Market Trends of North America Agricultural Films Industry
Declining Arable Land Drives Agricultural Film Adoption for Enhanced Productivity
The decline in arable land across North America, driven by population growth, urbanization, industrialization, soil degradation, and climate change, has increased the demand for agricultural films. The conversion of farmland into urban and industrial areas, combined with reduced productivity of existing agricultural land, has limited the availability of land for farming. According to World Bank data, Canada's arable land decreased from 38.5 million hectares in 2021 to 38.1 million hectares in 2022. Agricultural films have become essential components in modern farming practices across North America to maximize productivity from the diminishing agricultural land.
The growing population in North America is increasing the need for enhanced agricultural productivity, supporting market growth. Immigration trends also contribute to this demographic expansion. In 2023, the United States had 47.8 million immigrants, an increase from 46.2 million in 2022, according to the U.S. Census Bureau. Immigrants constituted 14.3% of the total U.S. population of 335 million in 2023. This population growth has increased food demand, creating opportunities for agricultural films to enhance productivity. The need to improve agricultural output to meet the food requirements of an expanding population, combined with diminishing farmland availability, drives the commercialization of agricultural films.
Furthermore, agricultural films are gaining prominence in water-scarce regions of North America, including Texas, Oklahoma, and Kansas. These films help conserve water by reducing evaporation and improving water distribution to plants, which enhances agricultural productivity. The combination of decreasing arable land and a growing population, both domestic and immigrant, has heightened concerns about agricultural productivity. These factors are driving the increased adoption of agricultural films in the region.
Canada Dominates the Agricultural Film Market
Canada's agricultural film market is growing due to the increased adoption of advanced farming techniques, particularly greenhouses, which help overcome unfavorable climatic conditions. According to the Government of Canada, greenhouse vegetable exports increased by 19% from 2022, reaching USD 1.7 billion in 2023. These exports represented 48% of all fresh produce exports from Canada in 2023, with greenhouse cucumbers comprising 38% of the total export value, followed by tomatoes at 32% and peppers at 30%. The country's growing population and increased vegetable consumption have expanded greenhouse operations and vegetable cultivation areas, driving the demand for agricultural films. Statistics Canada reported that greenhouse fruit and vegetable sales increased by 9% from 2022, reaching USD 2.5 billion in 2023. This growth in greenhouse produce demand has directly contributed to expanding greenhouse facilities, increasing the demand for agricultural films in Canada.
Along with this, greenhouses provide controlled environmental conditions that protect crops from adverse weather and extend growing seasons. Agricultural films create barriers from external elements and trap heat to maintain optimal temperatures, driving market growth in Canada. The increasing investments in greenhouse farming further support this growth. For instance, in 2022, Equilibrium Capital raised more than USD 1 billion for its second North American greenhouse food-focused fund.
Additionally, the increasing health consciousness among consumers and their preference for chemical-free produce is driving the expansion of greenhouse farming, which requires agricultural films. The growth in greenhouse production facilities across Canada, coupled with increased investments in the greenhouse market, is fueling the demand for agricultural films in the country.
