Asia-Pacific Agricultural Tractor Market - Growth, Trends and Forecast (2020 - 2025)

The Asia-Pacific Agricultural Tractor Market report analyses the market size, trends, drivers and restraints, industry attractiveness, competitive intelligence, and forecast to 2025. The market is segmented by Horse Power (Below 25 HP, 25 HP to 100 HP, & Above 100 HP) and Type (Orchard Tractors, Row Crop Tractors, & Other Types). The report also includes a geographical demonstration with analyses of the above for China, India, Japan, Australia, and Rest of Asia-Pacific. The market is analyzed from both quantitative and qualitative standpoints.

Market Snapshot

Study Period:

2016-2025

Base Year:

2019

CAGR:

3.5 %

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Market Overview

The Asia-Pacific Agricultural Tractor Market is estimated to grow at a CAGR of less than 3.5%, during the forecast period (2020-2025). An increased preference towards farm mechanization in the developing countries to keep pace with the need for increased agricultural production and food security, and government initiatives launching adequate credit facilities, are driving the overall agricultural tractor machinery market in the region. As a result, tractor sales in India rose significantly from 492,819 units in 2016 to 711,478 units in 2018. According to the Department of Agricultural Extension (DAE), Bangladesh, around 95% of the land is tilled through pedestrian and wheeled tractors while the demand for higher rage HP tractors in the country has increased primarily due to subsidized sales of the machinery by the government. These developments are further expected to enhance the adoption rate of tractors on crop fields across the region. China was the largest market for agricultural tractors in Asia in 2019. Since the implementation of the “Agricultural Mechanization Promotion Law” in 2004, the country has significantly emphasized on the promotion and role of agricultural mechanization in agriculture for rural economic development. Furthermore, China introduced ‘Made in China 2025’ scheme which aims at focusing on producing 90% of its own agricultural equipment with high-end machines, like agricultural tractors, holding almost one-third share of their segments by 2020.

Scope of the report

For the purpose of the study, tractors used for agricultural utility purposes have been considered under the scope of the report. On the quantitative front, the data will be provided based on the volume of units sold. The corporations in the agricultural tractor industry operate in B2B and B2C format. However, to eliminate any ‘double-count’ error in market estimations, bulk buyers procuring the agricultural machinery for retail sale are not considered in this market. Market size estimations for the forecast period were in real terms. The review period considered for the study is 2016-2019 and the forecast period is 2020-2025. 

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Key Market Trends

Increased Farm Mechanization in Developing Countries

Emerging economies, such as China and India, have been at the forefront in the number of tractors being sold across the Asia-Pacific region. China has significantly accelerated the adoption of tractors in recent years and its level of overall development of agricultural machinery is one of the important carriers for modern agriculture and a tool for improving agricultural productivity and liberating agricultural labor shortage. China introduced ‘Made in China 2025’ scheme which aims at focusing on producing 90% of its own agricultural equipment with high-end machines, like agricultural tractors, holding almost one-third share of their segments by 2020. This scenario is expected to boost the adoption rate of indigenously produced tractors in the country. In order to increase the level of farm mechanization, the Indian government is promoting ‘Balanced Farm Mechanization’ by providing subsidy on various equipment and by supporting bulk buying through front-end agencies, which is expected to strengthen the tractor market during the forecast period.​ Bangladesh has witnessed a shift towards automation on its farms, especially in the adoption of tractors. According to the Department of Agricultural Extension (DAE), Bangladesh, around 95% of the land is tilled through pedestrian and wheeled tractors. These developments are further e expected to augment the sales of tractors in the Asia-Pacific region, during the forecast period.

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India - The Largest Tractor Market in Asia-Pacific

According to a study by the Indian Council of Food and Agriculture Research, the farm mechanization level in India was recorded at 40%-45% in 2017. There have been several developments in the realm of government initiatives supporting farm-level disposable income and machinery purchases, including tractors. For instance, the state government of Haryana has resumed Sub-Mission on Agricultural Mechanisation (SMAM), which was launched during the 2019-20 budget and would provide a total subsidy of 34.44 crore Rupees for the purchase of 1,588 implements, including tractors. As a result, tractor sales in India expanded drastically from 492,819 units in 2016 to 711,478 units in 2018. According to the Economic Survey by the Government of India, farm mechanization and crop productivity have direct relation, as the use of agriculture machinery, such as tractors, will increase crop productivity by 30% and reduce the cost of cultivation by 20%. Moreover, leading tractor manufacturers are eyeing the capitalization of the burgeoning demand by introducing innovative tractors specific to regional needs. For instance, in 2019, Mahindra & Mahindra, a leading tractor manufacturer launched ARJUN NOVO 605 DI-I, a 50 HP technologically-advanced tractor that can handle 40 applications, including puddling, harvesting, reaping, and haulage, among others.  

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Competitive Landscape

The market share analysis revealed a consolidated market for agricultural tractors in the Asia-Pacific, as the leading tractor manufacturers occupy a significant share of the overall market. Some of the major players operating in the tractor segment in the region are Mahindra & Mahindra Ltd, AGCO Corporation, Deere & Company, CNH Industrial NV, CLAAS KGaA mbH, Tractors and Farm Equipment Ltd. (TAFE), Escorts Limited, and Kubota Corporation. These players are increasingly adopting key strategies, such as partnerships, and mergers and acquisitions, and product launches, in order to broaden their customer outreach in the region. For instance, in December 2018, Escorts Ltd partnered with Kubota Corporation, a Japanese tractor and heavy equipment manufacturer, to make co-branded tractors in India. This partnership helped in technology collaboration and joint manufacturing of high-end and value-oriented utility tractor range. In March 2018, Swaraj Tractors, a part of the Mahindra Group, launched a new tractor series, ranging from 60 HP to 75 HP tractors.

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Table Of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions & Market Definition

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS

    1. 4.1 Market Overview

    2. 4.2 Market Drivers

    3. 4.3 Market Restraints

    4. 4.4 Industry Attractiveness - Porter's Five Forces Analysis

      1. 4.4.1 Bargaining Power of Suppliers

      2. 4.4.2 Bargaining Power of Buyers

      3. 4.4.3 Threat of New Entrants

      4. 4.4.4 Threat of Siubstitutes

      5. 4.4.5 Intensity of Competitive Rivalry

  5. 5. MARKET SEGMENTATION

    1. 5.1 Horse Power

      1. 5.1.1 Below 25 HP

      2. 5.1.2 25 HP to 100 HP

      3. 5.1.3 Above 100 HP

    2. 5.2 Type

      1. 5.2.1 Orchard Tractors

      2. 5.2.2 Row Crop Tractors

      3. 5.2.3 Other Types

    3. 5.3 Geography

      1. 5.3.1 China

      2. 5.3.2 India

      3. 5.3.3 Japan

      4. 5.3.4 Australia

      5. 5.3.5 Rest of Asia-Pacific

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Most Adopted Strategies

    2. 6.2 Market Share Analysis

    3. 6.3 Company Profiles

      1. 6.3.1 AGCO Corporation

      2. 6.3.2 Mahindra & Mahindra Ltd

      3. 6.3.3 CNH Industrial NV

      4. 6.3.4 Deere & Company

      5. 6.3.5 CLAAS KGaA mbH

      6. 6.3.6 Escorts Limited

      7. 6.3.7 KUBOTA Corporation

      8. 6.3.8 Tractors and Farm Equipment Ltd. (TAFE)

      9. 6.3.9 Sonalika International Tractors Ltd.

      10. 6.3.10 Weifang Huaxia Tractor Manufacturing Co., Ltd.

  7. *List Not Exhaustive
  8. 7. MARKET OPPORTUNITIES & FUTURE TRENDS

  9. 8. IMPACT OF COVID-19

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