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The agricultural machinery market size to increase by USD 47.71 billion, at a CAGR of 5.5% between 2023 and 2028. The market growth analysis depends on several factors, such as government subsidies to promote the agricultural sector, the expansion of arable land, and the high labor shortage in farming. Our market report examines historic data from 2018-2022, besides analyzing the current and forecasts market scenario.
The APAC region is experiencing a surge in demand for agricultural mechanization, driven by government initiatives like subsidies and improved credit access. Farmers are investing significantly in machinery, boosting APAC market growth. Bucher Industries AG provides agriculture machinery through its business unit Bucher Landtechnik which offers tractors, Combine Harvesters, Sprayers, and others.. CHANGFA GROUP offers agriculture machinery such as wheel tow, wheeled harvesters, rice transplanters, rotary machines, feed crawler combine harvesters, and others.
Market Forecast 2024-2028
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Our researchers studied the market research and growth data for years, with 2023 as the base year and 2023 as the estimated year, and presented the key drivers, trends, and challenges for the market.
The global rural population largely comprises the agricultural sector. There is an increasing trend of migration of laborers from rural to urban areas, which raises the issue of a labor shortage in countries like India and South Africa. Rural area in the US faces acute shortages of agriculture labor, especially in Ohio and Pennsylvania. Also, many local workers are not interested in doing farm-related work, which has increased labor shortages. Thus, the labor shortage has gradually increased the labor cost in the country over the years.
Furthermore, programs like AI4AI and easy access to these machinery are encouraging farmers to buy farming machinery. Therefore, farmers are switching toward capital-intensive resources for agricultural activities. Therefore, the demand for agricultural machines is generated, which, in turn, will drive the growth of the market during the forecast period.
With the advancement in technology, modernized features are used in farms like GPS for precision plowing, field mapping, planting, and fertilizing with accurate seed placement. Some tractors are also equipped with attached on-board computers. Precision farming also uses machinery with these devices, which improves profitability and productivity. For instance, Deere and Co. tractors have a system, where the driver coordinates with the grain cart movements while harvesting. In the case of any failure, the sensor sends alerts to farmers and local dealers. Major companies such as Bucher Industries AG and AGCO Corp. have started using precision farming and planting practices.
Moreover, some of the features of precision farming include equipment guidance, yield inspection, and variable rate input application, which increase farm yield. This, in turn, drives vendors to develop farm equipment tailored for precision farming. For instance, in November 2023, xFarm Technologies partnered with Precision Farming Network (PFN) to offer technologically advanced, connected agricultural machinery to farmers. These advancements are expected to boost the Indian agricultural machinery market during the forecast period, as they cater to the growing demand for efficient farming practices and enhanced productivity.
The growing focus by countries on fighting climate change and making farming operations cleaner and greener has compelled environmental bodies worldwide to come up with stringent emission regulations. Environmental regulatory bodies across the world have imposed strict emission norms for factories, vehicles, production facilities, waste management, machinery, and equipment. The environmental governing body of the EU has announced the Stage V exhaust emission regulations that limit the emissions of particulate matter (PM) to 0.015 g/kWh, and the oxides of nitrogen (Nox) to 0.4 g/kWh.
Consequently, the need to comply with the new and strict emission regulations introduced by various countries has affected the profit margins of various farm equipment manufacturers adversely. The design and manufacturing of machinery that complies with the new norms make it necessary for manufacturers to equip the machinery with new components, resulting in additional costs. Subsequently, this increase in costs will increase the prices of such machinery and thus have a negative impact on its demand and may impede the growth of the market during the forecast period.
The tractors segment will account for a major share of the market's growth during the forecast period.?The demand for agricultural tractors is high in developing countries such as India and China. Tractors are classified based on their horsepower (HP). The demand for low HP tractors is mainly from developing countries such as India and China, and the demand for high HP tractors is mainly from developed countries such as the US. High HP tractors are mainly used to control other agricultural equipment, such as planters, air seeders, and tillage machines in large farms. Factors such as a shift toward mechanization and a reduction in the number of people in the agricultural industry are increasing the adoption of tractors.
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The tractors segment was valued at USD 103.62 billion in 2018. Furthermore, market players such as Deere and Co. provide customized tractors to suit the specific needs of end-users. End-users can design their own tractors to suit their needs by choosing the proper attachments and other features, such as backup alarms and rotary beacon lights. Some of the most important market players offering tractors are Mahindra and Mahindra Ltd., Deere and Co., AGCO Corp., Sonalika International Tractors Ltd., Escorts Ltd., etc. Factors such as the growing shift toward mechanization in the agriculture industry are driving the adoption of tractors. Therefore, the tractor segment is expected to grow in the global agricultural machinery market during the forecast period.
Based on application, the market has been segmented into land development and seedbed preparation, sowing and planting, harvesting and threshing, and others. The land development and seedbed preparation?segment will account for the largest share of this segment.?Land development and seedbed preparation is considered one of the complicated processes that entail evaluations, planning, designing, and constructing modifications on a plot of land with the municipal and government norms and regulations. Some of the essential and most commonly used agriculture machinery for land development include rotavators or rotary tillers, plows, tractor-trailers, power harrows, levelers, and disc hallows. Additionally, increasing instances of soil degradation and loss of arable land are likely to promote land development practices with the help of agricultural machinery among the farmers. Therefore, the growth of the land development segment of the market will witness a positive trend during the forecast period.
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APAC is estimated to contribute 42% to the growth by 2028. Technavio's analysts have provided extensive insight into the market forecasting, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period. The market generates a major part of its revenue from APAC mainly because of the growing population in this region, which gradually boosts the demand for food. Developing countries such as India and China are the major contributors to the market in APAC.
Further, India is one of the largest contributors to the global agricultural machinery market, despite low farm mechanization. This is because of the fragmented agricultural lands in the country. In addition, the popularity of low-priced agricultural tractors in India is higher due to the financial instability among small and mid-sized farmers. Further, government support to farmers in the region for buying agricultural machinery helps them to avail equipment at low costs.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
We also have detailed analyses of the market’s competitive landscape and offer information on 20 market companies, including:
Changzhou Dongfeng Agricultural Machinery Group Co. Ltd., China National Machinery Industry Corp. Ltd., CLAAS KGaA mBH, CNH Industrial NV, Daedong Corp., Deere and Co., Escorts Ltd., Tractors and Farm Equipment Ltd., HORSCH Maschinen GmbH, ISEKI and Co. Ltd., J C Bamford Excavators Ltd., Kubota Corp., Mahindra and Mahindra Ltd., SDF SpA, Sonalika International Tractors Ltd., Weichai Lewo Intelligent Agriculture Technology Co., Ltd., and Yanmar Holdings Co. Ltd.
Technavio market forecast the an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies companies into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Companies are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.
The market analysis and report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
The agricultural equipment market is undergoing a transformative phase, influenced by various factors including Farmers' income and Climatic conditions. Government initiatives such as Loan waiver schemes are driving investments in advanced technologies like Agricultural robotics and Autonomous tractors. Emerging technologies like Flying drones and Robotic systems are revolutionizing farming practices, supported by modern Manufacturing facilities and advancements in Semiconductors and Sensor technologies. Despite challenges such as Production delays and Lack of human resources, the market is witnessing growth fueled by Global demand for food and the need for Sustainable agriculture solutions.
Further, easy credit and funds facilitate access to modern machinery, including Technologically advanced tractors and Smart agriculture equipment, catering to evolving needs in Meat production, Milk production, and Crop production. Regulatory compliance, including European Union directives and EMC compliance standard, ensures the quality and safety of agricultural machinery, meeting Regulatory scrutiny and Product testing requirements.
Additionally, advancements in GPS software products, Telematics, and Google Earth navigation systems optimize farm operations amidst changing Land usage patterns and Urbanization trends, driving the adoption of Tech-driven agriculture machineries across the globe.
Agricultural Machinery Market Scope |
|
Report Coverage |
Details |
Page number |
184 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 5.5% |
Market growth 2024-2028 |
USD 47.71 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
4.91 |
Regional analysis |
APAC, Europe, North America, South America, and Middle East and Africa |
Performing market contribution |
APAC at 42% |
Key countries |
US, China, India, Indonesia, and Brazil |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
AGCO Corp., Bucher Industries AG, CHANGFA GROUP, Changzhou Dongfeng Agricultural Machinery Group Co. Ltd., China National Machinery Industry Corp. Ltd., CLAAS KGaA mBH, CNH Industrial NV, Daedong Corp., Deere and Co., Escorts Ltd., Tractors and Farm Equipment Ltd., HORSCH Maschinen GmbH, ISEKI and Co. Ltd., J C Bamford Excavators Ltd., Kubota Corp., Mahindra and Mahindra Ltd., SDF SpA, Sonalika International Tractors Ltd., Weichai Lewo Intelligent Agriculture Technology Co., Ltd., and Yanmar Holdings Co. Ltd. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by Application
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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