Editor's Note: This article originally appeared in the September/October 2025 print edition of Produce Grower under the headline “Road to the top.”
Photo © Adobestock
The growth of the CEA industry has been full of twists and turns. In its relatively short history, there has been a glut of tech investment startup money, followed by contraction and some unfortunate closures. There has been both wild hope and crushing doubt. But our 2025 State of the CEA Produce Industry Report seems to suggest that for some in the industry, the winding road has become a straighter highway to the top.
Not only do our reader respondents report more profit than loss and more growth than contraction, but they also point to increased consumer demand as the prime driver. That means that more companies are reporting less reliance on outside funding, pointing toward an industry pulling in enough money to invest in itself to meet that increasing demand with more product and higher quality.
Survey methodology:
In August 2025, Produce Grower surveyed 37 of our most engaged readers who are growers and operators with produce production under cover.
Editor’s note: Not all percentages add up to 100% due to rounding, non-responses and some questions allowing respondents to select multiple answers.
Who took our survey?
Responding growers represented nearly all areas of Produce Grower magazine readership, with the exception of the Rocky Mountain region. But the robust CEA industry of the United States’ northern neighbor (which makes growing year-round fresh produce in colder climes much easier) means a quarter of respondents hail from Canadian provinces. And while the total reporting cohort is an intimate group, they represent a great deal of experience, with nearly 90% in business for four or more years and more than half of all respondents having been in business for more than 10 years.
Of the crops in production, leafy greens and tomatoes edge out lettuce, herbs and peppers as the most grown crops. Less represented but still strongly reported crops include cucumbers (30%) and microgreens (22%). Mushrooms are the least-reported crop at 3%. Berries are widely reported as an additional crop, along with vegetable seedlings, for commercial farms.
When looking just at those businesses that have been operating for more than 10 years, there is a shift in the most represented crops. Over half of these growers have staked their claim in herbs. Peppers and tomatoes are the next most-represented crop (both 48%).
Nearly half of all reporting growers have between 10,000 and 99,000 square feet of under-cover growing capacity. But about 20% report a smaller capacity between 5,000 and 9,999 square feet.
Growing up The headline for the industry when it comes to growth is that over a quarter have increased growing capacity, while nearly three-quarters increased production. The reason? The vast majority of respondents (84%) point to increasing market demand. Fewer, though still a significant number, report the expansion of capital availability and new technology (19% and 16%, respectively).
That said, increases in production are relatively modest, with most reporting production growth under 25%. Those who have been in business for more than 10 years are most likely to report increases in production.
For all those reporting increases in production of any percentage, the crop representation changes. That implies more robust growth in leafy greens (42%), as well as lettuce, tomatoes, peppers and herbs (all 38%).
Crop representation changes yet again for those who report expanding market demand as the primary driver of their growth. For these growers, the most common crop is leafy greens, followed by lettuce, tomatoes, peppers and herbs (in that order).
The data, then, seem to suggest that leafy greens are driving growth across the CEA industry compared to other crops.
But what about the small minority that reported decreases in production? All of these growers report tomatoes and cucumbers as their main crops — and nearly 70% call out contracting labor availability as the main driver.
Crop cash The anticipated sales volume for 2025 is split nearly cleanly on the $1 million line. While 51% expect a sales volume below that line, 49% expect a sales volume above that line. Of those who expect the volume to exceed $1 million, a little over half expect it to be below $3 million. Of those anticipating even higher volume, well over half expect it to be $11 million or more. These numbers become clearer in context of respondents’ reported sales trends. As many growers reported year-over-year sales increasing above 5% as those who reported flat sales (43% each). Far fewer reported sales declines (14%).
Anticipated 2025 profits are also a bright spot. About three-quarters of those who participated in our survey said they would see profits, while 38% said that they would break even. Of those reporting profits, about half are distributed between 3% and 14%.
So, what’s keeping CEA operations from seeing bigger profits? When asked about the three biggest factors affecting profits, the top answers are not unexpected. Labor is the top factor, with energy and input costs tied for the second spot, followed by shipping and logistics. These trends remained when growers were asked to name the one thing that, if fixed, would improve profits. But there were a few answers unique to the current moment, including uncertainty around tariffs and changing weather.
Market perspectives with Luis-Gabriel Forero, head grower at Sunterra Greenhouse Sunterra Greenhouse , located in Acme, Alberta, Canada, produces tomatoes and strawberries in 20 acres under glass. That translates to more than 1 million pounds of tomatoes and more than 130,000 pounds of strawberries harvested each month.
Produce Grower:
Luis-Gabriel Forero: Buy Canadian (has been working) great for us, and we are selling tomatoes across all provinces in Canada.
PG: Are you noticing any shifts in crop selection within CEA in general or within your own business?
LGF: Yes, in general, tomato varieties (depending on which class, such as TOV, grape, beef, etc.) are (becoming) more of a commodity than a specialty for buyers.
PG: What are your biggest operational cost drivers, and how are you addressing them?
LGF: Labor and electricity (are the biggest operational cost drivers). We’re addressing labor by offering incentives as bonuses for high performers, and we’re addressing electricity by the use of COGEN (cogeneration).
PG: Describe a win (or wins) you experienced this year with your business.
LGF: We have a good sales team, good performers and a clean crop with zero quality claims the entire season!
Market perspectives with Tracy Nazzaro, president and general manager at Traders Hill Farm Traders Hill Farms is an aquaponics operation that provides organic lettuce and tomatoes to retailers, restaurants and families across northeast Florida and southeast Georgia. The company is Safe Quality Food Level 3 certified.
Produce Grower: What trends in consumer demand (buy local, year-round supply, etc.) are impacting your business the most right now?
Tracy Nazzaro: Local continues to be a big winner, and CEA companies should use it to their advantage. I believe strongly in the “Fresh From Florida” and “Georgia Grown” state marketing programs. I believe that consumers in those states are quite loyal to supporting these initiatives.
PG: What are your biggest operational cost drivers, and how are you addressing them?
TN: Labor is by far and away the biggest expense item, followed by packaging, then utilities. We are in the process of reviewing all our operating protocols to see where we can become more “lean.”
PG: Describe a win (or wins) you experienced this year with your business.
TN: Our demand continues to grow. We have a strong sales channel with K-12 and higher education, which is an important market to me personally.
PG: What is your top business challenge currently?
TN: Managing expenses, followed by securing investment capital to expand production.
Patrick Alan Coleman is editor of Produce Grower magazine. Contact him at pcoleman@gie.net .
