Tractor Rental Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Market Overview

The Tractor Rental Market was valued at USD 44.78 billion in 2021, and it is projected to reach USD 64.28 billion by 2027, registering a CAGR of 6.21% during the forecast period (2022-2027).

COVID-19 pandemic has shut down the production of various products in farm equipment, mainly owing to the prolonged lockdown in major global countries. This has hampered the growth of the farm equipment rentals market significantly in the last few months and was continued during 2020 and 2021. As part of its contribution to COVID-19 relief measures, Tractors and Farm Equipment Ltd (TAFE) has offered 16,500 tractors under a free rental scheme for farmers in Tamil Nadu. The scheme is intended to benefit approximately 50,000 farmers and will cover 1.20 lakh acres of agricultural land.

Over the long term, the increasing demand for mechanization and the rising number of low and medium-scale farmers are the primary factors that are creating a huge demand for tractor rental in underdeveloped countries such as Ghana and other African countries, majorly in the south of the Sahara, tractor rental firm allows tractor owners to fully utilize their machines, and additionally providing services to farmers, who cannot afford their tractors.

However, fluctuating fuel prices and a shortage of workers in rental companies, such as drivers, can stymie the growth of farm equipment rental services.

Asia-Pacific is expected to dominate the tractor rental market owing to rising crop production, increased adoption of advanced technology, and rising demand for tractors and various farming equipment such as harvesters, spraying, and threshing equipment for rental purposes. Farmers in the Asia Pacific region are increasing their production of rice and other crops such as palm oil and cotton. Furthermore, a shift in the agricultural sector across Asia Pacific countries from labor-intensive farming techniques to advanced technological equipment has resulted in increased demand for tractors and various farming equipment such as harvesters and spraying and threshing equipment for rental. Increased crop production has also resulted from investments in various agricultural machinery, particularly in developing countries such as India, China, Vietnam, and Thailand.

Scope of the Report

Tractors are earthmoving machines used for a variety of tasks in the agriculture and construction industries, among others. Tractors are also used in applications such as construction material loading and unloading, as well as plowing and farming.

The tractor rental market is segmented by tractor type, power source type, power type, and Geography.

The Tractor Rental Market is segmented by tractor type into utility tractors, row crop tractors, industrial tractors, and earth moving tractors. By power source type, the market is segmented into IC Engine, and Electric. By power, the market is segmented into less than 100 hp, 100-200 hp, and more than 200 hp. By Geography, the market is segmented into North America, Europe, Asia-Pacific, and the Rest of the World. The report covers the market size and forecast in value (USD Billion) for all the above segments.

The tractor rental market report covers the increasing demand for tractor rental solutions, new players entering the market, the impact of mobile-based applications on the market, and initiatives taken by market players to gain a competitive advantage. 

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Key Market Trends

Increase in Online Rental Services is driving the Market

Purchasing any farming machinery always requires a huge amount of money and in addition to that, it needs maintenance but in the case of renting there is no hassle of any maintenance

The tractor rental market has created the best solution for the middle-class farmers’ who can’t afford and maintain the tractor as now they can rent a vast variety of tractors on basis of location, type, feature, and duration. Farmease one of the leading rental service providers in the United States connects the farmers to share their spare farm machinery with needy farmers who can’t afford the machinery. Tractor owners can earn from their tractor which adds a second income source to them, and on the renter's front, they get access to the tractor on demand by that they get the latest technology at affordable prices according to the need. Major rental service providers are tapping into the unexplored market as the developing countries have huge potential for tractor rental as compared to matured markets such as North America and Europe.

For instance, In May 2021, as part of its contribution to COVID-19 relief measures, Tractors and Farm Equipment Ltd (TAFE) offered 16,500 tractors under a free rental scheme for farmers in Tamil Nadu who own agricultural land of two acres or less. The scheme is intended to benefit approximately 50,000 farmers and will cover approximately 1.20 lakh acres of agricultural land. According to a company statement, TAFE would offer its 16,500 Massey Ferguson and Eicher tractors to small farmers with two acres or less.

In April 2021, Tractor Supply's mobile app has surpassed 1 million downloads in less than a year. According to Lawton, the app has become a "material portion" of Tractor Supply's digital sales, with customers able to schedule their buy online, and pick up in-store orders there. BOPIS accounts for approximately 75% of the retailer's digital sales, with 75% of those orders being for curbside pickup.

In 2018, Aeris, the United States-based technology company is coming together with Hello Tractor, an agriculture technology company that has previously worked with farmers in Nigeria and Kenya, to launch a tractor rental service in India.

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