Horticulture Lighting Market Overview, 2024-2029

The global horticulture lighting market is undergoing a sea change in terms of demand for more sustainable, efficient, and innovative lighting solutions. From a mere sectorial area within agricultural technology, the attention has accrued to horticulture lighting a notch higher after growers became increasingly concerned about the environment and growing conditions that result in optimal output of plants. Some of the factors driving this evolution in this market include advancements in lighting technology and encouraging policies by the government towards sustainable agriculture, coupled with an increasing focus on optimization of crop productivity and quality.

One of the distinguishing features of the global horticulture lighting landscape is that regional leaders are now emerging. Indeed, while established giants in lighting from the developed world expand their offerings in horticulture, regional players have been able to establish particular niches for themselves. Regional leaders are able to draw on deep knowledge of local agricultural dynamics, prowess at negotiating regional regulatory landscapes, and strong commitments to sustainable practices in conjunction with regional environmental goals.

Their emergence has enriched the global horticulture lighting market, making it more competitive, challenging established multinational corporations, and providing a better, diversified setting. The success comes from fulfilling regional needs, overcoming local challenges in logistics, and offering solutions that dovetail with the local preferences and sustainability goals of growers. For instance, companies in regions like Europe and North America are currently working on energy-efficient LED grow lights for indoor farming in urban settings, solving the need for sustainable agricultural practices amidst pressures for urbanization.

According to the report, the market is anticipated to cross USD 18 Billion by 2029, increasing from USD 6 Billion in 2023. The market is expected to grow with a 20% CAGR from 2024 to 2029. The growth represents huge potential as driven by rising agricultural productivity demands and imperatives for sustainable agriculture among different regions across the world. The innovative startups further change the face of horticulture lighting through perceptual specialization at fronts such as sustainable lighting solutions, advanced spectral tuning for optimized plant growth, new financing models like lighting-as-a-service, and challenging traditional practices that put pressure on established manufacturers to embrace innovation.

This leads to a more highly dynamic and responsive market environment. The global horticulture LED lighting market has observed several strategic alliances between company profiles to launch new products with added functionalities and maintain revenue share & profitability. Organic and inorganic growth strategies adopted by small players have been the highlight of this market. In the horticulture lighting ecosystem, after-sale support services have shown considerable growth, where companies are working on the development of digital platforms and software aimed at optimizing lighting supply chains, monitoring crop performance, and improving operational efficiencies.

Regulatory bodies are also developing standards and guidelines to promote compliance and environmental stewardship within this industry. The global horticulture lighting market is driven by certain very successful collaborations, which in turn create innovation and technological development. Lighting manufacturers and agricultural businesses, along with research institutions, have come forward to develop high-end lighting technologies. Included therein are smart lighting systems equipped with sensors that monitor in real-time the status regarding the health and growth determinants of plants. Advanced materials are used during light fixture designs, such as recyclable LEDs and biodegradable components.

Market Drivers

• Technological Integration and Automation: The integration of advanced technologies such as IoT, AI, and robotics in horticulture lighting systems is a significant driver. These technologies facilitate automated monitoring and control of lighting conditions, enhancing precision and efficiency in crop production. IoT devices can collect data on light intensity, plant health, and environmental conditions, which AI algorithms analyze to optimize lighting schedules and spectra. Automation reduces labor costs and human error, making horticulture lighting systems more attractive to large-scale and commercial agricultural operations looking to increase productivity and profitability.

Market Challenges

• Price Pressure: The horticulture lighting market is highly competitive, with numerous manufacturers striving to innovate and reduce costs. This intense competition can lead to price pressure, making it challenging for companies to maintain profitability while investing in research and development. Smaller players, in particular, struggle to compete with established firms that can afford to offer lower prices due to economies of scale. Navigating this competitive landscape requires continuous innovation and strategic partnerships to differentiate products and sustain market share.
• Environmental Concerns: While horticulture lighting contributes to sustainable agriculture, it also raises environmental concerns related to electronic waste and the lifecycle of LED products. The production and disposal of LED lighting systems involve materials that can be harmful to the environment if not managed properly. The energy consumption of large-scale horticulture lighting installations, even with efficient LEDs, can contribute to carbon emissions if the electricity is sourced from non-renewable energy.

Market Trends

• Customization and Crop-Specific Solutions: A growing trend in the horticulture lighting market is the development of customized lighting solutions tailored to specific crops. Different plants have unique light requirements in terms of spectrum, intensity, and duration to optimize their growth and yield. Manufacturers are increasingly offering crop-specific lighting systems that cater to these precise needs. This trend is driven by advances in plant science and the ability to fine-tune LED technologies to deliver the exact light spectra required for different stages of plant growth, from seedling to harvest.
• Expansion into Emerging Markets: The horticulture lighting market is expanding beyond traditional strongholds of the regions offer significant growth potential due to rising food demand, increasing awareness of sustainable farming practices, and supportive government policies. Companies are investing in these markets by establishing local partnerships, adapting products to regional needs, and providing education and training to farmers. The expansion helps address global food security challenges and supports economic development in these regions.

High-intensity discharge lighting grows in the global horticulture lighting market due to its effective in delivering intense light, which is suitable for promoting robust plant growth in large-scale and commercial agricultural operations.

HID lighting, which includes high-pressure sodium and metal halide lamps, has been an integral part of the horticulture industry for some time now, particularly since they produce high-intensity light that allows for strong growth and maximum yields. Such lighting systems, in particular, favor big farms in commercial agriculture where it is all about high productivity. Due to their high lumen output per watt, HIDs have been employed in service to illuminate vast areas, such as greenhouses and indoor farms. T A key reason sited to justify their continued use involves the spectral qualities of the HID.

The light spectrum that HPS lamps give off, rich in red and orange wavelengths, is very useful during the flowering and fruiting stages of a plant's life. This spectral output helps increase the quantity and quality of the produce, hence making HPS lights one of the preferred options for many commercial growers whose crops include flowering plants and fruit-bearing species. The MH lamps, give off a balanced spectrum that is rich in blue light which is important during the vegetative growth phase of the plants. It aids in developing strong stems with healthy leaves. HIDs are still desired very much due to the invention of new technologies like LEDs since they are cost-effective in terms of their initial setup.

Growth of HID lighting in horticulture is also fostered by the fact that it offers flexible and scalable systems for really small areas implemented by hobbyists and large commercial operations. Technological innovations in HIDs have constantly enhanced energy efficiency and light output. Enhanced ballast design and improved bulb quality are some of the technological steps forward that revamped the performance of HID technology, making it better than the new technologies in certain aspects.

The interlighting is in growing demand within the global horticulture lighting market is due to its direct light to the lower canopy and inner parts of plants, thereby maximizing light utilization efficiency to bring forth crop yield and quality.

Interlighting has been touted as one of the major trends in the global horticulture lighting market because it offers what no other lighting technology does: light from within the plant canopy. Unlike traditional top lighting, which projects light over the plants from above, interlighting fittings are mounted between rows or right inside the crop canopy, rendering light at the places most needed - onto the lower leaves and inner parts of plants. Such a strategy improves light penetration and distribution within the plant canopy, where even parts of the plant can obtain sufficient light for photosynthesis and hence growth. Providing an elevated level of light use efficiency is one of the prime benefits provided by interlighting.

This is achieved through locating the lighting closer to the plants and directing it in some areas within the canopy reducing energy loss due to wasted light. The feature becomes especially useful in commercial greenhouse operations where there is a need to maximize crop yields relative to the amount of energy input in order to guarantee a profitable business. This concentrated light distribution will reduce the shading effect within the crop, therefore enhancing uniformity of growth and development throughout the plant.

The number of crops that have dense canopies or are variably profiting from enhanced light penetration, including tomatoes, cucumbers, and peppers. The crops are capable of showing improved fruit set, larger fruit size, and increased production under optimum light conditions imparted by interlighting systems. The personalization of light spectra and intensity adds to its usability, whereby adjustment of lighting strategies can be designed in relation to specific crop needs and growth stages.

The floriculture growth in the horticulture lighting market globally can be attributed to, resulting from the need to continuously supply produce of high-quality flowers.

With increasing disposable incomes and the popularity of gifting and decorative flowers among the urbanized population, interest in flowers has risen rapidly, resulting in constant and reliable fresh quality flowers in high demand. Most growers and large-scale, commercial flower producers turn to advanced horticultural lighting solutions particularly LED to help satisfy demand by allowing continuous production throughout the year and yielding premium flowers.

With LED lighting systems, it is possible to control light spectra, intensity, and duration for producing either artificial versions of natural conditions or establishing custom light recipes dependent on the type of flower grown or phase of growth. Manipulation of light conditions can generate the physiological attributes related to flowers that the grower desires to attain, such as vibrancy of color, lengthening of stems, and extension of vase life. The qualities are highly corporate in floriculture, where aesthetic and longevity factors are taken to be key determinants for consumer satisfaction and gaining a competitive advantage in the market.

It is for these reasons that recently, much consideration has been given to LED lighting solutions by any commercial flower grower in the quest for energy efficiency and long service life: they can successfully help reduce energy use and operational costs for any operation of a grower while providing uniform and controlled lighting conditions to optimize the processes of production and improve profitability in general. The increasing the trend towards sustainable living or green living has supported the adoption of horticultural lighting solutions in floriculture. LED grow lights contribute to a lowered carbon footprint of flower production by reducing energy consumption and efficient usage of resources in CEA systems like greenhouses and vertical farms.

The vertical farming segment is rising in the global horticulture lighting market, driven by surging demand for sustainable and space-efficient systems of food production within urban areas.

A huge area that has automatically gained unstoppable momentum globally to counteract the problems caused by urbanization, scarcity of arable land, and demand for more sustainable food production is vertical farming, otherwise known as farming in vertically stacked layers or on vertically inclined surfaces. This new approach to cultivation created new market demand under horticultural lighting solutions, within which LED technology assumes an important role in allowing and optimizing the functioning of vertical farming systems. Plants in vertical farms are grown within a building, completely controlled, with photosynthesis and growth dependent only on artificial lighting.

LED lighting systems have become very popular due to the advanced control they provide over the spectra, intensity, and distribution of light. It is the possibility of controlling light conditions for different crop types at various growth stages that growers are better positioned to optimize growth, enhance yield, and promote certain crop quality attributes such as color, flavor, and nutritional content. The compact, modular LED light fixtures prove to be very useful in vertical farming setups. Some arrangements of LED lights would then illuminate many layers of growing with uniform light distribution, maximizing the use of limited floor space while ensuring reduced energy consumption and heat output. It is further observed that energy efficiency and long-term operation of LED lighting solutions go a long way in making vertical farming operations sustainable and cost-effective.

The increasing share of the APAC region in the global horticulture lighting market is supported by controlled environment agriculture practices for more and more types of cultivation, which increase demands for year-round crop production and advancing LED technology.

Massive adoption of controlled environment agriculture practices is one of the major drivers across countries like China, Japan, South Korea, and Australia. CEA refers to growing crops with horticulture lighting and with in-house control of temperature, humidity, and CO2. The technology will help farmers in the APAC region produce crops more sustainably without having to face demanding climatic conditions, a shortage of land, and urbanization to ensure continuous and high-quality crop yields throughout the year. Horticulture lighting technologies, particularly LED systems, give growers an extended season, shorter crop growth cycles, and adaptation of crops that would otherwise not be viable in specific climates.

This ability to continually produce fresh and local produce is an attribute that continues to attract consumers and drive the establishment of sustainable agriculture practices in APAC urban centers. A second key driver for the APAC horticulture lighting market is innovative developments in LED technology. Having better energy efficiency, longer lifetimes, and the capability to tailor light spectra for specific plant growth, LEDs outshine conventional lighting technologies in many ways.

Manufacturers and research institutions from APAC have been quite comfortable at the forefront in developing and refining LED lighting solutions for plants, depending on crop needs and growing environments. Many continuous innovations in LED technology help improve the efficiency and affordability of horticulture lighting systems, thereby fueling further adoption across the region. Government policies and steps in support of fostering sustainable agriculture and technological innovation have boosted the growth pace of the horticulture lighting market in APAC.

• In June 2023, ams-OSRAM AG. 's fifth-generation OSLON Square Hyper Red LED achieves a market-leading wall plug efficiency of 78.8%, reducing energy consumption and costs for indoor crop growth. With a remarkable Q90 lifetime of 102,000 hours and high durability, it reinforces its leadership in horticulture lighting.
• In June 2023, Signify Holding, a global lighting leader, aided Topline Gerbera Nursery in transitioning from HPS to full LED lighting. The Philips GreenPower LED toplighting system provided enhanced illumination while significantly reducing energy consumption, enabling year-round usage. It reduces electricity consumption by 40%.
• In March 2022, Acuity Brands announced the launch of Verjure, a professional-grade horticulture LED lighting solution that offers productive and consistent performance for indoor horticulture applications. Developed using academic, plant-based research, the Verjure Pro Series LED luminaires are designed to support all stages of plant growth from veg to flower. The Series is available in three different sizes and outputs to support versatility in growing, including indoor warehouse, greenhouse, and vertical racks.
• In December 2021, Signify and Osram ventured into a joint project for the horticulture lighting market

Years considered in this report:

• Historic year: 2018
• Base year: 2023
• Estimated year: 2024
• Forecast year: 2029

Aspects covered in the report:

• Horticulture Lighting market outlook with its value and forecast, along with its segments
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Technology:

• Light-emitting Diode (LED)
• High-intensity Discharge (HID)
• Fluorescent
• Others

By Lighting Type:

• Toplighting
• Interlighting

By Application:

• Fruits & Vegetables
• Floriculture
• Cannabis

By End-use Industry:

• Greenhouses
• Vertical Farming
• Indoor Farms

The approach of the report:

This report consists of a combined approach of primary and secondary research. Initially, secondary research was used to get an understanding of the market and list the companies that are present in it. The secondary research consists of third-party sources such as press releases, annual reports of companies, and government-generated reports and databases. After gathering the data from secondary sources, primary research was conducted by conducting telephone interviews with the leading players about how the market is functioning and then conducting trade calls with dealers and distributors of the market. After this, the research team made primary calls to consumers by equally segmenting them in regional aspects, tier aspects, age group, and gender. Once the research team attained the primary data, they verified the details obtained from secondary sources.

Intended Audience

This report can be useful to industry consultants, manufacturers, suppliers, associations, and organizations related to the Horticulture Lighting industry, government bodies, and other stakeholders to align their market-centric strategies. In addition to marketing and presentations, it will also increase competitive knowledge about the industry.