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2026 Lighting Industry: Rising Costs Under Pressure Trigger a Wave of Price Increases as Overseas Expansion Enters a Phase of Structural Upgrading

Release time:

2026-03-13

Since 2026, China’s lighting industry has been facing a dual challenge from rising costs and shifting market dynamics. With core raw material prices—such as copper and chips—remaining at high levels, coupled with adjustments to the supply chain, the entire industry has seen a wave of intensive price adjustments. At the same time, overseas markets are showing a diverging trend: emerging markets are experiencing rapid growth, while compliance requirements in Europe and North America are becoming increasingly stringent. Chinese lighting companies are shifting from cutthroat competition driven by low prices to value‑based competition, seeking breakthroughs amid mounting cost pressures and expanding export opportunities.

Cost pressures continue to mount, sparking a wave of price hikes across the entire lighting industry chain. According to incomplete industry data, as of mid-March 2026, the number of lighting and related companies that have issued price increase notices since the beginning of the year has exceeded 50, spanning every stage of the value chain—from upstream chips and midstream power packaging to downstream finished lighting products. Price increases generally range from 5% to 15%, with some niche product categories seeing hikes exceeding 40%. Moreover, several companies have already initiated a second round of price adjustments, with most of these policies set to take effect officially on April 1. The primary driver behind this round of price hikes is the sustained high level of raw material prices: at the start of 2026, copper prices surged to 101,600 yuan per ton, representing a year-on-year increase of 35.08%. Given that copper accounts for a significant share of lighting product costs, every 10% rise in copper prices translates into a 3%–5% increase in finished product costs—far exceeding companies’ ability to absorb such increases internally. At the same time, the explosive growth of the AI industry has led to a shift in wafer production capacity toward high‑end computing chips, resulting in “capacity‑shift–induced shortages” for lighting‑specific chips and driver ICs. Driver IC prices have risen by 5%–10% since the Spring Festival, further intensifying cost pressures on manufacturers. In addition, the ongoing upward trend in the prices of raw materials such as silver and plastic pellets has only compounded the cost challenges faced by lighting companies. Most firms report that even after implementing multiple measures to mitigate cost fluctuations, they still struggle to offset the impact of rising upstream raw material prices—and price increases have become an inevitable choice to ensure product quality and supply chain stability.

Looking at corporate pricing adjustments, leading companies are taking the lead in raising prices, while price increases vary significantly across different subcategories. Upstream chip and power supply firms have been the first to act: on March 1, Songsheng Co., Ltd. announced that, effective March 16, it would increase the prices of its entire line of LED power products by 5%–15%; Huapu Yongming, for its part, explicitly stated that, starting April 1, it would implement a uniform price hike of 5%–10% across its entire product portfolio to address the operational pressures stemming from rising raw material costs. Among downstream finished lighting manufacturers, top players such as Signify, Bull, Hongyan, and Guipai have all followed suit. Signify has been particularly active, issuing multiple price adjustment notices in quick succession, covering a wide range of product categories including indoor and outdoor professional luminaires, traditional lighting, and OEM products, with price increases ranging from 3% to 50%. Bull has adjusted prices for its lighting products, while Hongyan has implemented phased price adjustments across lighting products, smart panels, switches, and sockets, with maximum increases reaching 43%. Zhouming Technology is focusing on outdoor lighting products, with price hikes ranging from 5% to 15% effective April 1, covering popular categories such as landscape illumination and road lighting. Notably, this round of price increases follows a clear pattern—upstream suppliers pass along cost increases, midstream manufacturers follow suit, and downstream retailers ultimately implement the adjustments. High‑end packaging products like RGB LED beads have seen price increases of 8%–15% due to surging demand from applications such as smart cockpits, whereas conventional packaging products have experienced relatively moderate price hikes, ranging from 3% to 6%.

Rising costs are triggering a ripple effect in the market, accelerating the divergence of industry dynamics. In the short term, China’s lighting market is showing a pattern of “strong seasonal inventory buildup followed by a potential decline in the second quarter.” Enterprises in source production bases such as Guzhen in Zhongshan are rolling out strategies like liquidating existing stock and locking in low prices to entice distributors to stock up in advance, thereby boosting short‑term order growth. However, industry insiders predict that as price‑increase policies are fully implemented, end‑user demand may be curbed, and second‑quarter orders are likely to see a downturn. From the perspective of market players, small and medium-sized lighting companies are under significant pressure: lacking economies of scale and the ability to pass on cost increases, they are squeezed from both sides by rising raw material prices and price adjustments made by leading firms, further narrowing their operating space. Some enterprises are facing the dual challenges of capacity contraction and order losses. In contrast, mid‑to‑high‑end lighting companies—especially those focusing on smart lighting, health lighting, and low‑carbon lighting—are less affected by price hikes. Relying on product added value and brand strengths, they can still maintain stable market demand and profit margins, and industry concentration is expected to rise further. On the terminal market front, demand for low‑price residential lighting may decline, while mid‑to‑high‑end lighting needs in sectors such as commercial complexes, cultural and tourism projects, and smart city development—supported by the “Two New” policies—remain robust, serving as a key pillar for industry growth.

The overseas market is showing a diverging trend, with compliance and value enhancement emerging as core competitive strengths. Data released by the General Administration of Customs on March 10 show that from January to February 2026, China’s cumulative exports of lamps, lighting fixtures, and their components reached RMB 45.79 billion, representing a year-on-year increase of 14.3%. This marked a complete reversal of the downward trend that had seen two-digit year‑on‑year declines for six consecutive months in the second half of 2025, delivering a strong start to the year. From an export perspective, the market structure has undergone a significant reshaping: ASEAN has surged to become China’s largest export market for lamps, accounting for 25%–28% of total exports, with export growth to ASEAN exceeding 30%. Meanwhile, exports to Africa and the Middle East have grown by more than 45% and 20%–22%, respectively, as the benefits of the RCEP and Belt and Road Initiative continue to be realized. In contrast, the U.S. market has seen its export share shrink to 13%–15% due to tariff barriers and supply chain spillovers; however, the robust growth of emerging markets has effectively offset the risks associated with a decline in any single market.

Meanwhile, the compliance thresholds in the EU market continue to rise, posing a significant challenge for Chinese lighting companies seeking to expand overseas. As of 2026, the EU is steadily enforcing the Eco‑Design Directive (ErP) and the Energy Labelling Regulation, which maintain the A–G rating system for energy efficiency labels. Products are now required to be registered in the official EPREL database, with key information such as the unique registration number and annual power consumption clearly indicated. Moreover, the testing standards for metrics like flicker, color rendering, and standby power consumption have been tightened. In addition, the EU’s Carbon Border Adjustment Mechanism (CBAM), commonly known as “carbon tariffs,” was officially implemented on January 1, 2026. Although lighting fixtures themselves are not yet directly included in the scope, core structural materials such as steel and aluminum have already been factored into the carbon footprint calculations—and by 2028, the scope will be further expanded to cover more lighting-related product categories. This will indirectly increase export costs for businesses and heighten the risk of order shifts. Against this backdrop, Chinese lighting companies are shifting their overseas expansion strategy from traditional OEM manufacturing toward brand building and solution-oriented approaches. High‑value-added products such as smart lighting, photovoltaic‑powered storage lighting, and custom‑colored decorative lights have become the mainstays of exports. From January to February, exports of festive and decorative lighting surged by 25%–30% year‑on‑year, driving an 8%–12% year‑on‑year increase in the industry’s average export unit price. Companies that possess EU ErP and CE compliance certifications and boast strong R&D and design capabilities are seeing their pricing power and market share steadily grow.

Industry experts say that in 2026, the lighting industry will face both cost pressures and overseas expansion opportunities. While price hikes are a passive response by companies to mounting cost pressures, they also represent a proactive choice for the industry to break free from low‑price, cutthroat competition and move toward value‑based competition. Looking ahead, as raw material prices stabilize, the pace of price increases may slow down; however, the trend of high costs is unlikely to change in the short term. On the overseas market front, the growth potential of emerging markets will coexist with compliance challenges in Europe and North America for the long term. Chinese lighting companies must focus on technological innovation, optimize supply chain management, and enhance product added value and compliance capabilities if they hope to seize the initiative during industry reshuffling and achieve high‑quality development.

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