After going through high mountains and troughs, how is the progress of LED plant lighting companies?

Plant lighting has become one of the most popular lighting subdivisions in recent years, and many lighting industry chain companies have entered the industry. However, after experiencing the rapid growth of the plant lighting market driven by cannabis cultivation in North America in 2020, starting from the second half of 2021, the demand for plant lighting has continued to decline due to factors such as shipping and the crackdown on illegal cannabis cultivation.

So, how has the market been trending over the past year? After experiencing significant market fluctuations, how do industrial chain companies upgrade their plant lighting business, gain a foothold in the increasingly competitive plant lighting market, and welcome the arrival of greater business opportunities in the future?

Demand for plant lighting is gradually picking up, and North America and Europe are still the main sources of orders

After experiencing sluggish demand in the second half of 2021, the plant lighting market is gradually picking up. Although market demand is not as hot as the same period last year, in the first half of this year, industry chain companies still achieved a relatively stable recovery growth in the plant lighting business.

LED chip company Huacan Optoelectronics said that after the demand for plant lighting market slowed down in the second half of last year, the demand has gradually picked up from the bottom in the first half of this year. Downstream customers are optimistic that the plant lighting market demand will continue to pick up in the second half of the year. Feedback from some downstream chip companies on the plant lighting business also verifies the fact that market demand is gradually picking up.

In terms of packaging companies, Luminus, Tiandian Optoelectronics, Lideda, and Jinko Electronics all said that the company's plant lighting business is gradually growing, and demand mainly comes from the cannabis cultivation market in North America and Europe. Orders from the Thai cannabis cultivation market have also begun to gradually increase. Jinko Electronics stated that the demand for plant lighting applications has the same cyclicality every year. Among them, the first and fourth quarters are the low demand seasons, and the second and third quarters are the peak seasons. Therefore, downstream demand is strong in the second quarter, and Jinko Electronics' orders for plant lighting products begin to increase.

Power supply company Mosuo Power said that the company's plant lighting business orders continue to grow, and demand comes from the company's major customers.

Lighting company Signify also pointed out in its first-quarter financial report that the strong performance of its plant lighting business in the United States drove its digital solutions business's sales to increase by nearly 24% in nominal terms.

It is worth noting that Signify completed the acquisition of plant lighting manufacturer Fluence in May. This transaction has begun to have a positive impact on the growth of Signify's performance. In the second half of the year, as the demand for medical cannabis in North America continues to grow, Fluence's revenue is expected to increase.

Judging from the market situation in the first half of the year, in the short term, the main demand for LED plant lighting still comes from cannabis cultivation in North America and the greenhouse market in Europe. In addition, after the legalization of cannabis cultivation was announced in June, the demand for plant lighting from Thailand has also gradually increased.

In the long term, due to problems such as food supply shortages and land resource constraints in the context of global population growth, as well as the continuous optimization of plant lighting technology and costs, the demand for plant lighting in plant factories and greenhouse agriculture will continue to increase.

TrendForce's "2022 Global LED Lighting Market Analysis Report-2H22" points out that despite the slowdown in the legalization of cannabis in North America and the sharp decline in the market in China, the growth rate of the plant lighting market has slowed down. However, in response to the increasing demand for replacement of LED equipment in greenhouses in Europe, and under the stable price of lighting products, the market size is estimated to be US$1.79 billion, with an annual growth rate of 6.6%. The LED plant lighting market size is estimated to be US$1.79 billion in 2022, with an annual growth rate of 6.6%.

Looking to the future, in the context of food security and global climate change, smart agriculture is increasingly put on the agenda of governments. Coupled with the continued advancement of cannabis legalization, the LED plant lighting market demand will maintain a steady growth trend in the future. TrendForce estimates that the market size will reach US$2.89 billion in 2026, with a compound growth rate of 11.5% from 2021 to 2026.

Although the short-term and long-term demand sources for plant lighting are relatively clear, if industry chain companies want to achieve sustainable development in the field of plant lighting, the key factor is whether their plant lighting products can meet the needs of terminal planting and improve the input-output ratio of enterprises and end users. Especially after the high demand stage, more and more players are entering the field of plant lighting, and companies need high-quality products to win a place in the increasingly competitive plant lighting market.

Packaging companies continue to improve light efficiency, reliability, and cost-effectiveness to meet the needs of planting in various scenarios

Whether it is cannabis cultivation, plant factory or greenhouse cultivation, the core demand can be summarized as quickly harvesting high-quality crops at the lowest cost. Therefore, the core requirements of plant lighting products for downstream industry or end customers are usually inseparable from high light efficiency, high cost-effectiveness, and high reliability in order to maximize the input-output ratio.

Currently, in response to the application needs of downstream customers and terminals, LED packaging companies have launched a rich product portfolio and continue to improve product performance. Domestic and foreign LED packaging manufacturers such as Nationstar Optoelectronics, Ruifeng Optoelectronics, Tiandian Optoelectronics, Hongli Zhihui, Smed, Zhongshun Semiconductor, Lidelda, Jinko Electronics, Luminus, ams Osram, and Cree have launched a variety of series of products.

Size: Most manufacturers have launched 2835, 3030, and 3535 size products, focusing on high reliability, high cost performance, and high light efficiency. Some manufacturers have also launched larger-sized 5630 and 5050 products to improve light efficiency and heat dissipation capabilities.

In addition, for different application needs, manufacturers use packaging brackets and substrates of different materials, including PCT materials with high temperature resistance, high reflectivity and low moisture absorption, EMC materials with high air tightness, high temperature aging resistance, high UV attenuation resistance, and ceramic substrates with good thermal conductivity and corrosion resistance, to cope with the complex environment of plant cultivation.

In addition to providing products of different sizes and using different material brackets, Smede, a subsidiary of Hongli Zhihui, also adopts a special coating process to ensure product reliability, which further improves the anti-sulfurization performance.

Spectrum: Since different plants have different needs for light at different growth stages, the LED plant lighting products launched by manufacturers not only cover the 400~700nm range of photosynthetically active radiation, but also extend to the ultraviolet and infrared bands, covering the full spectrum.

Among them, Ruifeng Optoelectronics has launched a series of PC color conversion products with rich light colors, including green (Green), mint green (Mint), lime (Lime), amber yellow (Amber), and red (Red). The overall plant lighting product light color covers the 400~760nm band.

Cree’s J series 2835 color LED products also cover 14 light colors, including PC Mint, Photo Red, Far Red, PC Purple, etc.

Luminus has a very comprehensive LED product line, covering multiple packaging platforms of mid-power series, high-power 3535 SMD series, and COB series; plant lighting products cover the full spectrum from 280nm (UVB/UVC) to far-red light (730nm).

However, it is worth noting that the application combination solutions promoted by enterprises are basically concentrated on high-power white light + red light. TrendForce Research shows that this is because the red light + white light solution is currently used in more and more greenhouse applications, so manufacturers are constantly launching new products to meet demand.

Photosynthetic photon energy efficiency (PPE): Lighting manufacturer Zhongke Sanan said that the technology of plant lighting lamps is mainly reflected in the improvement of light efficiency. The photosynthetic photon energy efficiency (PPE) of the whole lamp applied in vertical farms has increased from 2.4 μmol/J in 2021 to the current 2.7 μmol/J, and is expected to rise to 3 μmol/J by the end of this year.

As terminal application scenarios continue to increase the performance requirements of lamps, packaging companies have also launched high-light-efficiency products to support plant lamps to achieve higher performance levels. Usually, the PPE value of plant lighting lamp beads is concentrated in the range of 1~4 μmol/J. For a long time, packaging manufacturers have been constantly trying to break through this limit, especially in the popular white light and red light products on the market.

ams Osram's high-power LED product series OSLON® Square, its Hyper Red lamp beads have a PPE of 4.16μmol/J and a photoelectric conversion efficiency (WPE) of up to 76% at 700mA current.

Cree's new plant lighting product Photophyll Select increases the PPE of broad-spectrum lamps to 3.25 μmol/J, a 6% increase compared to the previous solution, and the lumens and luminous efficiency (LPW) of the lamps increase by 17%.

Domestic manufacturers are also actively catching up. Among them, Ruifeng Optoelectronics, Hongli Zhihui, and Lideda have all increased the PPE of red light products to more than 4 μmol/J under the condition of 700mA current; and increased the PPE of white light products to more than 3 μmol/J under the condition of 60 or 65mA current.

Power supply and terminal companies are showing their talents to promote the development of plant lighting business

While packaging companies continue to enrich plant lighting product series and improve product performance, driving power supply and terminal lighting product companies, as important components of the plant lighting industry, are also continuing to make efforts in the research and development, production capacity construction, application and promotion of plant lighting products.

Drive power supply: In the first half of the year, Mosuo Power has mass-produced an 800W power supply series for plant lighting applications in terms of isolation drive technology, using digital driver ICs with high efficiency, high reliability, and high heat resistance; in terms of non-isolation drive technology, it has mass-produced a 400W power supply series, which adopts a patented design and has the technical characteristics of high efficiency and no afterglow.

Inventron announced in June that it would raise 1 billion in additional funds to acquire Osram's digital system division and build an LED intelligent control drive power supply production project. Among them, the power supply production and construction project produces driving power products suitable for various scenarios and power levels such as plant lighting and smart lighting.

Songsheng Technology reached a strategic cooperation with the Institute of Urban Agriculture of the Chinese Academy of Agricultural Sciences in May to jointly promote the application of LED drive power supplies and related technologies in the future agricultural field through in-depth industry-university-research cooperation.

Plant lighting fixtures: Fluence reached cooperation with multiple companies in the first half of the year. In March, Fluence reached a cooperation with Hydrofarm, an agricultural equipment manufacturing and distributor, to distribute its plant lighting products in the United States. In July, Fluence reached a cooperation with BioLumic, a plant growth technology company, to use ultraviolet light to improve plant yield and quality. In August, Fluence cooperated with Israeli lighting supplier REMY to develop the Israeli medical cannabis cultivation market.

Acuity Brands, a major American lighting company, announced in July that it would enter the plant lighting market and launch Verjure?, a professional-grade horticultural LED lighting product line, which is specially designed for growing vegetables, flowers and other plants. It features high light efficiency, high reliability, and simple appearance.

Summary

Although the current market demand is not as strong as the same period in the past year or two, industry chain companies have not lost confidence in the plant lighting market. They are still optimistic about the future development of the industry, and are looking for ways to develop future plant lighting through different methods. For example, packaging companies continue to enrich product portfolios and continuously improve product performance to win sales with product quality. Drive power supply and terminal lighting companies are accelerating industrial layout through multiple channels such as product research and development, production capacity construction, application and promotion.

It can be seen that the temporary slowdown in market demand has given the plant lighting industry an opportunity to develop in a more mature direction. Enterprises in the industry chain will conduct more in-depth discussions and research on product optimization and effective implementation during the market cooling period, in order to be fully prepared before the arrival of greater demand and promote plant lighting products to play a more important role in future agricultural planting and breeding fields. (Text: LEDinside Irving)

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