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Summary of our market study
Hydroponics is a growing system that enables plants, flowers, fruit and vegetables to be grown without soil. Hydroponics is particularly suited to urban agriculture, and offers advantages such as higher yields and reduced water use.
The global hydroponics market is valued at $13 billion and is expected to grow by over 13% a year.
The market is fragmented, with many start-ups entering the market.
The high cost of energy and technological investment makes the development of hydroponic businesses difficult and risky.
Demand for hydroponically-grown produce is growing due to its nutritional benefits.
The sector encompasses various technologies such as aeroponics and aquaponics, and offers potential for the cultivation of certain vegetables, fruits and herbs.
Major food and cosmetics companies are moving into this sector.
The French have always had a preference for fresh fruit and vegetables. Household consumption varies between 80 and 856 kilograms of fruit per year. Vegetable consumption varies between 80 and 89 kilograms per year.
90% of tomatoes are grown hydroponically in France
Pioneers in system solutions
- Signify Holdings (Netherlands)
- Argus Control Systems (Canada)
- Heliospectra AB (Sweden)
- LumiGroxw (United States)
- American Hydroponics (United States)
- Vitalink (United Kingdom)
- Hydroponic Systems International (Spain)
Growing champions
- Aerofarms (United States)
- Triton Foodworks (India)
- Green Sense Farms (United States)
Pioneers of urban agriculture
- AeroFarm American company
- InFarm German innovator
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Summary and extracts
1 Market overview
1.1 Definition and scope of study
Hydroponics refers to the activity of growing plants "above ground" on a base of "neutral" and "inert" substrate (clay balls, rockwool, etc.). Although in the strict sense of the term, hydroponics refers to a particular form of soilless cultivation, it is often assimilated with all soilless farming techniques. Variants of hydroponics, such as aeroponics, aquaponics and bioponics, have been developing in recent years. The main applications for hydroponics are horticulture and the cultivation of certain types of vegetables and fruit.
Hydroponics offers many advantages in that it provides solutions to the world's water shortages, as well as to the problems of pollution and land erosion. Since it does not require access to land, it also has interesting applications in urban agriculture, as underlined by the rise of vertical urban farms. What's more, hydroponic systems offer higher yields than traditional farming techniques, not least because the right nutrients are delivered directly to the plants' roots. Hydroponics generally does not require the use of artificial ripening agents and pesticides, which can help create nutritionally superior plant products.
Globally, the hydroponics market is fragmented, with many agritech start-ups entering the market, such as AeroFarm (USA) or InFarm (Germany). It is estimated to beworth $12.64 billion in 2023, and is expected to grow at a compound growth rate (CAGR) of 13.7% between 2023 and 2033, reaching a value of $45.66 billion in 2033 [Future Market Insights] . This growth is driven by the world's growing population, which is spearheading demand for agricultural and food products on the market.
In France, some fruit and vegetable growers see this as an opportunity: 90% of tomatoes are said to be produced hydroponically in France today[Franceinfo]. In fact, the trade balance for fruit and vegetables and also horticultural products has always been negative between 2016 and 2021, testifying to France's dependence on them. [France Agrimer]
As the capital cost of hydroponics is high, the crops produced are often sold at higher prices, and until now have tended to targetniche markets. Many hopes are pinned on hydroponics, and some even see it as a technique that could revolutionize tomorrow's agriculture. However, the high cost of hydroponics, particularly energy, is a real brake on the development of certain players. For example, over the past 2 years, many start-ups creating urban farms have gone into receivership, seeing their investors pull out.[Le Monde]
1.2 The global hydroponics market: current situation and main characteristics
Size of the global hydroponics market
The global hydroponics market is estimated to be worth $**.** billion in ****, and will grow at a compound growth rate (***) of **. *% between **** and ****, reaching a value of $**.** billion in ****. [***]
The hydroponics market is being driven by the world's growing population, which is spearheading demand for agricultural ...
1.3 Hydroponics, a possible response to a major global challenge: feeding a growing population while combating global warming
The world's population is set to reach ** billion by ****. Producing more food with limited resources, while trying to reduce greenhouse gas emissions, seems like a difficult equation to solve. Hydroponics may offer a solution to these problems, according to the FAO.
Hydroponics enables more intensive, "soil-less" production, as it takes up ...
1.4 The hydroponics market in France
The hydroponics market represents a sub-segment of the following markets: fruit & vegetables and horticulture. As we do not have the necessary data to estimate the hydroponics market, we briefly analyze the fruit and vegetable and horticulture markets below.
The fruit and vegetable market in France
Iterfel is an organization that brings ...
1.5 Foreign trade in horticultural products, fruit and vegetables
France dependent on fruit and vegetable imports....
The chart below highlights that France imports more fruit and vegetables than it exports, which could leave room for French hydroponic fruit and vegetable growers. Indeed, its trade balance remained negative from **** to ****, rising from -$*.** billion to -$*.** billion .
Trade balance for fruit ...
1.6 2022 : Agricool urban farm placed in receivership
Second blow for French Tech. After Sigfox, Agricool was placed in receivership on January ** by the Bobigny Commercial Court. In June ****, the Agricool urban farm will be sold for **,*** euros. [***]
The Bobigny Commercial Court has approved the takeover bid from Vif Systems. This Lyon-based company designs and installs farms, containers and ...
2 Demand analysis
2.1 Analysis of demand for fruit and vegetables in France
French demand in general
In theFMCG and self-service fresh produce market, the volume of household purchases for home consumption declined in **** (***), though remaining above their pre-**** level. [***]
The table below is taken from FranceAgriMer's report on household purchases of fresh fruit and vegetables:
Source: ****
After a year of record purchases for ...
2.2 Analysis of demand for horticultural products
Trend in French spending on horticultural products
In ****, **% of households purchased at least one outdoor plant (***), down on recent years due to a decline in average quantities purchased and average budget per purchasing household.
Average basket of outdoor plants in volume and value per purchasing household France, ****-****, in units, in ...
2.3 Hydroponics, a solution at the crossroads of several demand trends?
Determinants of demand for fresh fruit and vegetables
With hydroponics players often positioning themselves on fresh fruit and vegetables, the graph below highlights that two purchasing criteria prevail: seasonality (***).
Main criteria when buying fresh fruit and vegetables France, ****, in Source: ****
With regard to"seasonality", hydroponics doesn't normally depend on the seasons ...
2.4 Agricultural market trends in France
Changing profile of farmers
The profile of farmers has changed significantly over the past decade, with an aging population of farmers and a lack of generational renewal.
According to the French Ministry of Agriculture, ***,*** farms have disappeared in the last ten years, a drop of **%, even though the agricultural surface area ...
3 Market structure
3.1 Segmentation and dynamics of hydroponics players
Market segmentation and player typology
Three ways of segmenting the hydroponics market (***) are proposed below.
A first way is to distinguish between players who offer solutions for implementing hydroponic production systems, in which case their offer is aimed at producers such as urban farms. GHE is a good example, and also ...
3.2 The production process for hydroponics and its derivatives
General definition
Strictly speaking, hydroponics is the simplest soil-less cultivation technique, and one of the first to have been developed. In a broader sense, it encompasses various techniques (***).
The term " hydroponics" comes from the Greek "hydro" meaning water, and "ponos" meaning work. It is thus an "above-ground" form of agriculture that ...
3.3 The cost structure and the question of profitability
Main cost items
It all depends, of course, on the sophistication of the system installed, as the heterogeneous nature of hydroponic cultivation makes it difficult to carry out a pertinent analysis valid everywhere.
Installation (***).
The energy required to power LED and aeration systems. Here too, prices can vary widely depending on ...
3.4 Urban agriculture: a prime location for hydroponics?
One of the most popular applications for hydroponics is urban agriculture, particularly through the installation of vertical urban farms. Urban agriculture is a solution recommended by the FAO and the UN to meet food security needs. It also responds well to the challenges of urbanization, especially as it can have both ...
3.5 Out of town, hydroponics competes with traditional greenhouses for larger-scale productions
There are also hydroponic farms (***) in the countryside for products such as tomatoes and lettuces. This requires larger-scale production.
In France, for example, **% of tomatoes are grown above ground using hydroponic techniques [***].France produced around *** tonnes of tomatoes in ****, so *** tonnes of tomatoes would be produced hydroponically. France's biggest tomato producer ...
4 Offer analysis
4.1 Main products that can be grown hydroponically
Source: ****
Hydroponics is particularly well suited to growing certain vegetables (***), fruit and horticultural produce.
On the other hand, many products cannot be grown using this "soil-less" logic, as they require soil. This is the case for certain fruits such as apples and pears, as well as most cereals and potatoes. These ...
4.2 Getting started with hydroponics? Steps to follow
Steps to follow before starting hydroponics according to GHE (***)
General Hydroponics Europe offers a method for producing plants yourself using the hydroponics technique. The company also sells and installs customized hydroponic growing systems. It also offers a wide range of fertilizers, supplements and pH regulators for hydroponics. The company is a ...
4.3 Supply trends in urban vertical farms
Trends among urban farms
We can imagine a typology of three types of vertical urban farms, which respond to different trends in demand and operate thanks to different business models.
Low-tech, open-air urban farms, which don't necessarily focus solely on yield, because the problem with growing crops in the city is ...
5 Regulations
5.1 Regulatory framework
The traditional regulatory framework for fruit and vegetable trading activities
Decree **.**** of **/**/**** lays down health regulations for fruit and vegetables. They must be: of sound quality, clean, whole and have reached a sufficient degree of development and maturity; Decree n°**-**** of **/**/**** modified by decree n°**-*** of **/**/**** The treatment products ...
6 Positioning the players
6.1 Segmentation of hydroponics players
- General Hydroponics Europe
- Agricool
- FUL Ferme Urbaine Lyonnaise
- Agripolis
- Aeromate
- InFarm
- InVivo
- Les Sourciers
- Azuvia
- VIF Groupe
- GrowLed
- Culture Indoor
- Permaculture & Cie
List of charts presented in this market study
- Amounts invested in vertical farms by type of crop used
- Size of the global hydroponics market
- Size of the global vertical farm market
- Agriculture at the heart of global challenges linked to demographics and climate change
- Average basket of outdoor plants in volume and value per buyer household
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Latest news
InVivo, the cooperative turned giant - 04/07/2023
- InVivo is an agricultural cooperative giant with sales of 12 billion euros.
- InVivo reaches agreement to buy United Malt Group (UMG)
- The purchase of UMG is estimated at over 1 billion euros
- Following this transaction, InVivo will become the world's leading maltster.
- The global beer market, in which malt is a key ingredient, is experiencing dynamic growth.
- InVivo doubled in size following the merger with family giant Soufflet, reaching sales of over €10 billion.
- InVivo has over 13,000 employees and more than 90 industrial sites.
- It was formed from the union of 185 agricultural cooperatives.
- InVivo owns 76% of Teract, a distribution subsidiary.
- The initial merger that led to the creation of InVivo took place in 2001 between Sigma and Uncaa.
France's InVivo soon to be world malt leader - 31/03/2023
- Recent acquisition of La Malterie du Château by InVivo.
- Exclusive negotiations between Malteries Soufflet and United Malt Group (UMG) for a potential takeover.
- The deal could be finalized within three to six months.
- InVivo has sales of 12 billion euros.
- Malteries Soufflet would become the world's leading maltster, with annual production of 3.7 million tonnes and a 20% market share.
- UMG valued at 1 billion euros
- Expected beer market growth of between 2.5% and 5% over the next five years.
- According to IWSR, beer accounts for 75% of global alcohol volumes.
- Whisky market growth between 5% and 6% per year.
- Geographical complementarity between Malteries Soufflet (Europe, Latin America, Africa) and United Malt Group (Australia, Canada, New Zealand).
The InVivo group creates a wheat division called Episens - 06/02/2023
- More than 2400 employees
- 24 production sites
- Division sales €892 million in 2021-22
- With Episens, creation of the wheat division with the merger of Invivo's milling activities with Moulins Soufflet, and the ingredients activities of AIT ingrédients and Soufflet Biotechnologies
The InVivo cooperative tackles the relaunch of its wheat sector - 20/01/2023
- Episens, Invivo's wheat subsidiary, generates sales of €892 million, representing 8.5% of InVivo's total sales
- The baguette enters the Unesco World Heritage List
- Objective: double the subsidiary's sales by 2027
- Soufflet bakery-pastry subsidiary Neuhauser back on its feet
- InVivo also works on the 8 mills inherited from Soufflet to supply its plants
- Highly profitable milling ingredients division generates sales of €87 million
Bakery: how the InVivo group plans to expand. - 19/05/2022
- Neuhauser will benefit from a recovery plan to return to growth from 2023.
- The InVivo Group's plan is to relaunch production at the second Folschviller site in Moselle, which has been closed since 2019, by January 2023.
- International activity will continue to be supported by production capacity in France.
- Staff currently employed at one site will be redeployed, enabling both sites to return to full activity.
Agricool (fruit and vegetables) placed in receivership - 28/03/2022
- In 2020, Agricool had sales of €162,000 and losses of €7.72 million.
- Several buyers are interested in Agricool.
- Their aim is to produce healthy container strawberries grown without pesticides or chemical inputs in the heart of cities.
- 30 M€ raised in 2018 from a pool including Danone Manifesto Ventures and BPI France.
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the hydroponics market | France
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