Grow Lights Market Overview
The global grow lights market generated revenue worth $2,653.2 million in 2016 and is expected to register a CAGR 12.5% during the forecast period (2017–2023). Major factors driving the market growth are the increased focus on indoor farming and vertical farming and growing government support toward the adoption of LED lights.
Based on technology, the grow lights market is categorized into light-emitting diode (LED), fluorescent, high-intensity discharge (HID), and others. Among these, LED grow lights held the largest share, accounting for more than 33%, in the market in 2016. This can be mainly attributed to the increase in demand for energy-efficient and economical grow lights among consumers and increasing government initiatives to boost the adoption of LED lights across the globe.
GLOBAL GROW LIGHTS MARKET, BY TECHNOLOGY, $M (2013-2023)
On the basis of application, the grow lights market is categorized into commercial greenhouse, vertical farming, indoor farming, research, and others. Among these, the commercial greenhouse category held the largest share in the market in 2016, which can be mainly ascribed to the rising urbanization and growing demand for consistent food supply in the world.
Europe led the grow lights market globally, accounting for 25.2% revenue in 2016. During the forecast period, the market is expected to witness the fastest growth in the Asia-Pacific (APAC) region. Surging population, increasing emphasis of regional governments on the adoption of LED lights, and growing focus on urban farming are the key factors driving the market growth in APAC.
Grow Lights Market Dynamics
The key trend observed in the grow lights market is the adoption of vertical farming techniques in urban areas. Vertical farming involves the use of lighting systems to stimulate the growth of plants indoors. These grow light systems provide artificial light in a controlled environment for plant growth. In this type of farming, plants are vertically stacked in layers for space optimization. Vertical farms use control systems for optimizing the conditions of cultivation and are designed specifically to increase crop capacity on a low surface area. Indoor vertical farming also reduces the need for toxic substances for pest control.
Increasing government support toward the adoption of LED lights is the key factor driving the grow lights market, globally. Governments and other international organizations are increasingly focusing on reducing energy consumption by encouraging transition toward LED lighting through various regulations and subsidies. Countries such as Brazil, Switzerland, Venezuela, Argentina, Australia, Canada, Russia, Malaysia, Mexico, and South Korea have already started phasing out incandescent light bulbs and replacing them with LED lights. Due to this, demand for LED grow lights for indoor farms is also increasing across the world.
Legalization of cannabis production in the U.S is a key opportunity observed in the grow lights market. For instance, in 2012, Colorado, U.S., legalized the production of cannabis for recreational purposes. Cannabis production in the U.S. has become a profitable option for the growers, on account of the increasing demand for cannabis across the world. Indoor production of cannabis can be carried out by either vertical farming or hydroponics. Since grow lights are largely used to support vertical farming, increased production of cannabis in the country is expected to offer lucrative opportunities to the players operating in the market.
Grow Lights Market Competitive Landscape
The global grow lights market is highly fragmented in nature, with players increasingly focusing on product innovation to meet the evolving needs of commercial and indoor crop growers across the globe. For instance, General Electric Company is heavily investing in product research and development to enhance its product offerings.
Some of the key players operating in the grow lights market are Koninklijke Philips N.V., Osram Licht AG, General Electric Company, Heliospectra AB, Dool Industries, Illumitex Inc., Gavita International B.V., Lumigrow Inc., Iwasaki Electric Co. Ltd., Sunlight Supply Inc., Hydrofarm Inc., and Fluence Bioengineering Inc.
Key questions answered in the report
What is the current scenario of the grow lights market?
What are the emerging technologies for the development of grow lights?
What are the major catalysts for the market and their impact during the short, medium, and long terms?
What are the evolving opportunities for the players in the market?
What is the fastest-growing regional market for grow lights across the world?
Which are the key regions from the investment perspective?
What are the key strategies adopted by the major players to expand their market share?