The United States agricultural machinery market is projected to witness a CAGR of 4.7% during the forecast period (2020-2025).
- Increasing farm labour charges, labour scarcity, and average farm size are the two major factors that are driving the agricultural machinery market in the country. According to USDA, average farm wages in the US has increased by 10.5% in four years (2014-2018). The average farm wage in the country was USD 12 in 2014, which has reached to USD 13.2 in 2018.
- According to Farm Bearue Survey in 2019, California farmers have adopted various farm mechanisation technologies to overcome the labour challenge. According to the survey, more than 40% of the farmers have faced labour crunch in the past five years leading to farm mechanization in the state.
Key Market Trends
Increasing Average Farm Size
The increasing farm size in the country is leading to a drop in the number of farms in the United States. According to USDA, there were 2.06 million farms in 2016, which has decreased to 2.05 million farms in 2017. Almost 50% of the farms in the country are family-operated farms with annual sales of USD 10,000 and their average farm size is around 309 acres in 2017. The major reason for the consolidation of the farm is profitability. Larger the farm size higher the profitability. According to USDA in 2017, 74% of the farm with an average gross farm cash income of USD 5 million is running with 10% of gross profit margin, with a farm size of around 1100-1200 acres approximately.
Cultivators & tillers holds largest share in ploughing and cultivating machinery segment
The cultivators and tillers are projected to witness a CAGR of 3.7% during the forecast period (2020-2025). There has been a rising concept of incorporating autonomous robotics into agriculture, to reduce the reliance on manual labor, while increasing efficiency, product yield, and quality. In response to this, an automated cultivator has been developed by the US Davis Smart Farm, California, as a part of its research initiative in March 2018. These new developments can enhance the growth of cultivators in the market. Owing to the factors that no-till farm practice can lead to the rise of pests than till based farming practices is boosting the market for cultivators and tillers in the country.
Kubota Corporation, AGCO Corporation, CNH Industrial, Deere & Company are the major players in the market, together accounting for 47.7% of the market share in 2019. Apart from the major players, there are a lot of local companies cornering smaller shares in the North American plowing and cultivating the machinery market. Mergers & acquisitions, partnerships, expansion and product launch are the business strategies adopted by the major players in the market.
Reasons to Purchase this report:
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support