Global Farm Equipment Market Size, Growth, Opportunities Analysis, And Forecast To 2027
Bharat Book Bureau Provides the Trending Market Research Report on “Farm Equipment Market by Tractor Power Output (<30, 31-70, 71-130, 131-250, >250HP), Tractor Drive Type, Autonomous Tractor, Electric Tractor (Hybrid, Electric), Farm Equipment (Combine, Baler, Sprayer), Implement, Rental & Region - Global Forecast to 2027” under the Automotive Market Research Report Category. The report offers a collection of superior Market research, Market analysis, competitive intelligence, and Market reports.
The global Farm Equipment Market is projected to grow from USD 99.4 Billion in 2021 to USD 126.0 Billion by 2027, at a CAGR of 4.0% during the forecast period. There has been a significant increase in farm equipment production over the years. However, in 2020, factors like COVID-19, limited supply of farm equipment parts, drop in the first half of new tractor sales, the shutdown of production facilities, and a decline in working capital, resulted in the decline in global farm equipment production.
However, manufacturing facilities, opening of international borders, and government support to the agricultural industry are likely to restore momentum to a great extent by the end of 2020. The global economic recovery is also expected to be fueled by the higher production of vaccines and vaccination rates, allowing businesses to reopen more quickly.
The implementation of farm loan waiver schemes encourages farmers to buy farm equipment. Governments launched various schemes in different parts of the world to relieve farmers from their loans and encourage farm mechanization.
Government subsidies play an essential role in the agriculture sector of a country. For instance, the US Farm Service Agency (FSA) provides guaranteed and direct farm ownership and operating loans to family-size farmers who cannot obtain commercial credit from a bank, farm credit system institution, or other lenders. FSA loans can also be used to purchase land, livestock, equipment, feed, seed, and supplies. The US department of agriculture also announced various loan programs, including direct farm ownership down payment program. The maximum loan amount increased from USD 250,000 to USD 300,000, and the guaranteed amount on conservation loans increased from 75 to 80%. The government spends heavily on various subsidies to drive the agricultural sector every year. As farm equipment such as tractors, combines, and harvesters are expensive, it is challenging for farmers to purchase this equipment with their limited funding sources. Therefore, several governments have increased their support through subsidies/credits to encourage farmers to adopt modern farming equipment to increase food production.
Various OEMs launched retail financing programs with customized dealers and rental operations solutions. In March 2021, John Deere launched the financial incentives schemes for the dealers for the sale of new equipment. In 2021, CLAAS launched a program for 2022 orders with incentives to help manage supply chain disruptions. The company also offers pre-sell program incentives, including low financing rates and early order discounts on their equipment.
AGCO provides its dealers with volume sales incentives, demonstrations, and other advertising support to assist sales. It designs its sales programs, including retail financing incentives and policies to maintain the availability of parts and services, with extensive product warranties, to enhance the competitive position of its dealers.
In 2021, Kubota launched a special offer for compact tractors, including USD 0 down, 0% APR for up to 84 months, and savings up to USD 1,200 on LX Series Tractors. In 2019, the company retained the services of FMI, an incentives and events agency based in Buckinghamshire, to develop a new dealer incentive program named the Kubota Rewards Club.
Thus, these incentives schemes for purchasing farm equipment from the OEMs are expected to increase the production and sales of farm equipment during the forecast period.
“The 31-70 HP segment is expected to lead the Power Output segment due to the higher demand for these tractors across the globe.”
The 31-70 HP segment is estimated to lead the market, in terms of value, during the forecast period due to higher demand for these tractors in China, India, and the US. Government subsidies, loan waivers, and policies are expected to encourage farmers to buy high-powered tractors rather than traditional low-powered tractors. The increasing farm mechanization in emerging countries driven by government efforts is expected to drive the market. The rising demand for high-powered tractors and the growing network of dealers with proper marketing are other factors expected to boost the market globally.
Four wheel drive segment to grow at the fastest CAGR from 2021 to 2027
The demand for four-wheel drive tractors is expected to grow in the future with the changing requirements in farming activities such as covering a larger acre of land or the need to pull large-size implements. The availability of low-powered tractors with four-wheel drive is expected to be a major factor for their growing demand. John Deere Model 5050 D is a low-powered tractor that delivers 50 HP and is available in four-wheel drive. In 2021, Sonalika Tractors (India) launched its advanced Tiger DI 75 four-wheel drive tractor with CRDs (Common Rail Diesel System) technology. Sonalika has also introduced the Tiger DI 65 four-wheel drive tractor customized with twin benefits to deliver 65 HP power and an economy of 55 HP. Both the new models are available in 4W and 2W drive versions.
Asia Oceania is projected to be the highest growing regional market
For the market analysis, the Asia Oceania region includes India, Japan, China, South Korea, Australia, and Rest of Asia Oceania. The increasing farm mechanization driven by government efforts and subsidies/loan waivers is expected to drive farm tractor sales in India. However, China has witnessed a decline in tractor sales in 2020 and 2019, owing to delays in farm equipment subsidies in the Chinese provinces and the upgradation of emission regulations.
In addition to high containerized transportation, factors such as increasing Gross Domestic Product (GDP), infrastructure investments, rising per capita income, growing inclination toward mechanization, and government initiatives for FDI have created more opportunities for the farming business, in turn driving the farm tractor market in the Asia Oceania region.
In-depth interviews were conducted with CEOs, marketing directors, other innovation and strategy directors, and executives from various key organizations operating in this market.
•By Company Type: Farm equipment OEM – 100%
•By Designation: C Level - 30%, Directors- 50%, and Others – 20%
•By Region: Asia Oceania - 40%, Europe - 30%, North America –5%, and RoW-25%
John Deere (US), AGCO Corporation (US), CNH Industrial (Netherlands), Kubota Corporation (Japan), and CLAAS (Germany) are the prominent players in the farm equipment market.
The study segments the farm equipment market and forecasts the market size based on power output (250 HP), drive type (two-wheel drive and four-wheel drive), farm implements, by function (plowing & cultivating, harvesting & threshing, sowing & planting, plant protection & fertilizing, and others), farm equipment rental, by equipment type (tractors, combines, sprayers, balers, and others), farm tractor rental market by power output 250 HP), farm tractor rental market, by drive type (two-wheel drive and four-wheel drive), autonomous tractor market, autonomous tractor market, by power output (100 HP), electric tractor market, by propulsion (battery electric and hybrid electric) and region (Asia Oceania, North America, Europe, and the Rest of the World [RoW]).
The study also includes an in-depth competitive analysis of the major farm equipment manufacturers in the market, along with their company profiles, key observations related to product and business offerings, recent developments, and key market strategies.
Key Benefits of Buying the Report:
The report will help the market leaders/new entrants in this market with the information on the closest approximations of the revenue numbers for the overall farm equipment market and the sub-segments. This report will help stakeholders understand the competitive landscape and gain more insights to better position their businesses and plan suitable go-to-market strategies. The report also helps stakeholders understand the market's pulse and provides them information on key market drivers, restraints, challenges, and opportunities.
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