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Agricultural Tractors Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

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  • 133 Pages
  • August 2022
  • Region: Global
  • Mordor Intelligence
  • ID: 4515760
The global agricultural tractor market is projected to register a CAGR of 5.2% over the forecast period 2022-2027.

During the COVID-19 pandemic, the sector saw a sharp dip in business, and the most affected business was the dealership network due to the disruption of supply chains. Additionally, manufacturing units were not 100% active. Due to travel restrictions, production of goods was delayed as supply was interrupted, resulting in a sharp decrease in tractor sales during the pandemic.​ As the situation returns to normal across countries, the impact has been reducing on the agricultural tractor market.

Row-crop tractors are estimated to be the largest agricultural tractor segment in the global market. Several major market players are spending on research and development in order to produce cutting-edge equipment and retain a strong market position. For instance, in 2020, Deere & Company launched a new 8 Family Tractor line-up that included 8R wheel tractors, 8RT two-track tractors, and the industry’s first fixed-frame four-track tractors. These new tractors come equipped with the latest precision agriculture technology and allow customers to choose the machine configuration, options, and horsepower to best fit their operation.

Asia-Pacific is considered one of the fastest-growing markets because the cost of labor has been increasing at very high rates, and the cost of farm labor is directly proportional to the cost of production. Thus, the increasing labor wages and the lack of farm labor have led to the increasing rates of mechanization in the region. This is driving the growth of the tractor market in the region. In addition, numerous businesses have been releasing new agricultural tractors, allowing them to dominate the market studied with speedier product launches and advancements.

Key Market Trends

Increasing Farm Mechanization in Developing Markets

Precision farming and the increasing adoption of farm technology to boost production are driving up demand for tractors. The increasing number of farm training programs promoting the use of agricultural machinery on a wide scale is also driving the tractor industry. With an engine volume of not more than 1,500 CC, these tractors occupy less space and can be used with greater flexibility. Ease of customization makes them more amenable to experimentation, and consequentially, manufacturers are willing to try new components and technologies in this segment before moving on to high-powered ones. Low horsepower tractors work well in soft soil conditions, such as river basins. The lesser than 40 HP tractors are mainly used for horticulture. In developing countries, the demand for lower HP tractors is high due to the low disposable income of farmers and high labor costs. Farmers prefer small and customized tractors for agricultural purposes due to small farmland sizes. Moreover, lesser fuel consumption by small tractors helps empower small and marginal farmers. Like India, governments in developing countries promote farm mechanization by subsidizing equipment purchases and supporting bulk buying through front-end agencies. Due to the increasing demand from developing countries, the major players in the market are innovating new products. For instance, in March 2018, KUBOTA UK launched the L1361 compact utility tractor, which is equipped with a 36.6-HP, three-cylinder KUBOTA D1803-M-E2 engine, along with a manual or three-range hydrostatic transmission and a 38-liter capacity tank. These factors are likely to drive the market during the forecast period.​

Asia-Pacific Dominating the Market

In the Asia-Pacific, China, Japan, and India lead in terms of the number of tractors sold. Around 60% of China’s farm activities are mechanized. According to data from the National Bureau of Statistics of China, China produced 617,700 tractors in 2019. Large and medium-sized tractors are gradually being replaced by small tractors. As of the end of 2019, China boasted 22.24 million agricultural tractors, including 4.44 million large- and medium-sized tractors. The government included agricultural machinery in its ‘Made in China 2025’ campaign. The program is expected to help the country produce most of its farm equipment domestically, which is expected to increase the sales of tractors in China. The agriculture sector in India has witnessed a substantial decline in the use of animal and human power in the agriculture sector. Fossil fuel-operated vehicles, such as tractors and diesel engines, are being used instead, which has resulted in a shift from the traditional agriculture process to a more mechanized process. In order to increase the mechanization level, the Indian government is promoting ‘Balanced Farm Mechanization’ by providing subsidies on various equipment and supporting bulk buying through front-end agencies, which is expected to strengthen the tractors market in India. Thus, the implementation of programs by governments in the region along with the increasing tractor usage across the region are expected to drive the market during the forecast period.

Competitive Landscape

In 2021, the global agricultural tractor market was consolidated, with major players occupying a significant market share. Deere and Company, Kubota Corporation, CNH Industrial NV, AGCO Corporation, and CLAAS KGaA mbH are the major players in the market. New product launches, partnerships, and acquisitions are the major strategies being adopted by the leading companies in the global market.

Additional Benefits:

  • The market estimate (ME) sheet in Excel format
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Table of Contents

1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
4.1 Market Overview
4.2 Market Drivers
4.3 Market Restraints
4.4 Porter's Five Forces Analysis
4.4.1 Bargaining Power of Suppliers
4.4.2 Bargaining Power of Buyers
4.4.3 Threat of New Entrants
4.4.4 Threat from Substitute Products
4.4.5 Intensity of Competitive Rivalry
5.1 Horse Power
5.1.1 Lesser than 40 HP
5.1.2 40 HP to 99 HP
5.1.3 100 HP to 150 HP
5.1.4 151 HP to 200 HP
5.1.5 201 HP to 270 HP
5.1.6 271 HP to 350 HP
5.1.7 Greater than 350 HP
5.2 Type
5.2.1 Orchard Tractors
5.2.2 Row-crop Tractors
5.2.3 Other Types
5.3 Geography
5.3.1 North America United States Canada Mexico Rest of North America
5.3.2 Europe Germany United Kingdom France Spain Italy Russia Poland Rest of Europe
5.3.3 Asia-Pacific China Japan India Australia Rest of Asia-Pacific
5.3.4 South America Brazil Argentina Rest of South America
5.3.5 Africa South Africa Rest of Africa
6.1 Most Adopted Strategies
6.2 Market Share Analysis
6.3 Company Profiles
6.3.1 Claas KGaA mbH
6.3.2 Deere & Company
6.3.3 Mahindra & Mahindra Ltd
6.3.4 CNH Industrial NV
6.3.5 Kubota Corporation
6.3.6 AGCO Corporation (Massey Ferguson Limited)
6.3.7 Tractors and Farm Equipment Ltd
6.3.8 Iseki & Co. Ltd
6.3.9 Yanmar Holdings Co. Ltd

Companies Mentioned

A selection of companies mentioned in this report includes:

  • Claas KGaA mbH
  • Deere & Company
  • Mahindra & Mahindra Ltd
  • CNH Industrial NV
  • Kubota Corporation
  • AGCO Corporation (Massey Ferguson Limited)
  • Tractors and Farm Equipment Ltd
  • Iseki & Co. Ltd
  • Yanmar Holdings Co. Ltd