The Hydroponics Market is estimated to be valued at US$ 467.17 Mn in 2023 and is expected to exhibit a CAGR of 10% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Hydroponics is a technique in which plants are grown without soil by using mineral nutrient solutions in an water solvent. Hydroponics provides several advantages over traditional soil-based agriculture such as higher yield, no standard growing season, more control over nutrition and less pest problems. Hydroponic systems are widely used for commercial production of leafy greens, tomatoes, cucumbers and peppers.
Market key trends:
Hydroponics is gaining popularity for commercial vegetable production owing to increasing demand for fresh and pesticide-free produce. According to a study, hydroponically grown vegetables contain higher amount of essential nutrients as compared to traditional soil-based agriculture. Hydroponic farming is also more environment-friendly as it utilizes 90% less water than conventional farming practices. Moreover, hydroponics allows year-round production and higher yields even in limited space. With growing global population and decreasing arable land, hydroponics provides a sustainable solution for commercial vegetable cultivation. Various technological advancements in hydroponic farming equipment such as nutrient film technique (NFT) and deep-water culture (DWC) systems have increased food production efficiency.
Porter’s Analysis
Threat of new entrants: Low-moderate threat of new entrants as hydroponics farming requires high initial capital investment for setting up farms and infrastructure and access to technology and skilled labor. However, growing demand presents opportunities.
Bargaining power of buyers: Moderate bargaining power of buyers as customers have several vendors to choose from but demand is concentrated among large retailers and distributors.
Bargaining power of suppliers: Moderate-high bargaining power of suppliers as production inputs like growing mediums, lighting solutions, and nutrients are specialized requiring technical expertise. Suppliers can influence prices.
Threat of new substitutes: Low threat as hydroponics offers higher yields, is more sustainable and environment-friendly compared to traditional farming.
Competitive rivalry: High as the market is growing attracting many new players globally offering similar products and customization leading to pricing pressures.
SWOT Analysis
Strengths: Higher yields and productivity. Uses 90% less water. Reduced usage of pesticides and fertilizers making it sustainable. Greens can be grown throughout the year.
Weaknesses: High initial investment costs. Reliance on technical skills and knowledge. Issues with lack of standardization.
Opportunities: Growing demand for pesticide-free foods. Large untapped markets in developing nations. Advancements in IoT and sensing technologies.
Threats: Vulnerability to disease outbreaks without proper safety protocols. Stringent regulations around usage of LEDs and nutrients. Supply chain disruptions due to pandemic.
Key Takeaways
The Global Hydroponics Market Size is expected to witness high growth, exhibiting CAGR of 10% over the forecast period, due to increasing demand for pesticide-free foods and sustainability practices in agriculture. The Asia Pacific region dominates the market currently due to large cultivable land, favorable climate, and low labor costs in countries like China, India, and Japan promoting hydroponic farming adoption.
Regional analysis: The Asia Pacific region is the fastest growing as well as the largest hydroponics market currently. China dominates owing to large indoor vertical farming projects boosted by government initiatives and investors. Japan and India are other major markets in the region driven by growing middle-class and demand for fresh produce.
Key players operating in the hydroponics market are Argus Control System (Canada), Koninklijke Philips NV (The Netherlands), Greentech Agro LLC (U.S.), Biodynamic LLC., General Hydroponics, Inc., Logiqs B.V. (The Netherlands), Lumigrow, Inc. (U.S.), Hydrofarm Inc., Hydrodynamics International Inc., Heliospectra AB, Village Farms International, Inc., Platinum Produce Company and Millennium Pacific Greenhouses Ltd, and Soave Enterprises LLC.
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