Market Overview

Hydroponic Crop Farming in Australia Industry Market Research Report Now Available from IBISWorld

Share:

The Hydroponic Crop Farming industry in Australia has blossomed over the past five years despite an economic downturn and adverse weather conditions. Dry weather conditions hurt the productivity of soil-based farmers, which reduced competition in retail markets and enabled hydroponic crop farmers to widen their profit margins. For these reasons, industry research firm IBISWorld has added a report on the Hydroponic Crop Farming industry in Australia to its growing industry report collection.

Melbourne, Australia (PRWEB) October 25, 2012

The Hydroponic Crop Farming industry in Australia has blossomed over the past five years despite an economic downturn and adverse weather conditions. Industry revenue is estimated to grow at an annualised 2.9% over the five years through 2012-13 to reach $889.8 million. According to IBISWorld industry analyst Suzannah Rowley, “the strength of the industry has been due to efficient production methods that have much smaller water requirements”. The high quality of the industry's products also helped nurture demand for hydroponic crops. As such, industry revenue is expected to grow in 2012-13, unaffected by an expected decline in rainfall.

Profitability is expected to have increased over the past five years. Dry weather conditions hurt the productivity of soil-based farmers, which reduced competition in retail markets. The reduced competition enabled hydroponic crop farmers to widen their profit margins. Furthermore, industry operators invested in new equipment that increased productivity. “The reduced reliance on labour has also aided profitability increases”, Rowley adds. The industry is forecast to sprout faster growth over the next five years. Industry revenue is forecast to increase over the five years through 2017-18. The industry will continue to benefit from its ability to use water efficiently. Forecast dry weather conditions and environmental concerns will weigh in favour of the industry's water efficiency and closed systems.

Profitability in the Hydroponic Crop Farming industry in Australia is forecast to rise over the next five years. Profitability in the industry is tied to scale economies. Consequently, hydroponic crop farms are expected to consolidate to spread overhead and investment cost over more produce. This will be especially beneficial as the industry invests in machinery to automate farming processes further. Farmers that do not consolidate are expected to form cooperatives to benefit from scale economies in terms of marketing and bargaining power when dealing with supermarkets. There are no major players in the Hydroponic Crop Farming industry. Market share concentration is low because most hydroponic farm companies are small. They tend to specialise in certain crops and geographic locations and are able to use to smaller patches of land near capital cities. The use of this land gets operators closer to their markets and lowers transport costs.

For more information, visit IBISWorld's Hydroponic Crop Farming report in Australia industry page.

Follow IBISWorld on Twitter: http://twitter.com/#!/ibisworldau

IBISWorld industry Report Key Topics

Hydroponics is a method of growing plants using mineral nutrient solutions in water, without soil. Operators in the industry generally grow food crops under glass or protective cover.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
International Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Industry Globalisation
Major Companies
Operating Conditions
Capital Intensity
Technology & Systems
Revenue Volatility
Regulation & Policy
Industry Assistance
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognised as the nation's most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.

For the original version on PRWeb visit: http://www.prweb.com/releases/prweb2012/10/prweb10046081.htm

View Comments and Join the Discussion!