Agricultural Tractor Market Size, Share, Opportunities, And Trends By Engine Power (Less Than 40 HP, 41 To 100 HP, More Than 100 HP), By Type (Utility Tractors, Row Crop Tractors, Orchard Type, Industrial Tractors, Other Tractors), By Vehicle Type (Gasoline And Diesel, Electric), By Mode Of Operation (Manual Tractor, Autonomous), And By Geography - Forecasts From 2024 To 2029

The agricultural tractor market is evaluated at US$59.829 billion for the year 2022 growing at a CAGR of 5.58% reaching the market size of US$87.502 billion by the year 2029.

The need for smaller tractors on small farms is expected to increase, and technical developments like the incorporation of telematics with agricultural tractors are expected to boost growth. Additionally, due to the quick adoption of mechanization, it is projected that the industry will grow favourably during the next few years. Moreover, tractor production is also being aided by the government's enhanced support of farm mechanization for high yield through the provision of subsidies. Additionally, technical developments are supporting the expansion of farm mechanization and increasing farmer awareness of its advantages.

Increasing farm mechanization

The need for tractors is rising as a result of precision farming and the growing use of farm technologies to increase production. Agricultural machinery can benefit from the use of high-precision positioning systems (such as GPS and GNSS), automated steering systems, geomapping, sensors, and remote sensing, as well as integrated electronic communication. Moreover, the tractor business is also being driven by the rising number of farm training programs that encourage the widespread use of agricultural machinery. These tractors' engines, which have a maximum capacity of 1,500 CC, enable them to be used more versatilely and occupy less space. Because they are simpler to customize, manufacturers are more likely to experiment with new parts and technologies in the agricultural tractor market before moving on to more powerful ones. Soft soil environments, such as those found in river basins, are ideal for low-horsepower tractors. The majority of uses for tractors with less than 40 HP are in horticulture.

Moreover, the increasing number of farm education courses that promote the widespread use of machinery for agriculture is another factor propelling the tractor industry. Tractors with engines no bigger than 1,500 CC take up less room and are more adaptable in their applications. Because they are easier to customize, manufacturers are more willing to experiment with new parts and technologies in this market before moving on to more powerful ones. Tractors with low horsepower are effective in areas with soft soil, like river basins. Horticulture is the primary use for tractors with less than 40 horsepower. Because labour costs are high and farmers have limited disposable income, there is a strong demand for lower-horsepower tractors in developing nations.

High demand for 40 HP and 100 HP

It is ascribed to an increase in developed market demand for these tractors, especially from the US Japan and Germany. Higher income levels tech-savvy producers and well-established after-sales services are expected to sustain this segment's growth over the forecast period. The market for high-power tractors for farms bigger than 10 hectares is expected to grow during the course of the forecast period driving the segment. Nonetheless farmers operating costs have already increased due to the rise in diesel prices and this is anticipated to be one of the primary issues throughout the forecast period. India presently outsources semiconductor devices and chips to the automotive industry in addition to other industries. In response, the government announced a USD 10000 package to assist businesses in setting up manufacturing facilities in India and to alleviate the shortage of semiconductors in that country. In the upcoming years, there should be a further increase in the production of domestic components as a result of the policy encouragement of semiconductor chip production and refinement.

Precision Farming Adoption Increases Demand for Agriculture

Farmers must prioritize efficacy and effectiveness in order to fuel business success as the agriculture sector is constantly under pressure to produce enough food to feed the world's expanding population. Precision farming is being adopted by more and more farmers who want to produce more with less. The global food shortage issue can be successfully resolved with the help of this farming technology. Farmers can reduce the difference between the supply and demand of agricultural products by using this technology to increase productivity and optimize operational efficiency. By maximizing the use of resources like water seeds soil nutrients and farm equipment precision farming technology increases yields and improves quality.

The rising trend of developing a virtual world in the metaverse

Agricultural tractor is commonly used by AI developers to generate gaming settings and new virtual worlds. It allows virtual reality (VR) developers to construct an infinite number of unique and immersive gaming worlds. As a result, application use cases such as VR gaming and VR training simulations are highly efficient. As a result, the earliest AI deployments in business will most likely concentrate on enhancing human AI with a workforce (human employees collaborating with intelligent virtual assistants or cobots). This will considerably boost market expansion throughout the world. For example, NVIDIA has announced a substantial update to its NVIDIA OmniverseTM platform, which includes new foundation apps and services for developers and industrial companies to optimize and enhance their 3D processes using the OpenUSD framework and agricultural tractor in August 2023.

Asia Pacific is witnessing exponential growth during the forecast period

China, Japan, and India are the top three countries in the Asia-Pacific region in terms of tractor sales. Agriculture in China is mechanized to a degree of about 60%. Small tractors are gradually replacing large and medium-sized tractors, according to data from China's National Bureau of Statistics. The employment of both human and animal labour in India's agriculture industry has significantly decreased.

The traditional agricultural process has given way to a more mechanized one as a result of the substitution of fossil fuel-powered vehicles, such as tractors and diesel engines. The Indian government is encouraging 'Balanced Farm Mechanization' to boost mechanization levels by offering subsidies on different types of equipment and facilitating bulk purchases through front-end agencies.

Market key launches

• In February 2024, Mahindra unveiled two new tractors: the compact 2100 model, which mounted a 23–26 horsepower engine, and the subcompact 1100 model, which had an engine rated for 20–26 horsepower. The new Mahindra compacts are built on two distinct chassis sizes and come with cab and open station options. Included with the 2126 compact cab are features like air conditioning with rear defrost.
• In August 2023, Seven revolutionary lightweight 4WD tractors were introduced by Mahindra OJA. The OJA, a line of Mahindra's Future Ready Global Light Weight 4WD Tractors created in association with Mitsubishi Mahindra Agriculture Machinery, Japan, represents a paradigm shift in tractor design and engineering.
• In July 2023, The high-performing XERION 12 Series tractors from CLAAS KGaA mbH were unveiled. Equipped with the ultra-efficient low-engine speed drive concept 2.0 are the two new tractor models.
• In February 2023, Massey Ferguson tractors introduced the DYNATRACK Series, an innovative line of tractors that combines powerful power with dynamic performance, smart technology, unparalleled usefulness, and versatility. The innovative Massey Ferguson DYNATRACK Series of tractors combines dynamic performance, cutting-edge technology, unparalleled utility, and versatility into a single, potent machine. The Sabse Bada Allrounder, the DYNATRACK, features the world's first extendable wheelbase and the best technology available for commercial, agricultural, and haulage applications.

Agricultural Tractor Market Scope:

Segmentation:

• By Engine Power
  • Less than 40 HP
  • 41 to 100 HP
  • More than 100 HP
• By Type
  • Utility Tractors
  • Row Crop Tractors
  • Orchard Type
  • Industrial Tractors
  • Other Tractors
• By Vehicle Type
  • Gasoline and Diesel
  • Electric
• By Mode of Operation
  • Manual Tractor
  • Autonomous
• By Geography
  • North America
    • United States
    • Canada
    • Mexico
  • South America
    • Brazil
    • Argentina
    • Others
  • Europe
    • Germany
    • Spain
    • United Kingdom
    • France
    • Others
  • Middle East and Africa
    • Saudi Arabia
    • South Africa
    • Others
  • Asia Pacific
    • China
    • Japan
    • Australia
    • India
    • Others