South Africa Agricultural Machinery Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The South African Agricultural Machinery Market is segmented by Tractors into Engine Power (Less than 40HP, 40HP-99HP, Greater than 100HP), Type (Compact Utility Tractors, Utility Tractors, Row Crop Tractor), Ploughing and Cultivating Machinery (Ploughs, Harrows, Cultivators and Tillers, and Other Ploughing and Cultivating Machinery), Harvesting Machinery (Combine, Forage and Other Harvesting Machinery), Haying and Forage Machinery (Mowers and Conditioners, Balers, and Other Haying and Forage Machinery), and Irrigation Machinery (Sprinkler, Drip, and Other Irrigation Machinery). The report offers market size and forecasts for the South African Agricultural Machinery Market in value of USD million for all the above segments.

Market Snapshot

South Africa Agricultural Machinery Market  bar graph
Study Period: 2017-2027
Base Year: 2021
CAGR: 5.6 %

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Market Overview

The South African agricultural machinery market is projected to register a CAGR of 5.6% over the forecast period (2022-2027).

During the COVID-19 pandemic, the sector saw a sharp dip in the agricultural machinery business, and the most affected segment was the dealership network due to the disruption supply chain and since manufacturing units were not 100% active. Due to travel restrictions, production of goods was delayed, as supply was being interrupted, resulting in a sharp decrease in sales of agricultural machinery business during 2019-2020.

Agriculture has been one of the most important sectors of the South African economy. Gulf countries and the Arab world remain reliant on South Africa for grains, fruits, and vegetables. It is one of the few countries in Africa to be economically developed is a fact that drives agricultural machinery adoption. The fruits of South Africa’s good harvest in 2020 and another good season in 2021 are benefiting the agriculture machinery industry. The industry has continued to record good sales as farmer finances improved. The figures released by the South African Agricultural Machinery Association in April show that tractor and harvester sales were up by 30% y/y and 4% y/y in March 2021, with 601 and 27 units sold, respectively. Increasing Daily wages and seasonal rural labor shortages due to urban migration are some of the driving factors for the adoption of mechanization in agriculture, pushing for more utilization of agriculture tractors.

Scope of the Report

Agricultural machinery are mechanical devices that are used in farming and other agriculture practices. These include many types of such equipment, including hand tools and power tools to tractors and the various kinds of farm implements that are used to operate farming activities.

The South African Agricultural Machinery Market is segmented by Tractors into Engine Power (Less than 40HP, 40HP-99HP, Greater than 100HP), Type (Compact Utility Tractors, Utility Tractors, Row Crop Tractor), Ploughing and Cultivating Machinery (Ploughs, Harrows, Cultivators and Tillers, and Other Ploughing and Cultivating Machinery), Harvesting Machinery (Combine, Forage and Other Harvesting Machinery), Haying and Forage Machinery (Mowers and Conditioners, Balers, and Other Haying and Forage Machinery), and Irrigation Machinery (Sprinkler, Drip, and Other Irrigation Machinery). For each segment, the market sizing and forecast have been done on the basis of value in USD million.

Type
Tractors
Engine Power
Less than 40 HP
40 HP to 99 HP
Greater than 100 HP
Type
Compact Utility Tractors
Utility Tractors
Row Crop Tractors
Ploughing and Cultivating Machinery
Ploughs
Harrows
Cultivators and Tillers
Other Ploughing and Cultivating Machinery
Planting Machinery
Seed Drills
Planters
Spreaders
Other Planting Machinery
Harvesting Machinery
Combine Harvesters- Threshers
Forage Harvesters
Other Harvesting Machinery
Haying and Forage Machinery
Mower- Conditioners
Balers
Other Haying and Forage Machinery
Irrigation Machinery
Sprinkler Irrigation
Drip Irrigation
Other Irrigation Machinery

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Key Market Trends

Farm Labor Shortage Drives the Market

The shortage of farm labor became a serious problem in South Africa, causing a rise in labor wages. This accelerated the sales of farm machinery and aided in market growth. According to the World Bank survey, South African employment in agriculture reduced from 5.57 % in 2016 to 5.28% in 2019. In search of work, inadequate services and limited access to financial capital lead to migration from rural areas to urban centers. According to the World Bank, Sub-Saharan Africa experienced an annual urban population growth rate of 2.1% in 2019. This is leading to a labor shortage in the agriculture sector.

South Africa Agriculture Machinery Market: Employment in Agriculture (% of Total Employment), South Africa, 2015-2018

Rise in Tractor Sales

Tractor is one of the most important segments of the South African agricultural machinery market. Tractor, being basic agriculture machinery, occupies the major part of agriculture machinery in terms of units sold. A continuous increase in tractors sales has been noticed over the last few years. For instance, in 2020, according to the South African Agricultural Machinery Association (SAAMA), South Africa’s tractor sales accumulated to 5 738 units, up by 9% from 2019. Similarly, tractor sales were up by 30% y/y in March 2021. The average number of tractors per thousand hectares of land in South Africa increased to 3.8 in 2018, which was 3.2 in 2017. The tractor sales were fuelled by increasing government subsidies for farm mechanization, accommodative financing, growth in the agricultural industry, and increased awareness of farm machine mechanization.

South Africa Agriculture Market

Competitive Landscape

The market is consolidated owing to the presence of a few prominent players, accounting for more than half of the market. The key players in the market include Deere and Company, AGCO Corporation, CNH Industrial NV, Mahindra & Mahindra South Africa Pty Ltd, and Kubota Corporation. The main strategy adopted by the key players has been to invest in R&D to encourage innovation and maintain a strong market base. Advanced technologies like Artificial Intelligence, Robotics, Google Earth, and a growing number of government initiatives have driven the demand for agricultural machinery in South Africa.

Recent Developments

In November 2021, Mahindra launched a new tractor and a farm equipment range in South Africa. The range includes products from Sampo Rosenlew, Finland, Mitsubishi Mahindra Agri Machinery, Japan, and Hisarlar and Erkunt equipment from Turkey.

In May 2017, AGCO introduced four tractors from the high-tech brand Fendt (Fendt 200 Vario, Fendt 700 Vario, Fendt 900 Vario, and Fendt 1000 Vario) into the South African market.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions and 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 Porter's Five Forces Analysis

      1. 4.4.1 Threat of New Entrants

      2. 4.4.2 Bargaining Power of Buyers

      3. 4.4.3 Bargaining Power of Suppliers

      4. 4.4.4 Threat of Substitute Products

      5. 4.4.5 Intensity of Competitive Rivalry

  5. 5. MARKET SEGMENTATION

    1. 5.1 Type

      1. 5.1.1 Tractors

        1. 5.1.1.1 Engine Power

          1. 5.1.1.1.1 Less than 40 HP

          2. 5.1.1.1.2 40 HP to 99 HP

          3. 5.1.1.1.3 Greater than 100 HP

        2. 5.1.1.2 Type

          1. 5.1.1.2.1 Compact Utility Tractors

          2. 5.1.1.2.2 Utility Tractors

          3. 5.1.1.2.3 Row Crop Tractors

      2. 5.1.2 Ploughing and Cultivating Machinery

        1. 5.1.2.1 Ploughs

        2. 5.1.2.2 Harrows

        3. 5.1.2.3 Cultivators and Tillers

        4. 5.1.2.4 Other Ploughing and Cultivating Machinery

      3. 5.1.3 Planting Machinery

        1. 5.1.3.1 Seed Drills

        2. 5.1.3.2 Planters

        3. 5.1.3.3 Spreaders

        4. 5.1.3.4 Other Planting Machinery

      4. 5.1.4 Harvesting Machinery

        1. 5.1.4.1 Combine Harvesters- Threshers

        2. 5.1.4.2 Forage Harvesters

        3. 5.1.4.3 Other Harvesting Machinery

      5. 5.1.5 Haying and Forage Machinery

        1. 5.1.5.1 Mower- Conditioners

        2. 5.1.5.2 Balers

        3. 5.1.5.3 Other Haying and Forage Machinery

      6. 5.1.6 Irrigation Machinery

        1. 5.1.6.1 Sprinkler Irrigation

        2. 5.1.6.2 Drip Irrigation

        3. 5.1.6.3 Other Irrigation Machinery

  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 John Deere (Pty) Ltd

      2. 6.3.2 CNH Industrial NV

      3. 6.3.3 AGCO Corporation

      4. 6.3.4 Mahindra & Mahindra South Africa Pty Ltd

      5. 6.3.5 Kubota Corporation

      6. 6.3.6 JC Bamford Excavators Limited

      7. 6.3.7 Lindsay Corporation

  7. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

  8. 8. AN ASSESSMENT OF THE COVID-19 IMPACT ON THE MARKET

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Frequently Asked Questions

The South Africa Agricultural Machinery Market market is studied from 2017 - 2027.

The South Africa Agricultural Machinery Market is growing at a CAGR of 5.6% over the next 5 years.

John Deere, Mahindra & Mahindra South Africa Pty Ltd, Kubota Corporation, Agco Corporation, CNH Industial (New Holland Agriculture) are the major companies operating in South Africa Agricultural Machinery Market.

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