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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.
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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