Global Agriculture Equipment Market Sales Revenue to Surpass $519.44 Billion
The global Agriculture Equipment Market is expected to grow at a compound annual growth rate (CAGR) of 8.6% from 2023 to 2031. The growth is driven by the increasing demand for food due to population growth, coupled with the adoption of advanced farming techniques. Tractors are the most widely used agricultural equipment, followed by harvesters, cultivators, and planters. The Asia-Pacific region is expected to be the fastest-growing market due to the increasing demand for food in emerging economies such as India and China.
New Delhi, April 17, 2023 (GLOBE NEWSWIRE) — The global Agriculture Equipment Market reached a valuation of US$ 257.07 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 8.6% during the forecast period from 2023 to 2031. By 2031, market revenue is estimated to reach an impressive US$ 519.44 billion, as farmers increasingly turn to advanced equipment and technology to boost yields and streamline operations.
Global agricultural output has been growing steadily, but this growth has been insufficient to meet the increasing food demand. The widespread adoption of modern agricultural equipment and practices will play a critical role in achieving the FAO’s target of increasing global agricultural production by 70% by 2050.
The current demand for agricultural equipment is on the rise, driven by factors such as the growing global population, increasing food consumption, and the need to improve agricultural productivity. The market is witnessing a surge in demand for advanced equipment such as tractors, combine harvesters, irrigation systems, and precision farming technologies.
The global food demand is increasing rapidly, with the demand-supply gap widening in the global Agriculture Equipment Market. According to the FAO, global agricultural production needs to increase by 70% by 2050 to feed the growing population. The demand for food and agricultural products is expected to increase by 50% by 2030, according to a report by the World Bank. As a result, there is an ongoing shift toward modern agricultural practices, including precision farming, automation, and data-driven decision-making. These practices have proven to improve crop yields, reduce waste, and optimize resource usage. Farmers are increasingly adopting technologies such as drones, sensors, and satellite imagery to monitor crop health, soil conditions, and weather patterns. This shift toward modern farming practices has fueled the demand for sophisticated agricultural equipment.
The global food demand is increasing rapidly due to factors such as population growth, urbanization, and changing consumption patterns. The demand-supply gap is widening, with current agricultural production unable to keep pace with the growing demand for food. As a result, there is a need to increase agricultural productivity and make the best use of available resources.
Agricultural equipment plays a crucial role in enhancing agricultural productivity and bridging the demand-supply gap. Modern farming equipment and practices have the potential to increase crop yields, reduce labor requirements, and optimize resource usage. Advanced machinery and technologies such as precision farming, drones, and automated systems can help farmers produce more food with fewer resources, ultimately contributing to food security.
Precision farming is a farming management concept that involves using modern technology to improve crop yield and reduce waste. It involves the use of advanced equipment, such as sensors, GPS, and drones, to gather data on soil conditions, crop growth, and weather patterns. The data is then analyzed to optimize crop management decisions, such as planting, fertilization, and irrigation.
The adoption of precision farming has been steadily increasing over the years, driven by the need to increase crop yield and reduce costs. This trend has led to a surge in demand for agricultural equipment that can support precision farming practices. According to a report by Astute Analytica, the Agritech market is expected to grow at a CAGR of 19.2% and generate a revenue of $64 billion by 2031.
One of the key advancements in precision farming technology across the global Agriculture Equipment Market is the use of autonomous equipment. Autonomous tractors, for instance, can be programmed to operate in specific areas of a field, perform specific tasks, and avoid obstacles. This reduces the need for manual labor and helps farmers save time and money. The use of drones is also becoming increasingly popular in precision farming, as they can be used to monitor crop health, identify areas that need attention, and gather data on weather patterns.
The adoption of precision farming practices has also led to an increased demand for variable rate technology (VRT) equipment. VRT equipment can adjust the rate of application of inputs, such as fertilizers and pesticides, based on real-time data. This helps farmers optimize crop yield while reducing waste and environmental impact.
The global Agriculture Equipment Market is divided into several segments based on equipment type, power output, drive type, and distributor channel. Among the major categories of equipment type are planting and fertilizing equipment, harvesting and threshing equipment, irrigation and crop processing equipment, and others. The harvesting and threshing equipment segment is expected to be the top revenue generator, accounting for over 57% of the market. This is due to the adoption of advanced technologies, including autonomous harvesters, which enhance efficiency and reduce manual labor during the harvesting process.
Regarding power output, the market is segmented into less than 30HP, 31-70HP, 71-130HP, and more than 130HP. The 71-130HP segment is projected to dominate the market, accounting for over 44% of the market’s revenue. This is because mid-range tractors provide a balance of power, performance, and affordability, making them a popular choice among small to medium-sized farmers. Furthermore, the trend towards mechanization in agriculture has driven the demand for mid-range tractors, as farmers strive to decrease manual labor and enhance efficiency.
The drive type segment includes two-wheel drive and four-wheel drive. Two-wheel drive machines are more cost-effective and are suitable for use in smaller farms, making them the preferred choice among farmers with limited land. The two-wheel drive segment is anticipated to hold the largest share of the Agriculture Equipment Market, accounting for 75% of the market’s revenue. However, the trend towards precision agriculture has increased the adoption of autonomous and four-wheel drive machines, as these technologies can assist farmers in optimizing crop production and reducing waste.
The distributor channel segment of the global Agriculture Equipment Market is classified into OEMs and aftermarket. The OEM segment is anticipated to generate over 82% of the market’s revenue, due to the high level of trust and reliability associated with OEM products, as well as the extensive distribution networks of major manufacturers. OEMs offer a range of agricultural equipment, from tractors and harvesters to irrigation systems and fertilizers, providing farmers with a one-stop-shop for their agricultural needs. Additionally, the growing trend towards precision agriculture has increased the demand for advanced technologies, which are usually only available through OEMs.
Top 5 Players Generate Over 55% Revenue of Global Agriculture Equipment Market
The global Agriculture Equipment Market is highly competitive, with numerous companies offering a wide range of products to meet the needs of farmers worldwide. However, the market is largely dominated by a few major players, and in 2022, the cumulative market share of the top five players was approximately 55%, indicating an oligopoly.
Deere & Company, also known as John Deere, is the largest player in the market, with a revenue share of over 23%. The company’s strong brand reputation, advanced technology, and extensive distribution network have helped it maintain its dominant position in the market.
Other major players in the Agriculture Equipment Market include Kubota Corporation, CLAAS KGaA MBH, CNH Industrial N.V. and China National Machinery Industry Corporation Ltd, each of which holds a significant share of the market. These companies also have a strong brand presence and offer a diverse range of products and solutions for the agricultural sector.
In terms of product offerings, the major players in the market offer a wide range of agricultural equipment, including tractors, harvesters, planting equipment, and irrigation systems, among others. These companies are also investing heavily in research and development to develop more advanced and efficient equipment to meet the growing demand for sustainable agriculture practices.
Most Recent Developments in Global Agriculture Equipment Market
- In 2021, Deere & Company launched several new products, including the X Series Combines, which feature improved automation, greater capacity, and increased efficiency. The company also introduced new sprayers, cotton pickers, and self-propelled windrowers, among other products.
- In 2020, Deere & Company launched the 8RX Tractor, which is the company’s first four-track tractor, designed to provide greater flotation and traction on the field. The company also introduced the X9 Combine, which has a capacity of up to 100,000 bushels and is designed to increase harvesting efficiency.
- Kubota, a leading manufacturer of agricultural equipment, has announced plans to invest over $1.2 billion (Rs 9400 crore) in Escorts Limited, a major tractor manufacturer in India. The investment will make Kubota the largest promoter in Escorts Limited and is aimed at strengthening the two companies’ collaboration in the global agricultural machinery market.
- AGCO Corporation acquired 151 Research, a technology company specializing in artificial intelligence, data analytics, and precision farming. The acquisition will help AGCO to enhance its precision farming capabilities and improve the efficiency of its equipment.
- Deere & Company, largest player in the Agriculture Equipment Market, acquired Bear Flag Robotics, a startup that develops autonomous driving technology for tractors. The acquisition will help Deere to accelerate the development of its autonomous equipment and increase efficiency in farming operations.
- CNH Industrial announced a partnership with Microsoft to develop advanced digital solutions for agriculture. The partnership aims to leverage Microsoft’s expertise in artificial intelligence and the internet of things to enhance CNH’s precision farming capabilities.