Agricultural equipment market Is Projected to Expand At A CAGR Of 6.6% Between 2023 And 2031. The global agricultural equipment market is a large and growing market that includes machinery, tools, and vehicles used in farming and agricultural activities. The market is highly competitive, with several large players dominating the industry. The agricultural equipment market is expected to grow at a steady CAGR of around 6.6% from 2024 to 2032. Factors driving this growth include increasing demand for food due to population growth, rising mechanization and automation in farming practices, and the adoption of precision farming techniques.
Growing population and increasing demand for food
The world's population is expected to reach 9.7 billion by 2050, which will increase the demand for food production. According to the Food and Agriculture Organization (FAO) of the United Nations, food production needs to increase by 70% by 2050 to meet the growing demand. This will drive the demand for agricultural equipment such as tractors, harvesters, and other machinery used for planting, irrigation, and harvesting crops. Additionally, as per a report by the United States Department of Agriculture (USDA), developing economies such as China, India, and Southeast Asia are expected to increase their demand for agricultural commodities due to rising population and income levels, further driving the demand for agricultural equipment.
Rising mechanization and automation in farming practices
Farms are becoming larger and more mechanized, which is driving the demand for more advanced and efficient agricultural equipment. According to a report by the International Finance Corporation (IFC), mechanization in agriculture can increase crop yields by up to 60% and reduce production costs by up to 50%. In addition, automation technologies such as precision farming and autonomous vehicles are becoming increasingly popular due to their ability to optimize crop production and reduce labor costs. As per a report by the Association for Advancing Automation (A3), sales of agricultural robots increased by 20% from 2017 to 2018, indicating a growing trend toward automation in agriculture.
Adoption of precision farming techniques
The adoption of precision farming techniques is a significant driver of growth for the agricultural equipment market. Precision farming techniques involve using advanced technologies such as sensors, GPS mapping, and data analytics to optimize crop production and minimize waste. By monitoring soil moisture and nutrient levels, farmers can optimize their use of water and fertilizers, resulting in cost savings and increased efficiency. Precision farming techniques also improve the accuracy of planting, harvesting, and other farming operations, leading to more consistent and efficient crop production. This has increased the demand for advanced agricultural equipment like precision irrigation systems, drones, and autonomous vehicles, which are expected to continue to grow as technology advances.
High Cost
The high cost of agricultural equipment is a major restraint for the agricultural equipment market. The development of new technologies and materials used in manufacturing agricultural equipment can lead to high costs, making it difficult for small and medium-sized farmers to invest in advanced equipment. The research and development process can be time-consuming and expensive, contributing to the high prices of end products. Furthermore, limited access to financing and credit for farmers in developing countries can also make it difficult for them to acquire the latest technologies and equipment. This ultimately hinders the adoption of precision farming techniques, which can improve efficiency and reduce costs over time. Despite the benefits of advanced equipment and precision farming techniques, the high cost of agricultural equipment remains a significant challenge for the industry.
Farm Tractors Dominated the Market by Product
The agricultural equipment market is segmented based on product type, which includes farm tractors, harvesting machinery, planting and fertilizing machinery, irrigation machinery, and others. Each product segment has unique characteristics, market trends, and growth drivers that affect its revenue and CAGR. Farm tractors have the highest revenue share while harvesting machinery is expected to grow at the highest CAGR during the forecast period. The adoption of precision farming techniques and the need for higher yields are key drivers of growth for the planting and fertilizing machinery segment. Meanwhile, the demand for water-efficient irrigation systems and sustainable farming practices is driving the growth of the irrigation machinery segment.
Land Development and Seed Bed Preparation Dominated the Market by Application
The agricultural equipment market is segmented based on application, which includes land development and seedbed preparation, sowing and planting, weed cultivation, plant protection, harvesting and threshing, and post-harvest and agro-processing. Land development and seedbed preparation have the highest revenue share while harvesting and threshing machinery is expected to grow at the highest CAGR during the forecast period. The adoption of precision farming techniques and the need for efficient planting operations are key drivers of growth for the sowing and planting machinery segment. Meanwhile, the demand for weed control in farming and sustainable agriculture practices is driving the growth of the weed cultivation machinery segment.
Asia Pacific Remains the Global Leader and Growth Leader
Asia Pacific held the largest share in 2023, followed by North America and Europe. The Asia Pacific region is expected to witness the highest CAGR compared to other regions due to its large population, increasing urbanization, and growing demand for food in the region during the forecast period of 2024 to 2032. Asia Pacific held a revenue share of around 40% in the agricultural equipment market in 2023. North America is the largest regional market for agricultural equipment due to the high adoption of precision agriculture techniques, such as GPS guidance systems and drones, which is a major factor driving the market's growth in this region. North America held a revenue share of around 30% in the agricultural equipment market in 2023.
Competitive Analysis
Global players such as John Deere, CNH Industrial, AGCO Corporation, Mahindra & Mahindra Ltd., and Kubota Corporation dominate the market, accounting for a significant share of the revenue. These companies have a strong global presence and offer a wide range of products, including tractors, harvesters, and other farm machinery. Regional players also play a significant role in the agricultural equipment market, especially in developing regions such as Asia Pacific and Latin America. These companies cater to the local demand and offer cost-effective solutions to farmers. Product innovation is a key strategy adopted by companies to stay competitive in the market. For example, John Deere has been focusing on precision agriculture and developing autonomous farming equipment to improve productivity and efficiency. CNH Industrial has been focusing on developing sustainable and eco-friendly equipment, such as electric tractors and autonomous sprayers. Pricing is another factor that companies focus on to stay competitive in the market. Companies often offer discounts and promotional offers to attract customers and increase their market share. After-sales services are crucial for customer retention and loyalty. Companies offer maintenance and repair services to customers to ensure that their equipment performs optimally. This also helps in building long-term relationships with customers. The agricultural equipment market is highly competitive, and companies need to continuously innovate and provide value to customers to stay ahead of the competition. With the increasing demand for advanced farming techniques and the need for sustainable agriculture, companies that can provide innovative and cost-effective solutions are expected to have a competitive edge in the market.
Historical & Forecast Period
This study report represents analysis of each segment from 2022 to 2032 considering 2023 as the base year. Compounded Annual Growth Rate (CAGR) for each of the respective segments estimated for the forecast period of 2024 to 2032.
The current report comprises of quantitative market estimations for each micro market for every geographical region and qualitative market analysis such as micro and macro environment analysis, market trends, competitive intelligence, segment analysis, porters five force model, top winning strategies, top investment markets, emerging trends and technological analysis, case studies, strategic conclusions and recommendations and other key market insights.
Research Methodology
The complete research study was conducted in three phases, namely: secondary research, primary research, and expert panel review. key data point that enables the estimation of Agricultural Equipment market are as follows:
Market forecast was performed through proprietary software that analyzes various qualitative and quantitative factors. Growth rate and CAGR were estimated through intensive secondary and primary research. Data triangulation across various data points provides accuracy across various analyzed market segments in the report. Application of both top down and bottom-up approach for validation of market estimation assures logical, methodical and mathematical consistency of the quantitative data.
| ATTRIBUTE | DETAILS |
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| Research Period | 2022-2032 |
| Base Year | 2023 |
| Forecast Period | 2024-2032 |
| Historical Year | 2022 |
| Unit | USD Million |
| Segmentation | |
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Application
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Region Segment (2022-2032; US$ Million)
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Key questions answered in this report
