Freedonia Market Research Analyzes the Global Agricultural Equipment Industry

World demand for agricultural equipment is forecast to rise 3.8 percent per year through 2012 to $112 billion.  Gains will be paced by the accelerating mechanization of the agricultural sectors in large markets such as China and India.  Farm sectors in these countries are still significantly unmechanized and inefficient in comparison to those found in more developed markets.  The rapid rise throughout the world in staple food crop prices and localized shortages in 2007 and early 2008 indicate a growing necessity for increasing farm productivity and efficiency in developing countries.  These and other trends, including market share and company profiles, are presented in World Agricultural Equipment, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm. 

Strongest growth in agricultural equipment demand will be registered in developing countries, with China and India holding by far the best prospects.  Other large developing nations with sizable agricultural sectors such as Brazil, Indonesia, Russia and Thailand will also post healthy gains as a result of increasing mechanization.  Besides benefitting from rising incomes, farmers in developing regions will continue to strive to increase productivity through further automation and replacement of older equipment and of draft animals used during various stages of the farming process. 

The US will experience gains that lag the world average due to decelerating growth in economic and agricultural sector output in the country.  Western Europe will post particularly anemic growth, coming off a strong 2007 when demand (in dollars) was bolstered by a strong Euro and several other less significant factors such as Germany’s biofuel boom-related forage harvester purchases. 

Throughout the industrialized world, demand will largely be replacement oriented in nature, as the farming sectors of most countries are not growing in terms of number of farms, acreage harvested and similar physical variables.  Demand will also be aided by the development and growing use of nascent higher value “precision agriculture” products that make extensive use of modern technologies such as Global Positioning Satellite (GPS) systems and wireless sensors.  Given the widespread diversity and often interrelation of applications, growth prospects for specific types of farm machinery -- tractors, combines, planting and fertilizing, plowing and cultivating, and haying machinery, etc. -- do not vary substantially when viewed at the global level.

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.