New Delhi, April 01, 2024 (GLOBE NEWSWIRE) -- The global agriculture equipment market is projected to reach US$ 565.8 billion by 2032, up from US$ 269.3 billion in 2023, at a CAGR of 8.6% during the forecast period 2024-2032.
The year 2020 saw global sales of agriculture equipment reach an impressive 2.45 million units, this figure poised to exceed 2.7 million units by 2029. India emerged as a dominant force in 2020, leading the way with 810,000 units sold. Powerhouses in the agriculture equipment market such as John Deere, CNH Industrial, AGCO, Kubota, and CLAAS are highly recognized for their production of tractors, with John Deere holding the title of the world's most esteemed tractor brand. Interestingly, the global tractor market experienced a 3.2% growth surge in 2023 compared to 2022. China and India remain the most significant markets for tractors, collectively accounting for over half of all global sales. In 2022, tractors with less than 40 horsepower held the lion's share of the market at 35.95%. Furthermore, the global agricultural tractor market was estimated to have reached a demand of 2,942.8 thousand units in 2022 and is anticipated to climb to a projected 3,105.0 thousand units in 2023. Notably, the 46-65 HP tractor segment has proved to be the most in-demand in the majority of regions.
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Key Findings in Global Agriculture Equipment Market
| Market Forecast (2032) | US$ 565.8 billion | |
| CAGR | 8.6% | |
| Largest Region (2023) | Asia Pacific (66.0%) | |
| By Equipment Type | Harvester and Thresher (57.1%) | |
| By Power Output | 70-130 HP (44.6%) | |
| By Application | Harvesting and Threshing (33.0%) | |
| By Drive Type | Two Wheel (77.3%) | |
| By Distribution Channel | OEM (82.4%) | |
| Key Countries Profiled |
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Harvesting and Threshing Equipment Leads: Combine Harvester Dominates
Harvesting and threshing equipment remain the cornerstone of the global agriculture equipment market, holding a significant 57.1% revenue share in 2023. This dominance is directly linked to the critical role these machines play in maximizing crop yields and ensuring efficiency – both essential factors in feeding a growing world population. However, the fertilizing and pest control machinery segment is rapidly gaining ground with a projected CAGR of 9.3%.
Harvesting and threshing equipment, spearheaded by combine harvesters, continue to be indispensable in the global agricultural landscape. The efficiency gains they provide – notably the ability to perform multiple harvesting steps simultaneously – are crucial for maximizing yields to serve growing populations. For instance, models like the John Deere S790 combine harvester offer harvesting widths of up to 4300mm in one pass and significantly reduce labor requirements (by 90-95%) compared to traditional harvesting techniques.
While self-propelled combine harvesters remain a popular choice in the global agriculture equipment market, tractor-powered combines offer a compelling alternative for many farmers. Their lower cost and versatility make them an attractive solution, especially for those with smaller operations or budget constraints. Case IH offers a range of tractor-powered combines, providing farmers with greater accessibility. The ability to utilize the tractor for other farm tasks throughout the year offers additional value and flexibility to farmers.
Specialized paddy threshers are an integral part of rice production. These threshers, with their spike-tooth cylinders, are designed to effectively separate rice grain from its straw. Manufacturers like Kubota offer various paddy thresher models, catering to the diverse needs of rice farmers across the globe. The demand for paddy threshers is directly tied to the prevalence of rice farming and continues to be a significant market segment, especially in rice-producing regions.
71-130 HP Power Dominates, Two-wheel Drive Agricultural Equipment Leads Global Agriculture Equipment Market
The 71-130 HP power range is the preferred choice for many farmers globally, accounting for 44.6% of the revenue share in 2023. This segment offers a balance of robust performance without the high costs associated with larger machinery, making it ideal for medium to large-scale operations. At the same time, there's strong growth in the demand for high-power output equipment (131-250 HP) with an estimated CAGR of 9.6%. This surge is predominantly fueled by the expansion of large-scale farms in India, China, Canada, and the US, where farmers require powerful machinery to manage vast fields efficiently.
Two-wheel drive agricultural equipment continues to be the most popular choice, holding a 77.3% share in 2023, especially in regions like Southeast Asia, due to its affordability, ease of maintenance, and versatility. However, four-wheel drive machines are becoming increasingly sought after with a projected CAGR of 9.6% from 2023-2031. Farmers are realizing the benefits of improved traction, stability, and efficiency, particularly in challenging terrain and wet conditions.
Increased Strain on Supply Chain Put Manufactures at Challenged Position
The global supply chain crisis has created a uniquely challenging environment for manufacturers in the global agriculture equipment market. The surge in demand for tractors and other equipment is colliding with production bottlenecks caused by component shortages, rising raw material costs, and logistical disruptions. Manufacturers like AGCO and CNH Industrial are reporting production delays and increased costs, while the limited availability of key components like semiconductor chips further complicates production. As a result, lead times for new equipment orders have stretched to 9-12 months for high-horsepower tractors – a significant increase from the typical 3–6-month window.
These delays ripple through the system. Dealerships are facing critically low inventories, with a 2021 survey revealing that 91% of U.S. agriculture equipment dealers have lower than normal new equipment stock. To fill the gap, the demand for used equipment has surged, but inventories there are also 30% below the previous 5-year average. This shortage of both new and used machinery creates a frustrating situation for farmers and leads to potential lost sales for dealers.
Manufacturers are taking proactive steps to combat these challenges. Strategies involve increasing vertical integration, finding alternative suppliers, employing data analytics for improved demand forecasting, and even offering rental or lease options for equipment to help farmers manage their immediate needs. However, the supply chain constraints are expected to continue well into 2022, keeping the pressure on the agricultural equipment industry.
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Asia Pacific to Contribute Staggering 66% Revenue to Global Agriculture Equipment Market
The Asia-Pacific region faces unique agricultural challenges. While it's home to more than half the world's population, it possesses only about one-fifth of the global agricultural land. This limited arable land, combined with inadequate water resources, creates a natural constraint on agricultural output. To overcome these resource constraints and meet the ever-increasing food demand, the region is witnessing a strong focus on farm mechanization. This shift promises to increase yields and efficiency, with projections indicating significant market growth due to this focus.
Governmental support is playing a crucial role in driving this mechanization in major countries like China and India. Financial incentives and subsidies are making modern agricultural equipment more accessible to farmers. This is particularly important in overcoming issues like labor shortages, boosting farm productivity, and supporting the growth of contract farming. Policy funding and specific incentives geared towards acquiring machinery are also contributing to the agriculture equipment market expansion within the Asia-Pacific region.
The results of this focus on agricultural mechanization are evident in productivity improvements. Notably, India achieved the highest agricultural total factor productivity (TFP) growth rate among South Asian countries, at an impressive 6.91%, with significant contributions from technical changes and mechanization. Pakistan, Bangladesh, and Nepal have also experienced positive TFP growth trends. While this progress is significant, it’s important to note that 86.8 million children in Asia under the age of 5 still suffer from stunting, underscoring the ongoing need for further advancements in productivity to ensure food security and nutritional health.
Global Agriculture Equipment Market Key Players
- AGCO Corporation
- Bellota
- China National Machinery Industry Corporation Ltd.
- CLAAS KGaA MBH
- CNH Industrial N.V.
- Deere & Company
- Escorts Limited
- Horsch Maschinen GmbH
- J.C. Bamford Excavators Ltd.
- Kubota Corporation
- Mahindra & Mahindra Ltd.
- MARUYAMA MFg., Co.Inc.
- Maschio Gaspardo S.P.A.
- Mater Macc S.p.A.
- Morris Industries Ltd.
- SDF S.p.A.
- TAFE
- Valmont Industries, Inc.
- Other Prominent Players
Key Segmentation:
By Equipment Type
- Soil Cultivation Machinery
- Cultivator
- Cultipacker
- Plough
- Rotary Tiller
- Harrow
- Others
- Planting Machinery
- Seed Drill
- Broadcast Seeder
- Seed cum fertilizer Drill
- Fertilizing & Pest Control Machinery
- Manure Spreader
- Slurry Tank
- Sprayer
- Irrigation Equipment
- Centrifugal Pumps
- Sprinklers
- Others
- Harvesting & Threshing Equipment
- Combine Harvester
- Sickle
- Mower
- Reaper
- Threshers
- Tractors
- Others
By Power Output
- <30 HP
- 31-70 HP
- 71-130 HP
- 131-250 HP
- >250 HP
By Drive Type
- Two-Wheel Drive
- Four-Wheel Drive
By Application
- Land Development & Seed Bed Preparation
- Sowing & Planting
- Weed Cultivation
- Plant Protection
- Harvesting & Threshing
- Post-Harvest & Agro Processing
By Distribution Channel
- OEM
- Aftermarket
By Region
- North America
- Europe
- Asia Pacific
- Middle East & Africa (MEA)
- South America
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