Agricultural Equipment Market is estimated to be valued at USD 145.24 Bn in 2025 and is expected to reach USD 200.31 Bn in 2032, exhibiting a compound annual growth rate (CAGR) of 4.7% from 2025 to 2032.
Agricultural equipment or equipment is the machinery used in the agriculture and farming applications. Different types of tools and equipment are used in agricultural applications such as hand tools, power tools, tractors, and more. Moreover, equipment varies according to the type of farming, i.e., organic farming and inorganic farming. Tractors, seed drill, thresher, combine harvesters, rotavators, power weeder, mowers, rakes, and balers are some of the commonly used agricultural equipment. Technological revolution and constant research and development have introduced high-functioning equipment that performs extensive amount of work efficiently.
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Systemic farm economy financial crisis |
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Labor shortage and automation technology convergence |
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Automation is transforming the agricultural equipment industry, reshaping how farmers manage their operations with greater precision, efficiency, and sustainability.
Modern farms are increasingly adopting autonomous tractors, robotic harvesters, and AI-powered planting systems to streamline labor-intensive tasks. These technologies integrate GPS guidance, real-time data analytics, and sensor-based controls to optimize field activities like tillage, seeding, and spraying. Automation also supports precision agriculture, enabling targeted resource use and reducing environmental impact.
Leading manufacturers are embedding smart features into their equipment, allowing farmers to monitor performance remotely, adjust settings dynamically, and make data-driven decisions. This shift not only improves productivity but also helps address challenges like labor shortages and climate variability. As automation becomes more accessible, it’s paving the way for a new era of intelligent, resilient farming.
For instance, in August 2025, Case IH launched new agricultural machinery and farmer-focused innovations at the Farm Progress Show, spotlighting automation and precision technology. Highlights include advanced tillage tools, smart planting systems, and digital solutions aimed at boosting productivity and sustainability. The launch reflects Case IH’s commitment to modernizing farming through cutting-edge equipment and data-driven tools.
In terms of product type, the tractors segment is expected to lead the market with 40% share in 2025, driven by their versatility and widespread adoption. They are essential for plowing, tilling, hauling, and powering other implements, making them indispensable across farm sizes. Technological advancements like GPS and automation enhance their appeal, especially in large-scale operations. Emerging economies such as India and Brazil see rising tractor demand due to labor shortages and government subsidies. Compared to other equipment like combine harvesters, rotavators, and seed drills, tractors command higher market value and broader usage. Their utility, innovation, and economic impact secure their position as the leading segment in agricultural machinery.
For instance, in October 2025, Gromax Agri Equipment, a Mahindra Group subsidiary, launched eight new tractors across various horsepower categories in both 2WD and 4WD segments. This expansion aims to meet diverse farming needs and strengthen Gromax’s presence in India’s agricultural machinery market, offering enhanced performance, reliability, and value to farmers nationwide.
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Asia Pacific, holding an estimated share of 37.6% in 2025, is set to dominate the global agricultural equipment market. This is primarily due to rising food demand, labor shortages, and government subsidies promoting mechanization. Countries like India and China are investing in modern tools to boost productivity. Affordable, locally manufactured equipment and precision farming technologies are also driving adoption, making the region a hotspot for agricultural innovation.
For instance, in March 2025, Vietnam unveiled Asia’s largest agricultural machinery exhibition, showcasing cutting-edge farming technologies and equipment. The event highlights innovations in tractors, harvesters, irrigation systems, and smart farming solutions, drawing global attention to Vietnam’s growing role in agricultural modernization and international collaboration. It marks a major milestone for the region’s agri-tech industry.
North America shows the fastest growth in the agricultural equipment market due to rising demand for precision farming, labor shortages, and the adoption of advanced technologies like autonomous tractors and smart irrigation. Large-scale farms in the U.S. and Canada are investing in high-efficiency machinery to boost productivity and sustainability, driving strong market growth across the region.
For instance, in September 2025, AGCO Corporation finalized the sale of its interest in TAFE (Tractors and Farm Equipment Limited), marking a strategic shift in its global operations. The move aligns with AGCO’s focus on streamlining its portfolio and strengthening core business areas in agricultural machinery and technology. The transaction was officially completed on September 30, 2025.
In 2025, India’s agricultural equipment market is booming due to rising mechanization, government subsidies, and labor shortages. Smallholder farmers are adopting tractors, tillers, and smart tools to boost productivity and reduce manual effort. Local manufacturing and affordable pricing also drive demand, making India one of the fastest-growing markets for farm machinery and technology.
For instance, in September 2025, Escorts Kubota introduced the PRO588i-G harvester, designed to enhance harvesting efficiency and productivity for Indian farmers. Engineered for performance and durability, the new model supports multiple crops and challenging field conditions. This launch reinforces Escorts Kubota’s commitment to agricultural innovation and meeting the evolving needs of modern farming in India.
In 2025, the U.S. agricultural equipment market is thriving due to widespread adoption of precision farming, autonomous machinery, and smart irrigation systems. Labor shortages and the need for sustainable, high-efficiency farming drive demand. Large-scale commercial farms are investing in advanced technologies to boost productivity, reduce costs, and meet growing food and environmental challenges.
For instance, in October 2025, JCB unveiled the Loadall 546-70 and 555-70 telescopic handlers, designed to enhance material handling in agriculture. These new models offer increased lift capacity, improved efficiency, and robust performance for demanding farm operations. The launch reinforces JCB’s commitment to innovation and supporting modern farming needs with advanced machinery solutions.
| Report Coverage | Details | ||
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| Base Year: | 2024 | Market Size in 2025: | USD 145.24 Bn |
| Historical Data for: | 2020 To 2024 | Forecast Period: | 2025 To 2032 |
| Forecast Period 2025 to 2032 CAGR: | 4.7% | 2032 Value Projection: | USD 200.31 Bn |
| Geographies covered: |
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| Companies covered: |
AGCO Corporation, Bucher Industries AG, CLAAS KGaA mbH, CNH Industrial N.V., KUBOTA Corporation, ISEKI & CO., LTD., Tractors and Farm Equipment Limited, SDF Group, Deere & Company., EXEL Industries, Mahindra&Mahindra Ltd., YTO Group, Kioti Tractor, Massey Ferguson., Minsk Tractor Works. |
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The world population continues to grow, resulting in the increased demand for food and agricultural products. To meet the growing demand for food, farmers and farms are turning to mechanization and advanced equipment to increase productivity, reduce labor costs and increase overall efficiency. Innovative devices, such as precision farming equipment, autonomous machines, and sensor-based systems, enable farmers to optimize resource use, monitor yields, and increase yields. These technological advances are driving the adoption of agricultural equipment as farmers strive to remain competitive and maximize yields. For instance, in March 2023, Deere & Company, doing business as John Deere, a U.S.-based company that manufactures agricultural equipment, heavy equipment, forestry machinery, diesel engines, drivetrains used in heavy equipment, and lawn care equipment. John Deere Company announced the launch of its new See & Spray Ultimate autonomous sprayer. This sprayer is equipped with a variety of sensors and cameras that allow it to operate autonomously in the field.
In many countries, governments offer supporting policies to farmers to purchase agricultural equipment, in order to work more efficiently. The government offers subsidies, credit schemes, subsidized interest rates, in order to boost the market growth. Governments around the world are supporting and subsidizing the agricultural sector to modernize, boost productivity, and increase food security. These efforts often include financial incentives and tax incentives for farmers to invest in agricultural equipment. Rapid technological progress has revolutionized the agricultural sector. For instance, in 2023, the India government announced The PM Kisan Tractor Scheme 2023, a government effort that aims to provide financial support to farmers based in India, helping them purchase tractors. Eligible farmers receive a subsidy of up to 20% of the tractor's cost, or a maximum of US$ 609.52, whichever is less. The scheme is implemented by the state authorities. Subsidy provided by the government is directly transferred to the bank account of the applicant.
Market leaders are actively focusing on research and development activities to provide consumers with innovative and high-quality products. Some companies are introducing the next generation of autonomous tractors to take advantage of the growing market. In response to the growing market demand and technological advancements, market leaders in the agricultural equipment industry are placing significant emphasis on research and development activities. These companies are actively investing resources to develop innovative and high-quality products that meet the evolving needs of consumers. As part of their efforts, some companies are introducing the next generation of autonomous tractors, leveraging the advancements in automation and robotics. These autonomous tractors are designed to operate with minimal human intervention, utilizing advanced technologies such as GPS, sensors, and artificial intelligence. They offer increased efficiency, precision, and productivity in various farming operations, including planting, harvesting, and field maintenance. By leveraging autonomous capabilities, these tractors can navigate fields, optimize routes, and perform tasks with high accuracy, ultimately leading to improved yields and reduced operational costs for farmers.
Contract farming has emerged as a significant trend in various countries, in order to reduce migration from rural to urban areas, generate stable source of income, and get seasonal rotation of crops. In this type of farming, the farmers are contracted to plant the contractor’s crop on his land and then harvest and deliver the crop to the contractor at a pre-agreed price. According to Coherent Market Insights analysis, in Brazil, 75% of poultry production are under contract farming. Moreover, emerging economies such as Vietnam, India, Morocco, and more have developed policies for endorsing contract farming. In the U.S. and European countries, contract farming has witnessed significant growth.
Key players in the market are involved in developing smart tractors that are equipped with advanced technologies such as GPS antenna, different attachments such as thresher, hauler, and fertilizer distributors, and better hydraulic systems. Such equipment is expected to offer more efficient performance that its contemporaries. Smart tractors are equipped with different attachments such as threshers, tractors and spreaders. These attachments increase the equipment's versatility and functionality, allowing the farmer to perform multiple operations with his single machine. Installing such attachments streamlines farming operations, reduces the need for separate machines, and optimizes resource utilization.
The agricultural equipment market value is undergoing structural transformation driven by digitalization, automation, and changing farm economics. Precision technologies such as GPS guidance and autosteer have reached over 70% adoption among large farms, yet penetration among smallholders remains limited, creating a two-speed equipment ecosystem. Dealers now act as gateways for connected services and telemetry, shifting profit pools from machinery sales to recurring data and maintenance revenues.
Demand trends reveal sharp polarization: high-horsepower tractor sales in mature markets like the UK fell by nearly 38% in early 2025, reflecting weaker farm incomes and delayed replacement cycles. Conversely, India and other Asian economies continue to post record tractor sales supported by mechanization subsidies and rural credit expansion. Electric and autonomous tractors, while still niche, are gaining commercial credibility in horticulture and specialty crops, offering measurable operating cost reductions and improved labor efficiency.
The market’s next phase will be defined by platform modularity, dealer-led service integration, and regional duality, cost-efficient models for emerging markets and precision-enabled systems for developed regions. Success will favor OEMs that convert digital upgrades into service revenue while maintaining production efficiency. Structural winners will be those delivering real, measurable productivity and sustainability gains to farmers under rising cost pressure.
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About Author
Ramprasad Bhute is a Senior Research Consultant with over 6 years of experience in market research and business consulting. He manages consulting and market research projects centered on go-to-market strategy, opportunity analysis, competitive landscape, and market size estimation and forecasting. He also advises clients on identifying and targeting absolute opportunities to penetrate untapped markets.
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