The shifting focus toward modern agro-based practices as opposed to conventional methods has been fueling agriculture equipment market. Over the last few years, the increasing awareness among the farmers, regulatory bodies, and regional governments about the use of machines for increasing the overall food production has been propelling the demand for these products. The impact of climate change and the overuse of conventional agricultural practices have also resulted in a food crisis across the globe, prompting the deployment of sophisticated agro-based devices.
Germany agriculture equipment, by product, 2017 & 2024 (USD Million)
In order to combat the ongoing food crisis, governments of myriad geographies have been promoting the deployment of scientific and mechanized farming. As per estimates, by 2050, the world’s population would cross 9 billion, necessitating an excessive demand for food. Driven by the need of the hour to nearly double the agriculture output by 2050, the development of technologically advanced agricultural equipment has come to the fore. The usage of advanced agro-based components and the involvement of governments for promoting the use of modern agriculture facilities are slated to stimulate agriculture equipment industry size.
The use of resource-intensive farming systems has resulted in water scarcities, massive deforestation, and soil depletion, leading to the development of non-sustainable food production. In this regard, agriculture equipment developers are focusing on the development of innovative systems which can not only improve the productivity but also protect the environment. In accordance with the same line of thought, many farming product manufacturing startups have forayed into agriculture equipment industry.
For instance, in India, PAAMA Agrico has emerged as one of the most innovative and fastest growing agriculture equipment manufacturers which has been involved in research and development of robotic agricultural equipment. In line with its emphasis on advanced product development, it is working on the innovating world-class soil titling blades that could be used in cultivators and rotovators. The Indian economy is mostly dependent on income from agriculture and the rise in population is remarkably fueling the product demand. The launch of mechanized and innovative agriculture instruments could fulfil the demand for surging agricultural productivity, transforming the agriculture equipment market outlook.
In addition to technology giants, regional governments also have been continuously encouraging farmers to use advanced technologies over traditional farming methods. In this regard, recently, the Maharashtra state government has decided to provide a funding of nearly INR 50 crores to farmers to adopt mechanized farming. In addition, the Chief Minister of the state also announced the establishment of a technology hub in Maharashtra to promote scientific and mechanized farming. The government is aiming to double the farm production by 2022 in order to ensure adequate food security. The government also revealed that it will lend financial support to small and marginal farmers for purchasing tractors and other farming equipment. Initiatives such as these will help farmers tackle various farming challenges, eventually augmenting agriculture equipment market trends.
In most of the African countries, surging food insecurity and decreasing food production have emerged as challenges for the governments due to rise in population without the significant increase in agriculture productivity. Having identified the potential issues that may crop up in the future, African government bodies have been looking forward to implementing supportive regulatory policies to promote farming. The political commitment toward abolishing malnutrition and hunger across African countries is poised to have considerable influence on the overall agriculture equipment industry share.
The increasing focus of regional and international regulatory bodies on the agricultural industry will have a considerable impact on the overall agriculture equipment market trends over the years ahead. The sustainable development goals set by the regional governments to increase the outcome from the agriculture sector will further enhance the future product demand. Supported by a favorable regulatory scenario, giants in the agriculture equipment industry have been working to tap numerous business opportunities across the globe.
It is prudent to mention that even startups have now begun to adopt advanced product development strategies and have been active in conducting intense research and development activities. This would eventually lead to agriculture equipment market gaining commendable traction in the years ahead, with a projected CAGR of 6% over 2018-2024.