The global farm equipment market is projected to grow from USD 115.58 billion in 2025 to USD 152.79 billion by 2032, at a CAGR of 4.1%.
The farm equipment market has declined from 2022 to 2024 and is expected to continue its trend till 2026–2027. According to a recent report published by the United States Department of Agriculture (USDA), the farm equipment market is primarily driven by a projected ~25% drop in net farm income for 2024, falling from USD 155 billion to USD 116 billion, which has made farmers hesitant to invest in new machinery. Additionally, high operational costs and increasing commodity prices have pressured farmer’s budgets, leading to a 15-20% decrease in monthly US tractor sales. Moreover, the demand for balers, sprayers, combines, and the other equipment market also suffers as many farmers postpone purchases due to these financial constraints. Similar trends and challenges have been followed in Europe and Asia due to increasing commodity prices, high operational costs, and reduced farm incomes. For instance, the European tractor market saw an ~11.4% decline in sales in early 2024, while India’s tractor sales also faced a downturn of ~8.7%. However, this trend might continue for 2-3 years, and in the future, the global agricultural equipment market is projected to grow significantly.
31–70 HP segment is estimated to be the largest market during the forecast period
In the 31–70 HP segment, it is projected to hold the largest market during the forecast period, accounting more than 50% of the market share for the year 2025. This trend is driven by the increasing adoption of farm mechanization, particularly in emerging markets where small to medium-sized farms dominate in Asia Oceania mainly due to the Indian market. India had a market share more than 80% for 31–70 HP in 2024 and expected to continue with the leading positions. Further, the updated TREM Stage IV regulation was introduced in January 2023, due to which the price increased by 1 lakh rupees (approx. USD 1,340) for tractor with >50 HP. This price hike is mainly due to mandatory installation of Common Rail Direct Fuel Injection (CRDI) in the tractor engines. To which there was a shift in consumer preference for 45-50 HP tractors as these tractors were provided with 4WD option with the same power capacity as compared to >50-60 HP tractors and with lower price.
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The 4WD is estimated to be the fastest-growing segment in drive type over the forecast period.
4WD is dominated by European region with a market share more than 80% in the year 2024. The Europe has higher farmlands which increase the need of high-performance tractors as it has ability to cover extensive farmland area very efficiently with a better traction and stability. Countries like France, UK, and Germany has the highest demand 4WD tractors due to labor shortage which has increased the demand for mechanized farming equipment, including tractors to increase the efficiency and productivity. The major key players in Europe who offers 4WD tractors and other equipment are Deere & Company with 9R, 6R, 7R Series; CNH Industrial offers 4WD under the brands of Case IH Magnum and New Holland T9, AGCO Corporation featuring Massey Ferguson with 8700 Series for 4WD and Fendt with 1000 Vario series. The OEMs are actively investing in R&D for developing new products and precision agriculture features in tractors.
“Asia Oceania is estimated to be the dominant regional market.”
Asia Oceania dominates farm equipment with a market share of >50% in 2025 even though the promising markets like China, India and Japan had noticed a deep in past 2 years. According to a report published by The International Monetary Fund in August 2024, the Asia Oceania market for farm equipment declined in 2023 – 2024 primarily due to various factors such as falling farm incomes globally, leading to reduced purchasing power for farmers, increased labor costs due to rural migration, high initial cost of modern machinery, and a trend towards delaying large equipment purchases due to economic uncertainty, causing farmers to prioritize maintaining existing equipment over buying new ones. The Indian market held more than 60% in 2024 within Asia Oceania region which was dominated by the major key players like Mahindra and Mahindra, Sonlaika, TAFE, and Escort Kubota Corporation. The Indian market has the market share more than 80% for 31-70 HP tractors due to small and medium farm field. The OEMs present in this country are actively investing in India for setting a new manufacturing plant for tractor and engines to lower the manufacturing cost.
Key Market Players:
The farm equipment market is dominated by established players such as Deere & Company (US), AGCO Corporation (US), CNH Industrial (Netherlands), Kubota Corporation (Japan), CLAAS KGAA (Germany), Mahindra & Mahindra (India), ISEKI & Co., Ltd. (Japan), Escorts Kubota Limited (Idia), SDF Group (Germany), and Yanmar Holdings Co., Ltd (Japan). These companies adopted strategies such as product developments, deals, and others to gain traction in the market.
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