Europe held the largest share in grow lights market

Europe held the largest share in grow lights market, among all regions. This region has been using grow light systems for the past few decades to grow plants in commercial greenhouses. The use of grow light in this region is gradually increasing from being a supplemental lighting source to becoming the primary source of light in indoor operations. The population of Europe has expanded rapidly in recent times, and countries are importing fruits and vegetables in frozen form from the external markets in Africa and Asia. Indoor horticulture is gaining rapid momentum in some of the major countries in this region, to obtain fresh produce from locally cultivated farms. This factor is expected to generate massive demand for grow light systems in the future.

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Driver: Increasing demand for indoor farming in urban areas

Growing focus on infrastructural development and rising need to transform agricultural spaces into an abode for human living owing to the ever-growing population, especially in urban areas, has resulted in a scarcity of arable land, which, in turn, encourages growers across the world to adopt indoor farming technology. In this technique, plants are grown indoors by utilizing artificial light sources such as high-pressure sodium lamps (HPS), metal halide, and LED lamps. This allows regular plant growth without being much affected by environmental factors such as storms and extreme temperatures.

Restraint: High setup and installation costs

The initial capital required for the purchase of good-quality LED grow lights is higher than 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.

Opportunity: Rise of vertical farms

A recent trend in the horticultural industry is the emergence of vertical farms in urban establishments. Vertical farms are indoor farms wherein plants are grown in stacks one above the other, similar to a multistoried building. These are highly optimized plant factories, which make use of artificial lightings as the source of light and hydroponics for plant growth; the climatic conditions in these farms can be controlled artificially. Hydroponics is a method by which plants are grown without soil and are supplied with required minerals and nutrients by mixing them in water. These factors are beneficial for vertical farming, which eradicates the side effects of pesticides.

Challenge: Lack of standard testing practices for accessing product quality and their fixtures

The lighting technology industry is facing a major challenge, that is, the lack of standard testing practices for assessing the quality of products, especially for new technologies such as LED, induction, and plasma. Product quality needs to be assessed mainly to validate its lumen output and operating life. Manufacturers of LEDs have claimed the operating life of their products to be between 30,000 hours and 50,000 hours based on their research and testing for several years. However, every manufacturer has their own technique of manufacturing LEDs; hence, their testing practices also differ.

Market for new installations is expected to hold largest share during forecast period

The introduction of new grow light technologies such as LED, plasma, and induction has provided the growers with more options to choose from while retrofitting their grow light systems. LED grow lights offer variable spectrums that make them suitable for various plants. As a result, this technology is being preferred by the growers for most of the applications. New installations of grow lights are driven by the expansion of existing facilities and the construction of new facilities, such as commercial greenhouses or vertical farms.

Market for interlighting is expected to register a higher CAGR during forecast period

Interlighting is a relatively new concept in horticulture lighting. In this type of lighting, lights are placed inside the canopy of high-wire plants, which direct growth-stimulating light on the most vital parts of the crop, such as its leaves and veins. It has bidirectional lights that reduce shadowing of leaves, which occurs in the case of toplighting, ensuring lower parts of a plant are also exposed to adequate light. Interlighting provides greater light efficacy, which results in higher yield compared to toplighting as the design of interlighting allows a plant to absorb light rays from the entire spectrum.

Commercial greenhouse segment held the largest market share in 2019

Commercial greenhouses have witnessed increased automation in the last decade, and the concept of controlled environment agriculture (CEA) is being implemented in greenhouses to maintain optimum growing conditions and obtain a higher yield. 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.