Smart Greenhouses Market Size, Share & Growth Report | 2031

Report Description

The global smart greenhouses market size was valued at USD 1.68 Bn in 2022 and is likely to reach USD 3.77 Bn by 2031, expanding at a CAGR of 9.4 % during 2023 – 2031. The market's growth is attributed to the growing adoption of IoT-connected devices among farmers and increasing urbanization across the world.

The rising adoption of indoor farming in urban areas is estimated to boost the smart greenhouses market. Smart greenhouses are used to grow safe vegetables and fruits in limited spaces with limited footprint and maintenance. Smart greenhouses create microclimate a self-regulating technology suitable for plant growth through the use of actuators, monitoring, sensors, and control systems. These systems automate growth conditions and optimize the plant growing process in limited or indoor spaces.

• For instance, as per the report published by the World Bank, 4.4 billion people live in cities, which is 56% of the world’s population, and the number is expected to get double by 2050.

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Smart greenhouses stabilize the growing environment by protecting the plants from extreme cold and hot temperatures and buffering the ambient temperature. It is furnished with sensors that optimize plant growth by regulating humidity, light, and heat, which allows the crops to reach the harvesting stage faster whilst retaining as many nutrients as possible.

Growing adoption of IoT-connected devices among farmers propelled the demand for smart greenhouses. IoT - based smart greenhouse is a system built for monitoring the crop field with the help of sensors to automate the irrigation system, which helps farmers to monitor the field conditions from anywhere.

• For instance, 0.51 million Internet of Things (IoT) agriculture connections were present in European Union (EU) in 2016, which is expected to reach 70.26 million connections by 2025.

The smart greenhouse uses various microprocessors and sensors to perform functions such as controlling temperature and irrigation systems to enhance the productivity of the farmers and to produce better farming outcomes. The greenhouse system guarantees the food safety, quality, and traceability of vegetables with its self-managed vertical aquaponic system.

Impact of Artificial Intelligence (AI) on Smart Greenhouses

Artificial Intelligence is estimated to significantly boost the demand for smart greenhouses by enhancing their precision, efficiency, and sustainability. AI-powered smart greenhouse system monitors and adjusts environmental conditions such as humidity, light, and temperature, optimizing plant growth. Artificial intelligence algorithms predict disease outbreaks, automate harvesting, and manage irrigation by analyzing the data. Smart greenhouses associated with AI reduce resource waste, improve yield, and contribute to sustainable agriculture practices.

AI-powered robots and drones perform tasks like planting, harvesting, and pruning, which reduces the need for labor. It also assists farmers in genetic breeding by analyzing plant genomes and identifying traits to improve yield and resilience. AI-driven greenhouse system control irrigation systems based on weather forecasts and soil moisture, conserving water resources and preventing overwatering.

The COVID-19 pandemic hampered the global market. The disruptions in the supply chain due to preventive measures such as social distancing, and the imposition of lockdowns by governments all over the world, affected overall industries including the agriculture and farming industry. The agriculture industry saw a drastic downfall during the pandemic owing to a shortage of manpower and the closure of international borders. Thus, reducing the adoption of smart greenhouses systems among farmers. Moreover, the closure of hotels and restaurants lessens the demand for food items, significantly hindering market growth.

Smart Greenhouses Market Dynamics

Major drivers

Growing climate concern is expected to drive the market. Environmental and social determinants of health such as secure shelter, clean air, sufficient food, and safe drinking water are affected due to climate change. Smart greenhouses offer clean air and create healthy surrounding by reducing carbon emissions and food miles.

Increasing preference for organic food is anticipated to boost the demand for smart greenhouses. Smart greenhouses system is utilized for growing organic foods at home using minimal space. Smart greenhouses are automated farming system as it works on the sensors that enable automated monitoring of the farms. It offers farmers to grow fruits and vegetables, all around the year, with minimal effort.

• For instance, according to the Food and Agriculture Organization of the United Nations, 72.3 million hectares of agricultural land were managed organically by at least 3.1 million farmers in 2021 and is practiced in 187 countries.

Existing Restraints

High installation cost of smart greenhouses is expected to restrict the market growth. Smart greenhouses increase crop growth efficiency by utilizing several systems such as LED grow lights, HVAC, sensors, cameras, valves, pumps, and irrigation systems. These components are expensive which can hamper the market growth.

Emerging Opportunity

Increasing expenditure in R&D by major companies creates a lucrative opportunity in the market. Companies are investing in research & development activities to develop efficient and cost-effective products for smart greenhouses.

• For instance, On November 17, 2022, Certhon introduced SupriSun to give full control to farmers for the amount of light in the greenhouse. It is a new greenhouse concept with a special screen and dimmable LEDs to control the light optimally.

Growing trend of rooftop farming is expected to create immense opportunities in the market. Rooftop farming is widely adopted in urban areas and it uses green roofs, hydroponics, and aeroponics technique to grow plants. Thus, the rising adoption of rooftop farming creates an opportunity for smart greenhouses.

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Scope of the Smart Greenhouses Market Report

The report on the market includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.

Market Segment Insights

Type Segment Analysis

Based on type, the smart greenhouses market is bifurcated into hydroponic and non-hydroponic. The hydroponic segment accounted for a major market share in 2022 and is projected to grow at a robust pace during the forecast period as it offers enhanced crop yield. Hydroponic plants produce a greater yield of fruits and vegetables as in this system, plants are grown in nutrient-rich water with plenty of oxygen circulating their root systems. Moreover, plants do not need herbicides or pesticides in hydroponic as plants are grown in indoor spaces, which reduces the risk of pest infections. This system offers low installation cost and easy operation, which encourages farmers to adopt hydroponic techniques.

The non-hydroponic segment is expected to grow at a quick pace during the projection period as it does not require electrical power, mechanical aeration, or circulation of the nutrient solution. The entire crop is grown with only an initial application of water and nutrients through a non-hydroponic technique as plants are automatically watered, since the entire growing medium in the net pot formed moisture by capillary action. Plant growth enlarges moist air space by reducing the nutrient solution level and the root system continues to absorb water and nutrients.

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Covering Material Segment Analysis

On the basis of covering material, the global market is categorized into polyethylene and polycarbonate. The polyethylene segment held a large market share in 2022 owing to low cost and good light transmission. Polyethylene offers an ideal amount of sunlight, which is critical to the survival of plants in a greenhouse, by providing efficient light diffusion and UV protection as polyethylene is clear, durable, and resilient.

The polycarbonate segment is estimated to grow at a considerable pace during the projected period due to its potential ability to retain heat, which makes it a much more thermally efficient solution keeping the structure cooler in the summer and warmer in the winter. Moreover, it reflects away harmful UV radiations, protecting plants and extending their life span. Additionally, polycarbonate sheets are shatterproof so won't crack like glass panes, which eliminates any accidents happening in smart greenhouses, thus propelling segment growth.

Component Segment Analysis

In terms of component, smart greenhouses are segregated into LED grow lights, HVAC, material handling, control systems, sensors & cameras, valves & pumps, and irrigation systems. LED grow lights segment dominated the market share in 2022 owing to peak productivity by providing the exact amount of light required for plant growth. The LED grow lights allow a highly controlled environment for plants, reducing the need for pesticides and chemical treatments on plants and lowering environmental impact. LED lights help scale plant production by providing a full light spectrum, low heat waste, and extended lifespan, resulting in boosting demand for LED grows lights.

HVAC segment is anticipated to grow at a significant pace over the projected period due to regulating temperature for optimal plant growth. The heating, Ventilation, and Air-Conditioning (HVAC) system is utilized to maintain an optimum temperature within a controlled environment. HVAC creates the ideal temperature for plant growth by nullifying the adverse impact of changes in the external temperature and enabling cultivation throughout the year. These benefits linked to HVAC are estimated to propel segment growth.

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End-User Segment Analysis

Based on end-user, the global market is divided into commercial growers, research institutes, retail gardens, and others. Commercial growers segment accounted for a major market share in 2022, and are estimated to grow at a considerable pace during the forecasted period owing to the increasing adoption of greenhouses in the commercial sector. Commercial growers are adopting smart greenhouses as it offers increased production of plants and vegetables, which commercial growers sold for commercial consumption and generate revenue.

The research institute segment is expected to grow at a high CAGR during the assessment year due to ongoing R&D for identifying, improving, and promoting new development in smart greenhouses. Research institutes are continuously adopting smart greenhouses techniques to gain insights into new development in greenhouses. For instance, the International Journal of Creative Research Thoughts conducted a study on IOT-based smart greenhouse automation to provide solutions to field activities and irrigation problems.

Regional Outlook

In terms of region, the smart greenhouses market is categorized into Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. Europe held a large market share in 2022 and is anticipated to grow at a considerable CAGR in the coming years owing to the technologically advanced agriculture industry and the presence of establishes companies such as Certhon and Cultivar Ltd. Moreover, growing number of Internet of Things (IoT) active connections in the agriculture sector is expected to create new opportunities for the market in the region.

• For instance, according to the data from ETNO and IDATE DigiWorld, the number of Internet of Things (IoT) active connections in agriculture in the European Union (EU) is reported to have increased from 0.51 million in 2016 to 70.26 million by 2025.

Asia Pacific is estimated to witness a high CAGR growth over the projected period due to the rising adoption of smart farming techniques. The rising population in the region propelled the need for food security, significantly boosting the demand for smart greenhouses. Moreover, increasing agricultural trade in the region is estimated to encourage farmers to adopt smart greenhouses as it increases crop production by controlling factors like temperature, sunshine, fertilization, and irrigation.

• For instance, according to data published by Population Reference Bureau (PRB) on February 9, 2023, India's exports of agricultural and processed food products increased by more than 13% to USD 19.69 billion from April 2022 to December 2022 compared to the same period last year.

Additionally, growing government-favorable initiatives like schemes and programs in the region are estimated to encourage farmers to adopt smart greenhouses technology. For instance, Government of India introduced National Horticulture Mission (NHM), to offer subsidies ranging from 50% to 100% for the setup of Polyhouses/ Net houses/Greenhouse.

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