Key Opportunities and Challenges in the Smart Greenhouse Market

Key Opportunities and Challenges in the Smart Greenhouse Market

smart greenhouse market
The smart greenhouse market was valued at USD 1.12 billion in 2017 and is projected to reach USD 2.28 billion by 2023, at a CAGR of 12.6% from 2018 to 2023.

Will emerging vertical farming technology create opportunities in the smart greenhouse market? 

Vertical farming is the recent trend in the agriculture industry, especially in urban areas. Vertical farms are indoor farms in which plants are grown in stacks. These are highly optimized plant factories that use artificial lighting as the light source. These farms are designed to produce maximum yield in limited space while using climate control systems for maintaining optimum temperature to stimulate plant growth. In addition, growing crops indoor reduces the use of mechanical plows and other equipment, thereby lowering the combustion of fossil fuel. As a result, there will be a significant reduction in air pollution.

To make these farms cost-effective, smart greenhouses are used to improve energy-efficiency, increase lifespan, and supply desired light intensity for photosynthesis. The population in major cities is increasing at a rapid rate, fueling the demand for fresh fruits and vegetables. In the Netherlands, vacant office buildings are being converted into indoor farms to provide fresh fruits and vegetables and recover the investments on office buildings. Similarly, such trends are expected in other countries due to which vertical farming is expected to rise as a major industry in the coming years.

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How will integration of greenhouse technologies pose a challenge in the smart greenhouse market? 

Smart greenhouses are a combination of technologies such as HVAC, material logistics, sensors, and LED grow lights. The integration of all technologies in greenhouses is a challenge because different companies provide different attributes for a controlled environment. To make a smart greenhouse, companies need to work together and provide a controlled environment to produce maximum yields. Certhon (Netherlands) and Nexus Corporation (US), among others, provide commercial greenhouses. Other companies such as Logiqs B.V. (Netherlands) provide material handling logistics for smart greenhouses. It becomes challenging for commercial growers to receive components from all companies, integrate their technologies, and build smart greenhouses for high-yield production in the smart greenhouse market.


Smart farming is already in use through smart greenhouses, commercial growing techniques, and rooftop planting. Smart farming uses sensors, HVAC systems, irrigation and control systems, and logistics, among others, to track the growing stages of plants and provide them light and water accordingly. The use of technologies such as LED indoor farming creates a nature-like condition that enables farmers to meet the swelling demand for food.

Smart greenhouses are more expensive because they consist of many high-cost technologies, such as HVAC systems, control systems, automated logistics, LED grow lights, and sensors. The LED grow light is one of the major technologies used in smart greenhouses. This is mainly because each LED grow light unit contains an array of LEDs, especially designed for greenhouse applications, which increases the overall cost. Often, these units contain different types of LEDs having variations in watts and wavelengths, with a spectrum tailored for optimal plant growth in specific plant species. High-powered LED grow light systems are available in the market with prices ranging from USD 500 to USD 2,000. However, a high-quality full-spectrum LED grow light suitable for indoor growing can cost around USD 2,000 or more, depending on the power output and other features. Thus, the high capital cost of LED lighting systems is an important aspect delaying the establishment of LED technology in greenhouse lighting.

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