Agriculture Equipment Market Trends

Growth Drivers

• Declining areas for agriculture - As the labor force surges, the areas of arable land are decreasing globally, and this demand for several agriculture mechanisms and machinery, such as robots, along with a slated increase in large-scale farming. According to a report by Our World in Data in 2023, globally, in most of the countries, the land dedicated to cropland is observed to be lower than 20%, while several countries dedicate less than 10%.

• Government support in agriculture - The government has introduced several schemes, plans, and initiatives to promote agricultural activities and increase the usage of farm machinery and mechanized farming methods. According to a report published by the OECD in 2022, total agricultural support worldwide surpassed 817 billion every year from 2019 to 2021 in about 54 countries, which is an increase of about 13% from 720 billion in 2018 to 2020.
• Increase in automation - The use of fully automated machinery has boosted the production of the agricultural sector, and the amount of automation in these machines has increased as well. The agriculture equipment market growth has resulted tremendously from the use of tools with higher levels of automation. According to Research Nester analysis, in 2024, it was witnessed that automation has been adopted by more than 75% of companies that have registered a lucrative gain of about 10-12% in their productivity.

Challenges

• Low purchasing power with high cost - The machinery used in farming and agriculture is very expensive. Large capital investments are needed for equipment including cultivators, tractors, harvesters, crop sprayers, and trailers. Due to their limited purchasing power, many farmers-especially those from developing nations like Brazil, Indonesia, India, and South Africa—cannot afford such costly machinery. Because of this, rising agriculture equipment market like the Middle East and Latin America have less need for these machines. Therefore, it is anticipated that these factors will limit market expansion throughout the projected time.

• Decreasing farmland for agriculture- Farmlands have been converted into commercial buildings over time as a result of global urbanization trends. These farmlands are being utilized for commercial projects like shopping malls, hotels, and residences. The usage of farm equipment and agriculture is indirectly impacted by this. Driven by the small size of farmlands and the lengthy return on investment period, it has become difficult for individual farmers to acquire heavy equipment. Therefore, it is anticipated that these issues will impede the growth of global agriculture equipment market revenue in the near future.