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The powered agriculture equipment market size is forecast to increase by USD 48.5 billion, at a CAGR of 4.91% between 2023 and 2028. The market is experiencing significant growth, driven by various factors. Government initiatives to support sustainable agricultural machinery practices are major catalysts, as governments worldwide invest in programs that promote the use of modern farming equipment and technologies. Another trend is the rising deployment of smart agricultural practices and technologies for precision farming, which enables farmers to optimize resource usage and improve crop yields. Additionally, the growing availability of rental agricultural equipment has made it more accessible for small-scale farmers and cooperatives, increasing market penetration. These factors, among others, are fueling the growth of the Powered Agriculture Equipment Market and are expected to continue shaping its trajectory in the coming years. Our report examines historic data from 2018 - 2022, besides analyzing the current and forecasts market scenario.
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The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.
The tractors segment will account for a major share of the market's growth during the forecast period.? The farm mechanization market in the agriculture sector has witnessed significant growth due to the increasing adoption of advanced equipment among family-size farmers and commercial entities. Guarantees from banks and lenders have facilitated the purchase of essential farm equipment, including tractors, harvesters, and production facilities, for both livestock and crop production. Farmers require loans for seeds, feed, and supplies, with maximum loan amounts varying based on land size and business scale. Loan programs like conservation loans have encouraged farmers to invest in new tractor sales and precision farming techniques, enhancing operational efficiency and productivity.
The tractors segment accounted for USD 59.00 billion in 2018. The rising wages and operational costs have necessitated the need for business growth through increased production. Hybrid and electric tractors, combines, and other agricultural equipment have gained popularity in the rental market, providing essential services during the downturn. Despite the high initial investment, the adoption of modern farming techniques and equipment guarantees long-term benefits, such as increased efficiency, productivity, and sustainability. The supply chain for agriculture equipment is crucial, ensuring timely delivery and maintenance services for optimal performance. The low penetration of precision farming techniques in developing economies presents significant growth opportunities for agriculture equipment manufacturers.
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APAC is estimated to contribute 46% to the growth during the forecast year. 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. Guarantees from banks and lenders facilitate the purchase of farm equipment such as tractors, harvesters, and combines for farmers, enabling them to enhance land cultivation, livestock management, and feed and seed supply efficiency. Commercial credit facilities, including loan programs, offer maximum loan amounts for farming operations, ensuring business growth and operational efficiency during periods of downturn. Precision farming techniques, including the use of hybrid and electric tractors, have gained popularity in the agriculture sector. These farming techniques guarantee higher productivity and lower operational costs. The rising wages for laborers have made equipment rental a viable option for small farmers. The agriculture equipment rental market caters to the essential services required for various agricultural activities. Despite the benefits, the penetration of farm mechanization remains low in many regions due to the high upfront costs. Conservation loans and production facilities, offering working capital, can help farmers invest in new equipment and production facilities, ensuring long-term business growth. The supply chain for agriculture equipment includes manufacturers, dealers, and service providers, all contributing to the operational efficiency and production capacity of the sector.
The market is witnessing significant growth, fueled by the increasing adoption of advanced technologies and precision farming techniques. This trend is particularly beneficial for small and family-size farmers, enhancing productivity and operational efficiency. With rising wages and a growing need for sustainable agriculture practices, there's a rising demand for environmentally friendly solutions. The market offers guarantees and commercial credit options through farm credit system institutions and lenders, facilitating access to land and livestock. Furthermore, the emergence of light-duty electric tractors and other powered equipment ensures low environmental impact, driving business growth and fostering innovation in the agricultural sector. The government initiatives to support sustainable agricultural practices is notably driving the market expansion, although factors such as the growing availability of rental agricultural equipment may impede the market growth. The holistic analysis of the drivers will help in predicting end goals and refining marketing strategies to gain a competitive edge.
Government initiatives to support sustainable agricultural practices is notably driving market growth. The agricultural sector is witnessing a shift towards advanced technologies and sustainable practices, driving the demand for powered agriculture equipment. In Europe, the implementation of Euro Stage IV regulations has led to the adoption of light-duty electric tractors and mobile applications for precision farming. Off-road vehicles and diesel tractors continue to dominate the farm equipment market, but the cost competitiveness and environmental impact of electric farm tractors are gaining momentum. In emerging nations like India, initiatives such as eNAM and Pradhan Mantri Krishi Sinchayee PMKSY are enhancing the availability of farming equipment to smallholder farms, reducing reliance on manual labor and draught animals.
Moreover, financial incentives and the adoption of cleaner transportation are further fueling the market growth. The farm tractor market is expected to expand significantly due to the need for versatility and adaptability in crop farming, especially on larger farms. Power rates and irrigation costs are major factors influencing the purchase expenses of these vehicles. Overall, the agricultural mechanization trend is leading to increased crop yields, improved traction, and higher revenue for farmers. Thus, such factors are driving the growth of the market during the forecast period.
Rising deployment of equipment and technologies for precision farming is the key trend in the market. Precision farming is a modern agricultural management system that utilizes advanced technologies such as global positioning systems (GPS) to optimize the use of field equipment, including irrigation systems, agrochemical sprayers, and weed control systems. This system enables farmers to communicate with their equipment in real-time, facilitating automated operations and minimizing input costs. The high profit potential of precision farming, derived from improved resource utilization and increased crop yields, is expected to fuel its commercial adoption during the forecast period. Off-road vehicles, such as light-duty electric tractors, are increasingly being adopted for precision farming due to their versatility and adaptability. Euro Stage IV regulations have led to the development of cleaner transportation options, making electric farm tractors an attractive alternative to traditional diesel tractors. The cost competitiveness of these vehicles, coupled with the availability of financial incentives, is further driving their adoption. The farm equipment market in emerging nations is witnessing significant momentum due to the increasing adoption of agricultural mechanization. The total tractor sales in these countries are expected to increase, driven by factors such as rising fuel costs, farm size, and the availability of manual labor and draught animals.
However, the high purchase expenses and vehicle costs are major challenges hindering the widespread adoption of precision farming equipment. Power rates and irrigation are significant factors influencing the profitability of precision farming. The adoption of precision farming is also expected to gain traction in crop farming due to its ability to enhance crop yields on an acre of land through the precise application of inputs. Overall, precision farming is a critical component of sustainable agriculture, offering cleaner transportation solutions and contributing to the reduction of the environmental impact of farming. Thus, such trends will shape the growth of the market during the forecast period.
Growing availability of rental agricultural equipment is the major challenge that affects the growth of the market. The agricultural equipment market is witnessing a shift towards advanced technologies, mobile applications, and rental services, particularly in emerging nations. Smallholder farmers, who often face financial constraints, are increasingly opting for rental services instead of purchasing outright. This trend, while boosting productivity and income for farmers, poses a challenge for equipment vendors. The long product replacement cycle, averaging around ten years, and the declining demand for new sales due to rental services, can impact their profitability.
However, the market for farm equipment, including diesel tractors and electric farm tractors, continues to show momentum, driven by the need for sustainable agriculture, versatility, and adaptability. The environmental impact, cost competitiveness, and cleaner transportation offered by advanced technologies, such as electric tractors, are also key factors influencing the market's growth. Power rates, irrigation, and traction requirements vary depending on farm size, and financial incentives, precision agriculture, and crop farming continue to be significant drivers in the market. Fuel costs and the availability of alternatives, such as manual labor and draught animals, also impact the market dynamics. Overall, the farm tractor market is expected to remain a significant contributor to the agricultural sector, with crop yields and acre of land being crucial factors in its growth. Hence, the above factors will impede the growth of the market during the forecast period
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.
The market research and growth report also has detailed analyses of the market's competitive landscape and offers information on key companies, including:
Alamo Group Inc., Autonomous Tractor Corp., CLAAS KGaA mBH, CNH Industrial NV, Deere and Co., EcoRobotix SA, Escorts Ltd., farming revolution GmbH, Harvest Automation, Harvest CROO Robotics LLC, ISEKI and Co. Ltd., Kinze Manufacturing Inc., Kubota Corp., Lovol Heavy Industry Co. Ltd., Mahindra and Mahindra Ltd., Tractors and Farm Equipment Ltd., Trimble Inc., Yamaha Motor Co. Ltd., Yanmar Holdings Co. Ltd., and Zetor Tractors as
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 is pivotal in driving farm mechanization across the agriculture sector, particularly benefiting family-size farmers and small farmers. Access to commercial credit from lenders and farm credit system institutions guarantees investment in tractors, harvesters, and other equipment, enhancing efficiency and productivity. The adoption of precision farming techniques optimizes agricultural activities, improving operational efficiency and fostering business expansion. However, challenges such as low penetration of advanced technologies persist, especially in regions with rising wages. The emergence of light-duty electric tractors reflects a shift towards sustainable agriculture, mitigating environmental impact while meeting the demands of modern farming practices. The rental market further facilitates access to equipment, ensuring the inclusivity of all farmers in the agricultural value chain.
The market is a cornerstone of modern farming, supported by financial institutions like a bank and farm credit system institutions offering loan programs tailored to farmers' needs. These loans cover expenses for livestock, feed, seed, and other essential supplies, with conservation loans promoting sustainable practices. The market sees an increase in new tractor sales driven by advancements in a farming technique and the introduction of hybrid & electric tractors, enhancing versatility and adaptability. Innovations in mobile applications streamline operations, optimizing the supply chain and ensuring timely delivery of equipment like combines and off-road vehicles. While the cost of electric tractors remains a consideration, their cost competitiveness against traditional diesel tractors is improving, bolstered by factors like lower fuel costs and maintenance expenses. As emerging nations ramp up their agricultural endeavors, the farm equipment market experiences steady expansion, revolutionizing farming practices and reducing reliance on manual labor.
Market Scope |
|
Report Coverage |
Details |
Page number |
144 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 4.91% |
Market growth 2024-2028 |
USD 48.5 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
4.42 |
Regional analysis |
APAC, North America, Europe, Middle East and Africa, and South America |
Performing market contribution |
APAC at 46% |
Key countries |
China, US, Japan, Germany, and India |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
AGCO Corp., Alamo Group Inc., Autonomous Tractor Corp., CLAAS KGaA mBH, CNH Industrial NV, Deere and Co., EcoRobotix SA, Escorts Ltd., farming revolution GmbH, Harvest Automation, Harvest CROO Robotics LLC, ISEKI and Co. Ltd., Kinze Manufacturing Inc., Kubota Corp., Lovol Heavy Industry Co. Ltd., Mahindra and Mahindra Ltd., Tractors and Farm Equipment Ltd., Trimble Inc., Yamaha Motor Co. Ltd., Yanmar Holdings Co. Ltd., and Zetor Tractors as |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, Market growth and Forecasting, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
Customization purview |
If our market growth analysis report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Opportunity/Restraints
10 Competitive Landscape
11 Competitive Analysis
12 Appendix
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