CAGR: 5% Current Market Size: USD 156 BillionFastest Growing Region: APAC
Largest Market: North AmericaProjection Time: 2022-2029Base Year: 2021
The Global Agriculture Equipment market is expected to grow from USD 156 billion in 2021 to USD 230.48 billion by 2029, at a CAGR of 5% during the Projection period 2022-2029. The growth of this market is mainly driven owing to increasing development in end-user applications around the world.
A device, component of a device, or attachment to a device that is primarily intended to be used for agricultural purposes is referred to as agricultural equipment. Equipment related to raising animals or growing crops, as well as equipment used in horticulture or floriculture, is referred to as agricultural equipment. The mechanical tools and equipment used in farming and other forms of agriculture are referred to as agricultural equipment. Such equipment comes in a wide variety of farm implements that can pull or drive. Both organic and nonorganic farming employs a wide range of equipment. A vital component of how the world gets fed, especially since the introduction of industrial agriculture, is agricultural equipment. There are different kinds of agricultural machinery, including tractors, planters, sprayers, combines, and others. They serve a variety of functions; for example, tractors handle the bulk of the labor on contemporary farms. They are utilized to push and pull tools, such as tilling and seed-planting machines. By loosening the soil and eliminating weeds or competing plants, tillage implements prepare the soil for planting.
Sample Requirement: - Global Agriculture Equipment Market
Market Dynamics:
Drivers:
Implementing farm loan waiver programs incentivizes farmers to purchase agricultural machinery. Governments around the world introduced a number of programs to free farmers from debt and promote farm mechanization. The Organization for Economic Co-operation and Development (OECD) reported that from 2018 to 2020, farm policies in 53 countries—all OECD and EU member states as well as 12 important emerging economies—provided direct support to farmers worth an average of USD 728 billion annually. For instance, the Mahatma Phule Farm Loan Waiver Scheme was introduced by the Maharashtra (India) government in December 2019. A program called the Maharashtra Agro Business Network Project (Magnet) for small and marginal fruit and vegetable growers was also announced in March 2021.
Restraints:
The largest portion of the global rental industry is accounted by the purchase of farm equipment like tractors and harvesters, which is a significant investment in agricultural activities. The cost of the equipment made available to farmers reflects the significant investments required throughout the entire design, production, and distribution process. The low penetration of farm equipment in developing nations is due to small farmers' inability to invest a large sum. Farmers choose to rent farm equipment to speed up production and turnaround times, which boosts the effectiveness and profitability of the enterprise. Compared to financing the purchase of the equipment through a standard loan from a financial institution, renting farm equipment is more affordable. Farm equipment rental services have been driven by the worldwide shortage of farm labour and rising labour costs. In order to increase operational effectiveness and profitability, rental agriculture equipment is increasingly adopting cutting-edge technologies. It enables small-scale farmers to rent expensive farming equipment in order to grow a wider range of crops more quickly and more effectively.
Opportunities:
Farm mechanization and agricultural productivity are directly correlated, according to the Economic Survey, since farm mechanization increases crop output and farm income while saving time and labor, reducing drudgery, decreasing production costs over the long term, and reducing post-harvest losses. Farmers are forced to concentrate on efficiency and productivity in order to spur business growth since the agriculture industry is constantly under pressure to produce agricultural products to meet the needs of the expanding population. Farmers that aim to increase production while working with limited resources are increasingly using precision farming. The growing demand for food globally may be adequately addressed by this agricultural method. By increasing productivity and enhancing operational efficiency, farmers can reduce the discrepancy between supply and demand for agricultural products. The efficient use of agricultural technology enables farmers to quickly rotate crops on the same plot of land while also increasing productivity and output. Utilizing water, seeds, land, fertilizers, and agricultural machinery in an effective manner is made possible by precision farming technology, which enhances both the overall number and quality of crops.
Challenges
Concerns regarding emission laws have been voiced by CNH Industrial, John Deere, and AGCO in various parts of the world. The adoption of emission standards may restrict the sales of agricultural and construction equipment. Changes to emission rules necessitate considerable R&D expenditures. Each market has its own emission standards, which make it more difficult to design components, particularly engines. The BS Term IV rule was put into effect by the Indian government in March 2022. Tractors with a capacity of more than 50 HP are expected to be subject to the TREM IV emission norms. However, TREM IIIA rules would continue to regulate a significant chunk of the entire sector (50 HP), only having an impact on 10% of the volumes of the Indian tractor market as a whole. As a result, altering emission restrictions to satisfy governmental regulations may make it harder to sell tractors. Furthermore, it is anticipated that tougher emission standards for farm equipment that complies with Euro Stage IV may lead to a 1015% price increase for this equipment.
Segmentation Analysis:
The global agriculture equipment market has been segmented based on product, application, and region.
By Product
The product includes tractors, planting equipment, harvesters, and others. The tractors segment led the agriculture equipment market with a market share of around 27% in 2021. Tractors are now a necessity for boosting agricultural production, which is why the market is developing as a result of the labor crunch and rising population to fulfill the world's food needs. The rise has also been boosted by the promotion of farm mechanization and the expanding use of precision farming in regions like the Asia Pacific and Latin America. For market players, the advent of electric tractors is expected to represent a considerable growth opportunity. The growth is attributed to the electric tractors' cost-effectiveness as well as their great efficiency and environmental friendliness.
By Application
The application includes harvesting & threshing, land development & seed bed preparation, sowing & planting, plant protection, and others. The land development and seedbed preparation segment led the agriculture equipment market with a market share of around 23% in 2021. Tractors, levelers, and agricultural equipment are all included in the land development and seedbed preparation. Due to a number of causes, including the need for more food driving the need for mechanized farming, the availability of technologically improved tractors, and increased urbanization leading to a labor crisis compelling farmers to embrace technology, the demand for agricultural tractors is on the rise. It is Projectioned that this will help the market grow.
By Regional Analysis:
The regions analyzed for the agriculture equipment market include North America, Europe, South America, Asia Pacific, the Middle East, and Africa. The North America region dominated the agriculture equipment market and held a 38% share of the market revenue in 2021.
Global Agriculture Equipment Market- Country Analysis:
Germany's Agriculture Equipment market size was valued at USD 12.23 billion in 2021 and is expected to reach USD 15.49 billion by 2029, at a CAGR of 3% from 2022 to 2029. German engineering is the best in the world, and this contributes to the preference of German agricultural equipment. One of Europe's top locations for FDI in mining, construction, and agricultural machinery is Germany. These elements effectively fuel the nation's market. Germany has also developed a very talented and well-trained crew to operate its cutting-edge agricultural equipment, enabling the application of cutting-edge technologies in crop fields. Additionally, German farmers receive a yearly payment from the European Union for the investment they make in their fields. They can now purchase pricey contemporary machinery because of this. The market for agricultural machinery in the nation is heavily influenced by the aforementioned elements.
China’s Agriculture Equipment market size was valued at USD 15.02 billion in 2021 and is expected to reach USD 20.55 billion by 2029, at a CAGR of 4% from 2022 to 2029. Growing government-funded schemes and the inclination for farm mechanization are encouraging market expansion. The "Made in China 2025" initiative, which China introduced, seeks to produce 90% of its own agricultural equipment and hold a third market share by 2020 for high-end products such as farm tractors. This in turn stimulates the domestic tractor market, which includes agricultural tractors. In order to encourage agricultural mechanization, a number of regional regulatory organizations, including the China Agricultural Industry Mechanization Association, educate both co-operatives and individual farmers on the advantages of utilizing powerful tractors in bigger farm regions. Tractor sales are therefore being driven by the region's farmers' rapid development in farm mechanization, which is fostering the market's expansion.
India's Agriculture Equipment market size was valued at USD 13 billion in 2021 and is expected to reach USD 17.25 billion by 2029, at a CAGR of 3.6% from 2022 to 2029. The need for agricultural equipment in the region is fueled by the labor scarcity there. For instance, the National Rural Employment Guarantee Agency (NREGA) has caused a cascade effect that has resulted in farm mechanization in several locations due to a lack of labor. During the key sowing and transplanting season, the migration of seasonal migrant workers from Bihar and the UP to states like Haryana and Punjab has drastically decreased as a result of the adoption of this scheme. As a result, these states have seen a marked growth in the demand for agricultural equipment.
Key Application Players Analysis:
To increase their market position in the global agriculture equipment business, top companies focus on tactics such as adopting new technology, mergers & acquisitions, product developments, collaborations, partnerships, joint ventures, etc.
Latest Development:
Report Metrics
Report Attribute |
Details |
Study Period |
2021-2029 |
Base year |
2021 |
CAGR (%) |
5% |
Market Size |
156 billion in 2021 |
Projection period |
2022-2029 |
Projection unit |
Value (USD) |
Segments covered |
By Product, By Application, and Region. |
Report Scope |
Revenue Projection, competitive landscape, company ranking, growth factors, and trends |
Companies covered |
Amazone Inc., AGCO Corporation, FlieglAgro-Center GmbH, Agromaster, CNH Industrial N.V., APV GmbH, Bellota Agrisolutions, CLAAS KGaAmbH, Deere & Company, ISEKI & Co., Ltd., Escorts Limited, KUBOTA Corporation, KUHN SAS, HORSCH Maschinen GmbH, J C Bamford Excavators Ltd, Quivogne CEE GmbH (Kiwon RUS LLC), Rostselmash, KRUKOWIAK, among others |
By Product |
|
By Application |
|
Regional scope |
|
Scope of the Report
Global Agriculture Equipment Market by Product:
Global Agriculture Equipment Market by Application:
Global Agriculture Equipment Market by Region:
Global agriculture equipment market is expected to reach USD 230.48 billion by 2029, at a CAGR of 5% from 2022 to 2029.
Asia Pacific is anticipated to experience significant growth during the predicted period.
High cost of agriculture equipment is primarily impeding the growth of the agriculture equipment market.
Introduction of advanced technologies in the agriculture sector around the globe is Projectioned to influence the market in the Projection years.
Leading market players active in the global agriculture equipment market are Amazone Inc., AGCO Corporation, FlieglAgro-Center GmbH, Agromaster, CNH Industrial N.V., APV GmbH, Bellota Agrisolutions, CLAAS KGaAmbH, Deere & Company, ISEKI & Co., Ltd., Escorts Limited, KUBOTA Corporation, KUHN SAS, HORSCH Maschinen GmbH, J C Bamford Excavators Ltd, Quivogne CEE GmbH (Kiwon RUS LLC), Rostselmash, KRUKOWIAK.
Political Factors- Agriculture-related purchases, production, and prices are influenced by governmental policy. For instance, rules requiring the labelling of goods containing genetically modified organisms have been passed in the United States (GMOs). The government will support farmers through several good programs, which will help the sector expand. China, the United States, Brazil, India, Russia, France, Mexico, Japan, Germany, and Turkey are the leading agricultural producers in the world. These nations have distinct political beliefs, but they all share one thing in common: internal political stability. Agriculture machinery is becoming increasingly in demand as the agricultural industry develops. However, the Ukraine conflict has driven up the price of fuel, fertilizer, and animal feed, raising the cost of food.
Economical Factors- One of the largest industries in the world is agriculture. Many developing economies rely significantly on their agricultural sector to meet local demand. Additionally, they frequently need to import goods since native production cannot keep up with demand. However, industrialized countries like the USA, Germany, and some other EU countries also import a lot of agricultural goods. It is important to note that China is the biggest importer of agricultural products worldwide. Demand from consumers, global food production, and global export demand are all economic variables that have an impact on the agriculture equipment sector. These elements, as well as global prices, customer demand, and governmental policies affect how much agricultural machine components cost. The accessibility of particular raw materials, such as petroleum, steel, and others, has an impact on the sector.
Social Factor- More than a billion people worldwide are assumed to be employed in agriculture. Consequently, there is a rise in the need for agricultural equipment. In addition, a variety of social variables affect this sector. For instance, for cultural reasons, agriculture is particularly popular in China, India, Indonesia, Vietnam, and Bangladesh. Though most millennials are more interested in technology and the service sector than in agriculture. This has contributed to the widespread misconception that only persons from impoverished backgrounds should work in agriculture. Therefore, it takes both governmental and private initiatives to alter this negative perception of the agricultural sector. As labor costs fall, this also accelerates the development of agricultural equipment.
Technological Factors- The market for agricultural equipment requires ongoing technological innovation. In the next five years, it's anticipated that technical innovations like the usage of GPS, automation, artificial intelligence, and the internet of things will be brought to the agricultural industry, providing opportunities for companies that are technologically advanced. Numerous start-ups have emerged in India, including Bijak, Clover Ventures, and Bharat Agri, to help farmers become more technologically savvy. Aggregate effects on the agriculture equipment market are undoubtedly possible.
Environmental Factors- Climate has a significant impact on the demand for farm equipment because farmers are essential to the agriculture equipment sector and farmers' crops are largely dependent on climate. The demand has been increasing due to the pleasant weather and above-average monsoon in 2020, but one cannot completely rule out a negative in the event of an unfavorable monsoon or crop damage as a result of adverse weather in any given financial year. Farmers are looking for tools and scientific methods that will enable them to save crops under challenging weather conditions.
Legal Factors- Reforms to agricultural laws may be advantageous to the industry because private participants may decide to concentrate on technology and mechanization to achieve higher productivity instead of using human labor. However, because individual players may opt for B2B partnerships to use farm equipment, they could have a detrimental effect on equipment merchants. Given the growth of the market for farm equipment, this might still be advantageous. Laws governing pollution & emission limits also bind the market participants in the sector. These standards outline the emission levels for substances such as carbon monoxide, hydrocarbons, and particulate matter (PM).
List of Table
List of Figures