While Yole sees the current business mostly driven by greenhouse applications and incumbent technologies (92% and 79% in revenue, respectively) during 2017, the transition to LED technology and the emergence of new applications will expand the market’s size.
In its report "Horticultural LED Lighting: Market, Industry and Technology Trends" Yoles sees this market reaching nearly US$8.6 billion in 2022.
than US$17 billion in 2027”, comments Pierrick Boulay, Technology & Market Analyst at Yole.
At the LED device level, market opportunity represents almost US$100 million in 2017 and should grow to about US$400 million in 2022, eventually reaching US$ 700 million in ten years' time.
The LED lighting industry sees horticultural lighting as a new opportunity for which to develop high added-value products with greater margin levels. In Q4/2017, Yole identified less than 50 players as offering dedicated LED-based systems. The industry is highly concentrated in North America with a 50% market share (number of companies involved), the result of medicinal cannabis’s legalization.
“Looking ahead, industry evolution will strongly depend on market dynamics,” explains Joel Thomé, PISEO’s CEO. “Indeed, industrial players’ marketing and communications are currently focused on two main applications including medicinal plants (mostly cannabis) production, which is today the main market driver and vegetable production, which is developing with a “low-end / high-volume products” focus.”