The Agricultural Machinery Industry plays a huge role in producing advanced farm machinery and equipment to develop and improve agricultural production. Agricultural tech helps farmers to make a variety of crops in a cost-effective and time-efficient way.
Everything from tractors to harvesters falls under the farm machinery segment. Ravels, shovels, and others are traditional agricultural tools whereas multifunctional machinery has been invented to ease out the whole process of agricultural production.
Key Strategies for Industry Growth
India is diverse in terms of its agricultural practices. The country is said to be the 2nd largest producer of groundnuts, rice, cotton, wheat, and sugarcane across the globe. Additionally, India is the 2nd largest producer of fruits and vegetables.
The Agricultural Machinery Industry is a cornerstone of this sector, going through its transformation phase in terms of technological advancements, policy shifts, localization efforts, and varying consumer preferences.
Here are some of the prime trends or strategies in shaping the Agricultural Machinery Industry in India.
Using Robotic Sprayers
Precision farming in India is experiencing a drastic transformation with the usage of robotic sprayers. It is mainly integrated into the farming sector to protect the crops. The majority of farmers nowadays prefer and use these automated systems due to their accuracy and efficiency.
In addition, using robotic sprayers results in optimal resource utilization along with minimal wastage of the same. Besides, farmers can conduct real-time monitoring and data analysis to improve efficiency and achieve higher crop yields along with lower environmental impacts.
Shifting Towards Localisation
Most of the small-scale agro machinery industries import cheap machinery from China which lacks reliability followed by after-sales service guidance. However, the industry is implementing a few strategic changes by reducing reliance on imports.
Now, the industry is focusing on increasing the production of high-end machinery locally. Moreover, small agri-machinery sectors are investing in local manufacturing capabilities to serve the domestic market and expand exports to neighboring international countries.
Agricultural Machinery Contracting
Numerous farmers choose to rent out farming equipment and tools for agricultural operations. This acts as a second source of income as low margins in crop production are forcing the farmers to do so. The agricultural workforce is gradually shifting to urban areas where a shortage of labor is a common site.
Therefore, this is raising the need to rent a variety of farm machinery at cheaper prices. Renting such equipment and machines is much more cost-effective than hiring laborers and buying new machines. Thus, indirectly, this is also playing a huge role in the growth of the Indian agro machinery industry.
Post-Harvest Residue Management Machinery
The growing emphasis on producing biofuels is what is driving the significance of biomass management in the agriculture sector of India. The government is aiming to reach 20% bioethanol blending in petrol within the year 2025 to 2026 (tentative).
Thus, there is an emerging need for high-tech Post-Harvest Residue Management Machinery. Some of such equipment is a combination of balers and harvesters, etc. This functions in such a way as to carry out effective residue management in the agricultural sector.
Challenges in the Industry
The agro machinery industry is leading the way in technological innovation and is responsible for the global upgradation of farming methods. The need for effective and sustainable agricultural solutions has increased along with the expansion of the world population. It has put manufacturers under enormous pressure to overcome a wide range of the following challenges.
Lack of Knowledge
The majority of farmers do not possess adequate knowledge and training on how to use the advanced farm machinery. India requires customized farm machinery and equipment due to the differences in farm size and soil types. In addition, farmers lack knowledge regarding the operations, maintenance, and repair of such multi-functional and high-tech machines and equipment.
Infrastructure of Rural India
Improvement in the infrastructure and distribution networks and providing farmers with convenient access to spare parts on-site for each farmer is much needed. In addition, they should get a technician’s assistance for advice and information related to the high-tech agricultural machines. This would help reduce downtime and boost the farmers’ confidence in accepting new technologies.
Lack of Finance
For the majority of Indian farmers, buying agricultural equipment involves a significant expense. Due to high equipment costs, farmers often cannot buy such advanced equipment. Considering India’s level of farm mechanization, more work needs to be done in terms of introducing better equipment for each farming process to minimize waste, boost productivity, and reduce labor expenses.
Bridging the Gap Between Indian Farmers and Farm Machinery Producers
The intricacies of India’s agricultural landscape reveal a concerted effort to align the needs of farmers with the capabilities of farm machinery producers. The aim? To strike the perfect balance in terms of price, quality, and efficiency of agricultural machinery, catering to both domestic and export markets.
In this journey, Indian farm machinery producers are working tirelessly to understand the diverse requirements of local farmers. By fine-tuning their offerings, they aim to deliver solutions that not only meet but exceed expectations, ensuring affordability without compromising on performance.
Simultaneously, efforts are underway to enhance the competitiveness of the Indian agricultural machinery industry on the global stage. Through strategic investments in innovation and technology, manufacturers are raising the bar in terms of quality and efficiency, making Indian products increasingly attractive to international buyers.
This concerted effort to bridge the gap between farmers’ needs and machinery producers’ offerings holds immense promise for the Indian agricultural sector. By fostering stronger synergies between stakeholders, India is poised to emerge as a global leader in agricultural machinery, driving growth both at home and abroad.
Future Outlook and Market Opportunities of the Agricultural Machinery Industry
In 2021, the market for agricultural equipment was estimated to be worth USD 2,43.77 billion globally. By 2030, it is anticipated to have grown at a compound annual growth rate (CAGR) of 6.12% to reach USD 4,16.08 billion (2022–2030).
Global population growth, rising agricultural mechanization, and farmer incomes are the main factors driving the global market for agricultural equipment. There is a clear reason why agricultural methods and machinery are and will continue to change with the world’s food consumption level.
Here are some of the market opportunities in the Agricultural Machinery Industry:
Positive Government Initiatives
To encourage the use of contemporary farming equipment and technology in India, the government has also introduced several programs. For instance, farmers might receive financial support from the National Food Security Mission (NFSM) to buy contemporary farming equipment and machinery. The program’s objectives are to advance mechanization and raise agricultural output.
Need for Rental Agricultural Equipment
Farm equipment rentals are becoming more and more necessary as a result of technological improvements that give farmers access to the newest innovations without requiring long-term commitments or financial risk. Besides, it is a more affordable option for having immediate access to such equipment.
Conclusion
As of 2024, the Indian farm machinery industry size is estimated to be around USD 16.73 billion. Additionally, it is expected that this industry will rise to USD 25.15 billion by 2029 within the next 4 to 5 years.
Partnering with a trusted advisor like Tecnova can be instrumental. We are known to be one of the best Agricultural Machinery Industry Consulting firms in India. With expertise in navigating technical innovations, fostering localized production, and implementing innovative strategies such as agricultural machine contracting, we stand ready to support the industry’s transformation journey.
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