A large collaboration is announced in the horticultural industry. The Chinese Huafa Group is making its way into horticulture. Not only are they planning to build 500 hectares of greenhouses in China within the coming years, but they are also active in the lighting industry now. They acquired 25% of MegaPhoton inc. active in the manufacturing and sales of assimilation lighting systems for greenhouses.
Robert-Jan de Goeij
"This is great news for our company as we have ambitious growth plans with a strong focus on innovations. The market for HPS has not developed for many years. We are going to change that and we want to play a leading role in it”, says Robert-Jan de Goeij, CEO with MegaPhoton. “Bringing to the market our High Light Output light fixture with Internal Reflector is just the first step.”
To realise this ambitious growth the Huafa Group, based in Zhuhai, is an interesting - and major - player. The company has an annual sales revenue of over US $ 7.3 billion.
Coming from a background in regional real estate, they’ve evolved throughout the years into a nationally known enterprise with four listed companies focusing on urban city operations, real estate development, financial industry and business investment. Now they are expanding into horticulture.
The Chinese horticultural industry is growing rapidly in China, thanks to the strong economic development and the support of both local governments as well as State-Owned Enterprises (SOEs). “It is estimated that in a time-span of 10 to 20 years, the low-tech plastic film greenhouses will be replaced by the modern Venlo greenhouses”, they explain – and with an acreage of 37 million square meters in total, there’s serious support needed.
“In 2019 there were over 6 million square meters (600 ha) of Venlo greenhouses under construction and the target for the coming 5 years is around 70 million square meters (7,000 ha) of Venlo greenhouses.”
Developing in this high speed, China is facing challenges in for example the effective management of high tech greenhouses, the evolution of the current inefficient wholesale market, the shift to a matured approach, the combination and integration of investors, vendors, greenhouse management and sales teams in an effective way.
Search for synergy
The Huafa Group and MegaPhoton search for synergy to help answer these questions. The Huafa Group is set out to construct 5 million square meters of Venlo greenhouses (500 ha) in 5 years' time, starting with the first project of 200,000 square meters (20 ha) in Zhuhai.
“Zhuhai is the largest city in the China Greater Bay Area, and is going to be the base for providing fresh and healthy vegetables for surrounding cities like Hong Kong, Macao, Guangzhou, Shenzhen”, they explain. “The population of this area reaches 110 million people, with a high concentration of wealth.” With the project, they’re also ensuring the stabilization of the economic growth of Zhuhai and boosting the city’s social and economic developments.
Their partnership with Megaphoton comes naturally. “As MegaPhoton has been servicing the greenhouse market for almost 20 years, it has extensive knowledge within the horticultural sector. With the acquiring part of the Megaphoton company, we strive for strong synergies to reach our ambitious mid-term business goals in the field of greenhouse construction. MegaPhoton on the other hand benefits from the strong capital injections to finance its strong growth of the new ‘maximum light output fixture’ (with silver coated internal reflector), in all parts of the world.”