markets in southeast Asia struggle with higher levels of subsistence farming and lower rates of mechanization than developed agricultural markets.
While all the countries listed above have made massive improvements in agricultural advancement since independence, this area is significantly behind developed agricultural markets when it comes to farm mechanization. Advancements like hydroponics have grown slowly in the country, mostly due to the high investment of system installment and maintenance.
Challenges for Hydroponics in Southeast Asia
- Small-scale farmers struggle with finding funding
- Lack of technical experience with hydroponics
Opportunities for Hydroponics in Southeast Asia
- Adoption of technology drives the change from old agricultural methods to highly mechanized forms of production
- Government support for hydroponics is strong
Emerging Agricultural Markets in Latin America
- Brazil (9% Agriculture Population)
- Argentina (7% Agriculture Population)
- Mexico (13% Agriculture Population)
Latin America is a region with a rich agricultural history. From the success of Brazil’s agricultural expansion to the development of Mexico’s
Challenges for Hydroponics in Latin America
- Energy costs, especially in Argentina, make hydroponics less viable
- Regulation can prevent innovation in the agriculture sector
Opportunities for Hydroponics in Latin America
- Female entrepreneurs in Latin America (Mexico especially) have easier access to education & capital when compared with other emerging market economies
Emerging Agricultural Markets in Eastern Europe
- Ukraine (14% Agriculture Population)
- Romania (18% Agriculture Population)
- Poland (8% Agriculture Population)
Countries in Eastern Europe struggled economically following the collapse of the Soviet Union, but the breadbaskets of the east are still a massively important region for agricultural market development.
Hydroponics has seen promising growth throughout eastern Europe region because of increased urbanization and rising incomes.
Challenges for Hydroponics in Eastern Europe
- Consumers are less educated about the benefits of hydroponic produce compared to traditional agriculture
Opportunities for Hydroponics in Eastern Europe
- Increased urbanization is a tailwind for compact growing systems like hydroponics
Summary
In conclusion, emerging agricultural markets are poised to play a crucial role in the global agricultural landscape over the next decade. These regions offer unique opportunities and face distinct challenges, particularly in the adoption of innovative farming techniques like hydroponics.
By addressing these challenges and leveraging their opportunities, emerging markets can enhance food security, promote sustainable agricultural practices, and contribute significantly to global food production. As we move forward, the continued development and support of these markets will be essential for meeting the world’s growing food demands and ensuring a resilient agricultural future.
Interested in purchasing a hydroponic farm in an emerging market? Pure Greens can meet the needs of growers worldwide, and we can ship our turn-key container farms to them, wherever in the world they may be. With precise control over the growing environment, our container farms can give growers the power to cultivate crops that wouldn’t be possible to grow in the outside climate.
Contact us today for more information, and to request your free quote.
