Agriculture Equipment Market Analysis North America, Europe, APAC, South America, Middle East and Africa - US, China, India, France, UK - Size and Forecast 2024-2028

Agriculture Equipment Market Size 2024-2028

The agriculture equipment market size is forecast to increase by USD 66.53 billion at a CAGR of 6.05% between 2023 and 2028. The market's growth hinges on several factors, including the rising demand for agricultural equipment prompted by labor shortages. Government subsidies aimed at bolstering the agricultural sector further fuel this growth trajectory. Additionally, the market sees an uptick with the increasing launch of new agricultural equipment by vendors, catering to the evolving needs of farmers and agricultural businesses. Our report examines historical data from 2018-2022, besides analyzing the current and forecasted market scenario.

Moreover, the agriculture equipment market in North America is propelled by government initiatives to mechanize farming and counter the growing farm labor scarcity, among other market-driving factors. AGCO Corp. contributes to this sector with its diverse offerings, including tractors and feeders branded as Challenger, Fendt, Massey Ferguson, Valtra, Fella, White Planters, and Sunflower.

Market Forecasting and Size

Market  Forecast 2024-2028

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Market Dynamics

The market encompasses a wide range of machinery crucial for modern farming operations, from farm tractors to sprayers and harvesters. With the rising population and increasing food consumable needs, agriculture equipment plays a pivotal role in threshing and harvesting, agro-processing, and distribution of fertilizers. Advanced equipment integrates IoT for precision farming, utilizing computer sensing to optimize tasks like seeding, spraying fields, and tilling fields. From specialty tractors for vineyard management to self-propelled spreaders for agro-based fuel application, these tools enhance efficiency and productivity while addressing challenges like soil nutrients and temperature of the soil for sustainable land development and maintenance. At the job site, the backhoe was used for harvesting crops and breeding cows, alongside feeding livestock, with fabricated elements contributing to operational efficiency.

Key Market Driver - Increasing demand for agricultural equipment due to labor shortage

The global rural population largely comprises the agricultural sector. There is an increasing trend of migration of labors from rural to urban areas, which raises the issue of a labor shortage in the countries such as India and South Africa. Rural areas in the US face 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. This has increased the demand for agriculture machinery even by small farmholders. Agriculture equipment offers efficient and time-saving farming.

Moreover, precision farming and fully automated farming adopted with the help of farming machines eliminate human interruption; thus, errors are also decreased. Such instances help farmers in yielding a high output of crops. Furthermore, easy access to this machinery encourages farmers to buy farming machinery. Therefore, farmers are switching toward capital-intensive resources for agricultural activities. Therefore, the demand for agriculture equipment is generated, which, in turn, will drive the growth of the market during the forecast period.

Significant Market Trends - Implementation of AI in Agriculture Equipment

Artificial technology (AI) is an emerging technology in the field of agriculture. AI-based agriculture equipment has taken the agriculture system to another level. AI technology has enhanced crop production and improved real-time monitoring of crop yield, irrigation, soil content sensing, crop- monitoring, weeding, and harvesting. The modern-day technology of automated systems involves the use of agricultural robots, and drones have made a remarkable contribution to the agro-based area. For example, Self-driving means automated tractors, which could feature autonomously and maximum commonly known as 'Driverless Tractors'. 

Further, potential applications of AI in farming lead to optimized usage of fertilizers, crop protection, and seeds. The cost of fertilizers and other crop protection chemicals exponentially rises, simultaneously increasing the demand for farm machines that could decide how much fertilizers are needed and reduce the wastage of such costlier chemicals. For instance, the increasing demand for agriculture equipment is significantly influencing the Argentina agriculture market, driving advancements in farming practices and boosting productivity across the region. Thus, such factors are expected to drive the growth of the market in focus during the forecast period.

Major Market Challenge - Growing availability of rental agricultural equipment

The various types of equipment used in agriculture include tractors, harvesting tools, mower conditioners, tillage tools, and other farming equipment. But many times, this is highly expensive, so not every farmer can afford to purchase it. The demand for agriculture tools renting services is driven by the high cost of maintaining modern agricultural equipment and the high cost of buying it. Utilizing rental services allows farmers to offset the expense of maintaining their agriculture tools while making a profit. Leasing agricultural machinery allows farmers to harvest their crops on schedule without having to make a sizable down payment on necessary agriculture equipment. 

Furthermore, the renting of farm machinery hinders the unit sales of new agriculture equipment and, thus, hampers the profitability of agriculture equipment. These losses have long-term repercussions as agriculture equipment has a product replacement cycle of nearly ten years. Such services in the market are likely to limit the adoption of agriculture equipment, which will hinder the growth of the market during the forecast period.

Market Segmentation by Type, Product Type, and Geography

The market encompasses a wide range of machinery and tools essential for various farming activities. These include tractors, combine harvesters, irrigation systems, mowers, and backhoes. As agro-based economies rely heavily on efficient farming practices, the demand for automation technologies to replace traditional farming methods and reduce dependence on the human workforce is growing. Factors such as commodity prices and weather patterns significantly influence the adoption of agriculture equipment, impacting land yield and the cultivation of crops like rice, wheat, maize, sugarcane, and oilseeds.

Type Segment Analysis: 

The tractors segment is estimated to witness significant growth during the forecast period. The demand for tractors will be driven by the rising preference for more sophisticated, larger, and more powerful models, many of which incorporate new technologies and amenities that contribute to their higher prices. On the other hand, the demand for smaller, specialized tractors for specific applications is also rising, which will have a restraining effect on value gains in the market.

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The tractors segment was the largest segment and was valued at USD 58.92 billion in 2018. The tractors included in this segment are wheeled and crawler types. Wheeled models of tractors will continue to gain popularity because of the simplicity of their design and the advantages that they provide over other tractor types under certain conditions. Additionally, wheeled tractors cost significantly less than many crawler-type machines. Tractors are classified based on their horsepower (HP). Small tractors with a capacity of less than 35 HP are used on small farms. Medium tractors with a capacity of 35-50 HP and big tractors with a capacity of more than 50 HP are used on large farms. Factors such as the growing shift toward mechanization and the decline in the number of people engaged in the agriculture industry are driving the adoption of tractors. Thus, increasing demand for tractors will drive the segment and market during the forecast period.

Product Type Analysis: 

Based on the product type, the market has been segmented into tractors, harvesters machinery, planting equipment and others. The product segment will account for the largest share of this segment.?Agriculture equipment is machinery used in agricultural works to save labor, cost, and time and to get a high crop yield. A few manual agriculture tools used under each stage include Land preparation: Several tasks need to be completed at this point, including preparing the soil bed, loosening the soil, and getting rid of weeds and clods to grind the soil. Currently, staple food products such as wheat, maize, and rice account for a major part of global calorie intake and, thus, require a significant increase in their production. Meat and milk are also important constituents of global food intake. Thus, a consistently increasing global population will drive agricultural activities, which, in turn, is expected to have a positive impact on the segment and market during the forecast period.

Regional Analysis

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North America is estimated to contribute 31% 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 in North America, particularly in the US and Canada, is dominated by key players like AGCO and Deere and Co. Government initiatives supporting mechanization, coupled with the farm labor shortage, are major market drivers. In the US, agencies like the USDA provide financial aid for tool purchases, boosting adoption. Deere and Co.'s recent product launches, including advanced technology for spraying operations, exemplify market trends.

In addition, with the US being a significant milk producer, rising hay production and exports are fueling demand for equipment like mower conditioners. The region's emphasis on innovation, particularly in autonomous tractors, presents growth opportunities. Overall, government support, technological advancements, and evolving agricultural needs are shaping the dynamic landscape of the market. Such factors are expected to drive the regional market growth during the forecast period. 

Who are the Major Market Companies?

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.

Alamo Group Inc. - The company offers agriculture equipment such as rotatory mowers, street sweepers, vacuum trucks, and stump grinders.

We also have detailed analyses of the market’s competitive landscape and offer information on 20 market companies, including AGCO Corp., Alamo Group Inc., American Spring and Pressing Works Pvt. Ltd., Beri Udyog Pvt. Ltd., CLAAS KGaA mBH, CNH Industrial NV, Deere and Co., ISEKI and Co. Ltd., Kinze Manufacturing Inc., Kovai Classic Industries, Kubota Corp., Mahindra and Mahindra Ltd., ROSTA AG, Shandong Heavy Industry Group Co. Ltd., Summit Steel and Manufacturing Inc., Tractors and Farm Equipment Ltd., Trimble Inc., Zetor Tractors as, EcoRobotix SA, 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.  

Segment Overview

The market research and growth report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Million" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.

• Type Outlook 
  • Tractors
  • Harvesters machinery
  • Planting equipment
  • Others

• Product Type Outlook 
  • Manual
  • Automatic
  • Semi-automatic

• Region Outlook 
  • North America
    • The U.S.
    • Canada
  • South America
    • Chile
    • Brazil
    • Argentina 
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

You may also interested in below market reports:

• India - Agricultural Machinery Market India - Agricultural Machinery Market by Product and Application - Forecast and Analysis 
• Farm Equipment Market Farm Equipment Market Analysis APAC, North America, Europe, South America, Middle East and Africa - US, China, Australia, France, Brazil - Size and Forecast
• US Agricultural Machinery Market US Agricultural Machinery Market by Application and Type - Forecast and Analysis

Market Analyst Overview

The market is witnessing significant advancements in modernized equipment and technologically advanced agricultural robotics, driven by the need for efficient equipment models to meet the demands of farming applications. With a focus on sustainable farming practices and reducing reliance on fossil fuels, manufacturers are exploring alternative fuel sources such as ethanol and biodiesel. Integration of Internet of Things (IoT) technology, sensors, and GPS in wireless equipment models enables IoT automation for tasks like plant protection and crop processing.

In addition, from cultivation equipment to harvesting equipment and irrigation & crop processing equipment, agricultural mechanization is evolving with semi-automatic machines and automatic machines. With precision agriculture techniques, including field contours mapping and soil nutrient measuring variables, the market aims for optimized crop yields and land utilization. Additionally, the rising demand for organic food and beverages drives the adoption of organic farming practices and sustainable agriculture technologies.

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What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the market between 2024 and 2028
• Precise estimation of the size of the market growth and trends and its contribution to the market in focus on the parent market
• Accurate predictions about upcoming market trends and analysis and changes in consumer behavior
• Market growth and forecasting across North America, Europe, APAC, South America, and Middle East and Africa
• A thorough market analysis and report of the market’s competitive landscape and detailed information about companies
• Comprehensive analysis of factors that will challenge the growth of market  companies

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