Grow Light Market Growing at a CAGR of 34.4% During 2016 to 2021 - ReportsnReports
PUNE, India, March 28, 2017 /PRNewswire/ --
The grow lights market was valued at USD 2.50 Billion in 2016 and is expected to reach USD 5.11 Billion by 2022, at a CAGR of 11.86 % from 2017 to 2022; Key factors for growth include growth in indoor farming practices, government initiatives while market is led by RoW.
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The grow lights market was valued at USD 2.50 billion in 2016 and is likely to grow at a CAGR of 11.86% between 2017 and 2022. The key factors driving the growth of the market include growth in indoor farming practices, government initiatives to encourage the adoption of solid state lighting (SSL) technology such as LED, and rising demand for energy-efficient and long lasting grow lights technology. However, the high costs of energy-efficient grow lights are restraining the growth of this market.
The major key players operating in the grow lights market include Royal Philips (Netherlands), General Electric Company (U.S.), Osram Licht AG (Germany), Gavita Holland B.V. (Netherlands), LumiGrow, Inc. (U.S.), Heliospectra AB (Sweden), IwasakiElectric Co., Ltd. (Japan), Illumitex, Inc. (U.S.), Hortilux Schreder B.V. (Netherlands), and Sunlight Supply, Inc. (U.S.).
Royal Philips (Netherlands) holds a leading position in the grow lights market and is a recognized brand in the lighting and illumination business; it offers a diversified product portfolio for horticultural applications. The company has developed innovative products to cater to the horticultural lighting markets by combining its expertise in lighting technologies with inputs from plant psychologists. Its products come in a variety of shapes, with a range of lumen outputs, which are offered at various price points to suit a wide range of growers from hobbyists to commercial growers. The company mainly focuses on partnering and collaborating with other companies to grow in the LED grow lights market. For instance, Philips partnered with Dummen Orange (Netherlands) in 2016. This partnership is expected to benefit both the companies to exchange information as well as conduct experiments to understand the effects of LED Lighting on a variety of red roses and other crops. Philips offers its horticultural lighting solutions in all the major markets across the world with the help of its global distribution and servicing capabilities.
This market is segmented on the basis of technology, installation, application, spectrum, and geography. The applications include vertical farming, indoor farming, commercial greenhouse, turf and landscaping, and research. Among all these applications, commercial greenhouse held the largest market share in 2016.
Commercial greenhouses have witnessed increased automation in the last decade, and the concept of controlled environment agriculture (CEA) is being implemented in the greenhouses to maintain optimum growing conditions and obtain a higher yield. The growers are gradually realizing the potential benefits of cultivating plants inside a greenhouse; this has contributed to the development of commercial greenhouses. LED grow lights can be easily programmed and integrated into the CEA setup within a greenhouse. Hence, growers with greater investment capabilities have started shifting toward LED grow lights from conventional lighting systems.
On the basis of technology, the grow lights market has been segmented into high-intensity discharge (HID), fluorescent lighting (FL), light emitting diode (LED), and other lighting technologies (induction and plasma lighting). Traditional lighting technologies such as high-intensity discharge (HID) and fluorescent lighting (FL) are quite popular among commercial growers as well as hobbyists. LED grow light is a new technology in horticultural lighting and is proving to be far more effective than other lighting technologies. Though LED grow lights are expensive, their long-term benefits in terms of energy efficiency make them an ideal option for indoor plant cultivation.
The market in RoW is expected to grow at a high rate between 2017 and 2022, owing to the increasing adoption of indoor farming practices especially in the Middle East and South American regions. The urban farming methodologies to meet the increasing demand for food and to mitigate the issues related to water scarcity and extreme temperatures have led to the increasing use of grow lights in this region. The grow lights market for vertical farming applications is expected to grow at a significant rate in this region in the near future. The Middle East and Africa hold a major share of the grow lights market in RoW.
The grow lights market, on the basis of installation, has been segmented into retrofit and new installations. The market for retrofit installations is likely to hold a larger market share in the coming years. In the context of the grow lights market, retrofitting is defined as removing an existing grow light and installing a new one, either of the same lighting technology or of a different lighting technology. New installations are generally characterized by the expansion of existing facilities or setting up of a new facility, such as a new greenhouse or a vertical farm.
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The initial capital required for the purchase of good-quality LED grow lights is higher compared to that of conventional lighting technologies such as FL and HID. This is mainly because each LED grow light unit contains arrays of LEDs, specially designed for horticultural applications. Often, these units contain different types of LEDs with variation in watts and wavelengths to provide a broad range of light spectrum and intensity for different types of plants. High-powered LED grow lights are available in the market for prices starting from USD 500. A high-powered induction grow light also costs USD 1,300 or more, whereas high-powered plasma grow light costs around USD 3,000. The costs of these grow lights are higher compared to that of a 1,000 watt HPS light, which costs between USD 100 and USD 150 and provides sufficient light for photosynthesis. This significant price difference is restraining the growers to adopt energy-efficient grow light technologies such as LED, induction lighting, and plasma lighting.
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