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Agricultural Equipment Market

Agricultural Equipment Market By Product ( Tractors, Rotavators, Threshers & Dehuskers, Power Tillers, Power Weeder, Plough, Baler, Seed Drill ), Category (Tractor Pulled / Attachment, Self-Propelled ), Ownership (Individual and Rental) & Region – Forecast 2021 - 2031

Agricultural Equipment Market By Product ( Tractors, Rotavators, Threshers & Dehuskers, Power Tillers, Power Weeder, Plough, Baler, Seed Drill ), Category (Tractor Pulled / Attachment, Self-Propelled ), Ownership (Individual and Rental) & Region – Forecast 2021 - 2031

Agricultural Equipment Market - Analysis, Outlook, Growth, Trends, Forecasts

Agricultural Equipment Market Snapshot

[280 Pages Report] The agriculture equipment market will expand at a steady CAGR of 4.8% between 2021 and 2031. The market valuation is set to reach US$ 65 Bn by 2021 end.

Owing to the increasing adoption of modern farm machinery, agriculture equipment sales are anticipated to reach around 6.7 Mn units by 2031.

The Agricultural Equipment Market witnessed a year-on-year (YOY) growth of 3.7% between 2020 and 2021, with top 5 market players collectively accounting for 44% market share in 2021.

Agricultural Equipment Market - Key Points

  • Agricultural Equipment Market estimates and forecast 2021-2031
  • Key drivers and restraints impacting market growth
  • Segment-wise, Country-wise, and Region-wise Analysis
  • Competition Mapping and Benchmarking
  • Brand share and Market Share Analysis
  • Key Product Innovations and Regulatory Climate
  • COVID-19 Impact on Agricultural Equipment Market and How to Navigate
  • Recommendation on Key Winning Strategies

Agricultural Equipment Market Historic Sales Compared to 2021- 2031 Forecast Outlook

With increasing demand for automated and advanced technologies in the agricultural sector, the agricultural equipment market is set to register a CAGR of 4.8% between 2021 and 2031, surpassing a valuation of around US$ 65 Bn by 2021 end.

Rapidly growing population, urbanization, favorable government initiatives and soaring demand for food across the world are the prime factors driving the agricultural equipment market.

Transition from traditional farming techniques to modern agricultural machinery has thrown new life into agricultural equipment market. Agricultural equipment prove highly effective in saving time as well as in increasing the crop production.

According to Department of Economic and Social Affairs (United Nation), world population is expected to reach 9.7 billion in 2050. This in turn is expected to increase food demand by 70% through 2050. In order to sustain such enormous population, farmers are increasingly utilizing modern agricultural equipment.

Governments across the globe are encouraging farmers to adopt modern agricultural equipment by introducing low interest loan schemes and subsidies. As a result, the sales of agricultural equipment are soaring. Similarly, emergence of contract farming also impacts the demand for agricultural equipment.

New advancements in technologies ranging from robotics and drones to computer vision software have completely transformed modern agriculture. Introduction of electrical equipment along with integration of artificial intelligence (AI), global positioning systems (GPS) and internet of things (IoT) technology in farm equipment is likely to push the market growth further.

Advanced farming machinery such as spraying equipment, harvesters and crop processing equipment are being employed to enhance overall crop output and quality. With augmented reality (AR), farmers can visualize their entire farm in a single dashboard. It also enables new farmers to get familiar with agricultural equipment through immersive e-learning environments.

Adoption of driverless and electrified equipment's such as tractors is gaining traction. The shifting consumer preference towards higher yield and cost-effective solutions is propelling the growth of the market.

With modern agriculture becoming highly mechanized, the market is set to bloom during the forecast period.

Agricultural Equipment Market - Impact of Government Initiatives

Increasing focus of government authorities on developing farming sector is providing lucrative growth opportunities for agricultural equipment manufacturers. Various schemes and subsidies are being introduced to relieve farmers from economic burden and encourage farm mechanization. For instance, the U.S. Department of agriculture (USDA) offers various loans with favorable interest rates to help agricultural producers start or expand their farming operation, purchase equipment and storage structures.

Similarly various schemes implemented by governments and other private organizations across the world are positively impacting the demand for agricultural equipment.

How is Digital Leasing Affecting Sales of Agricultural Equipment?

With the advancement in agricultural technology, the cost of new equipment is skyrocketing. Small farmers cannot afford to purchase these high-cost machineries, although utilizing them has become need of the hour. As a result, farmers turn to leasing to keep up with technology.

Leasing is growing in popularity on account of the payment flexibility and technological adaptability. It is a hedge against inflation.

Companies are collaborating with application companies to market leasing business and encourage farmers to use farm equipment at affordable prices.

Digital leasing is attracting large number of farmers. Various mobile applications are being launched by government authorities to help farmers in choosing the best farm equipment rentals at low costs. For instance, in 2019 Union Minister for Agriculture and Farmers Welfare (INDIA) launched CHC Farm Machinery app for farmers to have easy access to high value and technical agricultural equipment at their doorstep.

Similarly, EM3 AgriServices, an agriculture Services Company launched a mobile app for farmers in the state of Madhya Pradesh. By using this app farmers can place orders for renting farm equipment and services through both online and offline payment methods.

The introduction of these digital mobile apps is bolstering the sales of agricultural equipment as more people are inclined to lease the advanced agricultural equipment for their farms.

Agricultural Equipment Market - Country-wise Insights

How will the U.S Retain Dominance in Agricultural Equipment Market?

Agriculture is one of the leading industries in the U.S. As per United States Department of Agriculture (USDA), agriculture, food and related industries contributed around US$ 1.109 trillion to the gross domestic product (GDP) in 2019.

Increasing focus on mechanization in agriculture, labor scarcity, rising farm labor charges and favorable governmental policies are some of the factors driving the growth of agricultural equipment market in the country.

According to United States Department of Agriculture (USDA), average farm wages in the U.S. reached to US$ 16.21 per hour during the January 2021, reference week, up 6 percent from January 2020. This increase in farm labor has profound impact on agriculture equipment market.

Farming in the U.S. has been revolutionized by the technological advancements in farm equipment. Introduction of precision farming systems and AI with GPS technology in agricultural equipment is transforming the agriculture sector. For instance, in 2019 John Deere Developed AI-powered 8Rx tractor. The 8RX integrates artificial intelligence, the internet of things and advanced automation to help farmers work more efficiently.

Similarly, government is playing a vital role in promoting the adoption of advanced equipment for increasing crop production. For instance, in 2020 USDA launched a new platform called “Agriculture Innovation Agenda” (AIA) in order to provide farmers with the tools they need and to position American agriculture as leader in the effort to meet the food, fiber, fuel, feed and climate demands of the future.

With rapid technological advancement and availability of leasing option, agricultural equipment market in the U.S. is expected to register a strong CAGR during the forecast period.

How will China Emerge as the Leading Market for Agricultural Equipment?

China is one of the largest manufacturers of agricultural equipment in the world. The growing demand for digital agriculture is driving the agricultural equipment market in the country.

According to Huang Jikun, a member of the Ministry of Agriculture and Rural Affairs ‘digital technology is bound to play a bigger role in the country’s step towards vitalization and agricultural modernization’.

Food security in China has become challenging with tremendously growing population. In order to address this issue farmers are increasingly adopting advanced machinery into farming.

The Chinese government is highly committed to develop agricultural sector in the country. Various initiatives and policies have been taken by Chinese government to digitalize and promote the adoption of agricultural equipment. For Instance, in May 2021, a tripartite agreement was signed between the Ministry of Agriculture and Rural affairs (MARA) China, the National Administration for Rural Revitalization (NARR) and the Agricultural Bank of China (ABC) to boost Financial Service in Agriculture.

Similarly, the introduction of schemes like Made in China 2025 (MIC) is expected to offer lucrative growth opportunities to some of the country's leading equipment manufacturers during the forecast period.

Why is Demand for Agricultural Equipment High in India?

India is emerging as one of the most lucrative market for agricultural equipment. The country witnessed increase in farm mechanization trends in recent years.

Increasing population, government initiatives and growing demand for food are some of the factors driving the demand for agricultural equipment.

Agriculture is the primary source of livelihood for about 58% of India’s population. In order to address the rising food demand and promote use of advanced farm machinery, government of India has introduced various schemes. For instance, Rastriya Krishi Vikas Yojana (RKVY) was introduced to provide 100% subsidy. The scheme was aimed to assist the advancement of the farming sector.

Similarly, in order to boost the farm mechanization in the country, a special scheme ‘Sub Mission on Agricultural Mechanization (SMAM) was introduced by Government of India in 2014-2015. The scheme aimed at ‘reaching the unreached’ by making farm machines accessible and affordable for the small and marginal farmers.

India is the world's largest tractor manufacturer. Various leading manufacturers are investing huge amounts to establish their presence in India. For instance, in March 2020 Kubota Corporation announced that it will invest in an Indian leading tractor manufacturer, Escorts Limited (EL). Through this investment, Kubota intends to increase its presence in India.

Furthermore, the presence of leading agricultural equipment players such as Mahindra and Mahindra is driving the market in the country.

Agricultural Equipment Market- Category-wise Insights

Which Product Type will Dominate the Agricultural Equipment Market?

Tractors have emerged as the leading product category in agricultural equipment market.They can be used for several activities, both as a standalone equipment and in tandem with other equipment.

With growing demand for food products and increasing rate of mechanization in farm practices, large number of tractors are being employed. Developing countries like India and China are witnessing huge surge in the sales of tractors.

Adoption of self-driving tractors are gaining traction. Manufacturers are continuously focusing on integrating advanced technologies in tractors. For instance, in February 2021, Yanmar Agribusiness Co. Ltd., upgraded its autonomous tractor with multi-frequency antenna to improve its performance capabilities.

FMI forecasts that continuous improvement in tractor technology will accelerate the demand further during the forecast period.

Why are Self-propelled Equipment Preferred over Tractor Pulled Ones?

Farmers are more interested in employing self-propelled machines as compared to tractor pulled ones. Self-propelled equipment are faster and safer than their counterpart.

Using tractor pulled equipment increases the risk of accidents. As a result, high preference is being given to self-propelled ones.

Why Farmers opt for Rental Equipment over Individual ones?

Machinery and production equipment represent major costs that have been on the rise in recent years. Small scale farmers with their low budget cannot afford to purchase high-cost equipment. As a result, there has been rise in the rental segment.

Availability of rental agricultural equipment allow farmers to use latest technology for farming. Agricultural equipment suppliers are pairing with financial institutions to provide “rent to buy” option.

Agricultural Equipment Market- Competitive Landscape

As per FMI’s analysis, top 5 players in the market which include

  • Deere & Company
  • AGCO Corp
  • CNH Industrial N.V.
  • Kubota Corporation
  • CLAAS KGaA GmbH

account for 44% of the total market share.

Leading manufacturers are emphasizing on developing and launching advanced quality products. They are adopting various organic and inorganic growth strategies such as partnerships, mergers and acquisitions, advanced product development and collaborations to gain a competitive edge in the market. For instance

  • In August 2021, Deere and Company acquired Bear Flag Robotics, an agriculture technology startup based in Silicon Valley, for US$ 250 million. The deal accelerates the development and delivery of automation and autonomy on the farm and supports John Deer’s long-term strategy to create smarter machines with advanced technology.
  • In 2020, Kubota Corporation unveiled a “Dream Tractor” at a new product exhibition held in Kyoto City. Equipped with artificial intelligence (AI) and electrification technology, the “dream Tractor” is a completely autonomous tractor that represents the future of farming.
  • Similarly in December 2020, Raven Industries announced the launch of its first commercially-available Driverless Ag Technology: AutoCart.

Scope of the Report

Attribute

Details

Forecast Period

2021-2031

Historical Data Available for

2016-2020

Market Analysis

USD Million for Value and ‘000 Units for Volume

Key Regions Covered

North America, Latin America, Europe, East Asia, South Asia & Pacific, Middle east & Africa

Key Countries Covered

US, Canada, Germany, U.K., France, Italy, Spain, Russia, China, Japan, South Korea, India, Thailand, Malaysia, Indonesia, Australia, New Zealand, GCC Countries, Turkey, Northern Africa, and South Africa

Key Segments Covered

Product Type, Category, Ownership and Region

Key Companies Profiled

 

Bucher Industries AG, AGCO Corp, Deere & Company, EXEL Industries, CLAAS KGaA mbH, ISEKI & CO. LTD., CNH Industrial N.V., Krone UK Group, Kubota Corporation, LEMKEN GmbH & Co. KG, Mahindra & Mahindra Ltd., Mitsubishi Mahindra Agricultural Machinery Co. Ltd, SDF S.p.A., Tractor and Farm Equipment Limited (TAFE)

Report Coverage

Market Forecast, Company Share Analysis, Competition Intelligence, DROT Analysis, Market Dynamics and Challenges, and Strategic Growth Initiatives

Customization & Pricing

Available upon Request

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Agricultural Equipment Market by Category

By Product type:

  • Tractors
  • Rotavators
    • Wheel Type
    • Crawler Type
  • Threshers & Dehuskers
    • Wheel Type
    • Crawler Type
  • Power Tillers
    • Wheel Type
    • Crawler Type
  • Power Weeder
    • Wheel Type
    • Crawler Type
  • Plough
  • Baler
  • Seed Drill

By Category:

  • Tractor Pulled / Attachment
  • Self-Propelled

By Ownership:

  • Individual
  • Rental

By Regions:

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia & Pacific
  • Middle east & Africa

Key Questions Answered in the Report

What is the current agriculture equipment market value?

The agriculture equipment market surpassed a total valuation of US$ 65 Bn in 2021.
The agriculture equipment market grew at a slow CAGR of 2.8 % between 2016 and 2020.
Strengthening of value-added partnerships in sales, procurement and production by optimization of supply chain coupled with strategic collaborations are the key drivers fostering sales.
Top 5 prominent players of agriculture equipment market are Deere & Company, AGCO Corp, CNH Industrial N.V., Kubota Corporation and CLAAS KGaA GmbH.
North America’s agriculture equipment market demand is set to rise at 3.9% CAGR over the forecast period of 2021 and 2031.
Top 5 players operating in agriculture equipment collectively accounted for 44% of market share in 2021.
The sales for agriculture equipment are set to rise at an impressive CAGR of 4.4% CAGR across Europe between 2021 and 2031.
The U.S., Japan, India, Germany and China are the key producers of agriculture equipment.
The key exporters of agriculture equipment are China, Japan, India and the U.S.
Japan and South Korea, collectively account for 11% of global market share in 2021

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