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    Commercial Greenhouse Market Estimated to Grow at a CAGR of 11.9% During the Forecast Period 2021-2026
    (I-BusinessNews.Com, April 06, 2022 ) The commercial greenhouse market was valued at $29.9 billion in the year 2020 and is poised to grow at a CAGR of 11.9% over the forecast period of 2021-2026. Greenhouses are more often than not facilities catered by modern equipment and ancillaries to produce the intended crops or by-products. A commercial greenhouse can grow vegetables, trees, flowers, or shrubs with an efficient requirement of water, fertilizers, chemicals, and other necessary factors. A greenhouse environment can be created by using various coverings of various types. For example, polyethylene plastics are used by commercial greenhouses to cover the structures. The following structures cost less than the glass and are easy to install as well.



    Further advancement is seen in the form of polycarbonate plastic. The following uses a double wall made of polyethylene plastics. If this is maintained efficiently, a commercial covering such as these can last for at least ten years, and additionally, it can retain heat and humidity. Further down the line, methyl methacrylate monomer is being widely used to prevent the sheets from turning yellow, thereby maintaining visibility throughout. Moreover, the following sheet has been proven to have an increased life, be reusable, and also is an all-weather solution. Polymethyl or Acrylic has now been prevalently used in the industry owing to its rigidity. It has a textured surface, which makes the light defused and helps in preventing any condensation drip. Moreover, it is UV stabilized and has high impact resistance. The following factors, along with the resilience over finding better cropping methods will fuel the industry over the coming years.



    Commercial Greenhouse Market Segment Analysis- By Crop Type

    The commercial greenhouse market is segmented into three types based on the crop type, Fruits and vegetables, flowers and ornamentals, nursery crops, and others. Fruits and vegetables dominated the market segment in the year 2020. It is owing to the rising demand for food and the shrinking landscape. The increase in population directly leads to a rise in the number of hungry stomachs. As per the latest statistics, close to 200,000 people are added to the food demand each day. Other statics dictates that the land under production, which was 2200-meter square in 2005, will reduce to 1800- meter square by 2030. Hence, the demand for commercial greenhouses to supply the needful population has seen a prominent space in 2020. Additionally, the crop yield lost substantially to pest attack accounted globally for -10-16%, which can be significantly mitigated by using commercial greenhouses.



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    The demand for fruits and vegetables will see a lucrative CAGR rate of 12.2% over the forecast period of 2021-2026. It is attributed to the dynamic weather conditions now be visible in the majority of the regions. The dynamic shift in weather conditions spoils the overall yield of the crops. By adopting commercial greenhouses, the effect of such weather change can be significantly mitigated. To make the statement more factful, the vine crop productivity saw an increase of 200% as compared to the traditional methods. Additionally, the crop grown grows faster, which saves the incubation time for the next batch.



    Commercial Greenhouse Market Segment Analysis- By Greenhouse Type

    The commercial greenhouse market is segmented into two types based on the materials used in the construction, glass greenhouse, and plastic greenhouse. The plastic greenhouse dominated the market in the year 2020. It is owing to a comprehensive list of advantages it offers over glass-based. To start with, plastic is cheaper than glass, and hence if one is to utilize the economies of scale, they can use the plastics over the glass. The glass cost is close to $2.50 per square foot, while polyethylene typically costs $0.12 per square foot. Hence, a considerable cost gap can be seen in both types.



    The plastic Greenhouses will continue to grow at the swiftest CAGR of 12.4% over the forecast period of 2021-2026. Although the chances of wear and tear are higher in the case of plastics, the ease by which one can install a fresh piece is a driving reason for its growth. Another reason is that the sub-segment is seeing continuous technological advancement to make it more durable for it to withstand the dynamic climate change. Secondly, the breakage in glass would dent high replacement costs to the farmers or the cooperatives concerned.



    Commercial Greenhouse Market Segment Analysis- By Geography

    Europe held a dominant market share of 35% in the year 2020. It is predominantly owing to the government’s initiatives to increase the sustainability of food products using the right practices. Additionally, the European regions have problems associated with rainfall, and hence the water resources are not plenty which further asks them to use commercial greenhouses as they save water and provide other ecological benefits. As high as 11% of the lands present in Europe have a potential risk of abandonment, which account for around 20 million hectares. It is attributed to the growing modernizations and other factors listed above.



    North America shows an opportunity for lucrative growth in the commercial greenhouse market. Lately, the North American regions have been seeing a series of storms, heatwaves, and other natural calamities/ changes, which have been a prevalent reason for the spoilage of on-field crops. For example, the latest heatwave which struck Canada in the former half of the year spoilt the apple crop by up to 40%. Additionally, 54,000 kilograms of cherries were sunburnt. The following calamities will force the farmers to adapt to other methods such as commercial greenhouses.



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    Commercial Greenhouse Market Drivers

    Crop Yield from commercial greenhouses are higher than on-field yield, which will substantiate the demand for its usage.

    As per the various studies conducted by several researchers, it has been found that the average crop yield per acre can be 15 times more than the traditional on-field production. Moreover, the by-products produced by the commercial greenhouses have a higher marketable value than the on-field produce. For example, more than 90% of the yields from the commercial greenhouses can be marketed and sold in the open market, while the marketable yield remains sub-par or 40-60% in cases of on-field production. The prima facie case for such yield rates is due to the farmers' control factors when they opt for commercial greenhouses. The supporting elements such as temperature, water or irrigation, air humidity, and light can be controlled, which helps create products that have better marketable properties.



    Additionally, the crops grown in the controlled environment remain free of locusts or another harmful germicide that can spoil the crop. The water required to produce remains low, which helps the farmers and helps the world on the ecological front. The plant grown in the commercial greenhouses has improved genetics, which further helps in curating crops or products with healthier varieties. The following reasons will act as a driver for the commercial greenhouses market.



    An increase in the demand for floriculture and ornamental horticulture applications substantially increases the use of commercial greenhouses.

    A traditional shift has been seen in the use of flowers and its related usages across the regions. As per the Society of American Florists, people prefer to gift or receive flowers in any relations. The latter use, to receive flowers had a vote share of 65%. At the same time, people prefer to receive a gift which has in the type of flowers by 65%, as they believed that flowers convey a deeper meaning. With rapid innovation, growing preferences for flowers, and also the advent of online retail space, the need for flowers has seen a tremendous shift. Commercial greenhouses offer the flexibility to change the crop mix as per the demand trends. Floriculture with the use of commercial greenhouses provides an ideal environment for crop production. Farmer or cultivator has a better chance of avoiding any pest attack and also has greater control over the favorable climate conditions. Lastly, a farmer uses the correct practices for growing flowers, which saves the environment and increases the quality of the plants. Moreover, India exported a value of $75.89 million worth of floriculture products in the year 2019-2020, which is substantially more than the previous years.



    Commercial Greenhouse Market Challenges

    Slim profit margins for the operation of commercial greenhouses can prevent the market from growing substantially.

    Various cooperatives have been reporting a flat profit margin from the use of commercial greenhouses. The profit margin peaks at around 3.5% in suitable conditions, while the margins dip to 1% when the factors are unfavorable. The unfavorable conditions which cost the margin to go down are the inefficient heating systems. Owing to rapid climate change and a substantial increase of heat in the majority of the regions, the HVAC plants are required to work round the clock, which substantially takes portions of profits from the farmers. Additionally, the cost for acquiring commercial greenhouses can lie anywhere between $13000 to $25000, as the amenities, are on the higher end.



    Similarly, the materials used in making the structure can change the profit margins. For example, the use of plastics of various forms might be of lower rates than glass, and the depreciation costs weigh more. Hence, the margins earned over a period of year are used in upgrading the said coverings. If the crops are spoilt due to any malfunction of the stated features, the operating costs increase multi-fold, thereby hampering the profit margins. The following reasons can impede the market growth.



    Commercial Greenhouse Market Landscape

    The commercial greenhouse market believes that with the use of correct market strategies such as mergers and acquisitions, along with product launches or developments can help the industry move forward. The top 10 companies operating in the commercial greenhouse market are-



    Richel Group SA.

    Argus Control Systems Ltd.

    Certhon.

    Logiqs B.V.

    Lumigrow, Inc.

    Agra Tech, Inc.

    Rough Brothers, Inc.

    Nexus Corporation.

    Hort Americas LLC.

    Heliospectra AB.



    Market Developments

    In April 2020, Denso, a leading automotive technological supplier invested in Cethron Group to provide solutions pertaining to commercial greenhouses.

    In January 2020, a contract was signed between Madar Firms of UAE with Cethron. The following contract would allow the production of tomatoes in greenhouse setups and the produce will be distributed locally. The agreement also helps UAE in tackling food and water security challenges.



    Key Takeaways

    Europe had a dominant share in the commercial greenhouse market owing to its ready adoption of the technology and the substantial need for high yield crops.

    North America shows a lucrative opportunity to grow in the projected period due to the rising preference for using modern methods for production than the earlier traditional techniques.

    The premium report will contain strengths, weaknesses, opportunities, and threats analysis.

    Owing to higher yields than the primitive farming methods, the demand for commercial greenhouses will see a substantial rise.



    Related Reports:



    A. HVAC Equipment Market

    https://www.industryarc.com/Report/105/HVAC-Systems-equipment-Market.html



    B. Greenhouse Irrigation System Market

    https://www.industryarc.com/Report/15483/greenhouse-irrigation-system-market.html



    For more Food and Beverage Market reports, please click here



    About IndustryARC: IndustryARC primarily focuses on Cutting Edge Technologies and Newer Applications market research. Our Custom Research Services are designed to provide insights on the constant flux in the global supply-demand gap of markets. Our strong team of analysts enables us to meet the client research needs at a rapid speed, with a variety of options for your business. Any other custom requirements can be discussed with our team, drop an e-mail to sales@industryarc.com to discuss more about our consulting services.

    IndustryARC

    Venkat Reddy

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    venkat@industryarc.com

    Source: EmailWire.Com

    Source: EmailWire.com

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