Latin America Agricultural Machinery Market Size
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 8.40 Billion |
| Market Size (2029) | USD 10.40 Billion |
| CAGR (2024 - 2029) | 4.30 % |
| Market Concentration | High |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Latin America Agricultural Machinery Market Analysis
The Latin America Agricultural Machinery Market size is estimated at USD 8.40 billion in 2024, and is expected to reach USD 10.40 billion by 2029, growing at a CAGR of 4.30% during the forecast period (2024-2029).
- Farmers across Mexico, Argentina, and Brazil are increasingly embracing mechanization on their farms. As global food demand surges and the push for efficient production intensifies, agricultural machinery is gaining traction worldwide. Government subsidy programs play a pivotal role in this trend, easing the financial burden on farmers. By offering financial aid, these programs empower farmers to invest in machinery, thereby boosting their productivity. For example, Brazil's Ministry of Agriculture, Livestock and Farming, in 2022-2023, raised the budget for its credit Programme for the Modernisation of Agricultural Tractors and Harvesters from BRL 7.53 billion (USD 1.4 billion) to BRL 10.16 billion (USD 1.9 billion).
- With the increase in harvest areas and revenues, farmers have more disposable income to channel into machinery and other agricultural inputs. Local players dominate the Central and South American agricultural machinery market. In a bid to capture farmer interest, the players are rolling out innovative technologies. Rising labor costs, a consistent trend in the region, further propel the shift toward mechanization. For instance, Brazil's minimum monthly wage saw an increase from BRL 1,212 (USD 246.7) in 2022 to BRL 1,302 (USD 266.1) in 2023, as reported by Portal Brazil.
Latin America Agricultural Machinery Market Trends
Increase in Area Harvested in Latin America
- As farms in Brazil consolidate into larger units, the demand for more powerful agricultural machinery is growing. Data from the Brazilian Institute of Geography and Statistics revealed that Brazil's agricultural production area expanded from 86.7 million hectares in 2021 to 91.1 million hectares in 2022. This consolidation trend is driven by the desire to share heavy machinery costs. Recent regional trends indicate that larger farms are acquiring smaller ones. Urbanization is a key driver, offering rural residents new opportunities. As a result, many are moving to urban areas, leading to a decline in small landholdings and reduced farming profits. Fewer small farmers mean larger landholdings, which boosts farm mechanization. This mechanization heightens the demand for agricultural machinery, allowing quicker coverage of larger land areas and enhancing productivity and yields. Typically, small-holding farmers cultivate crops primarily for self-consumption, limiting their use of agricultural machinery.
- In Mexico, the rising demand for agricultural machinery is driven by the need for heightened agricultural productivity. This is fueled by the country's growing food demand, which parallels its population growth. According to the USDA Foreign Agricultural Service, corn consumption in Mexico jumped from 43.8 million metric tons in 2019 to 45.7 million metric tons in 2023. Such a spike underscores the pressing need to boost crop productivity, a challenge that can be met through agricultural advancements, including the adoption of modern farming machinery.
Brazilian Tractors Dominate the Market
- The use of tractors brought about an important change in agricultural mechanization in the country. Compact and utility tractors are used in Brazil as small-sized tractors with less horsepower. They are also helpful in landscaping operations, tilling, mowing, etc. As lawn making is one of the country’s famous activities, the usage of these tractors is rising. There were a total of 2,735 lawn care services in Brazil as of 2023. The high number of lawn care services in the country supports the usage of tractors below 80 HP, thereby driving segmental growth.
- The continuous launch of tractors below or with 80 HP is boosting the segment’s growth. For instance, in 2023, XCMG Brazil launched the agricultural tractor XT804-4D at Agrishow 2023 (International Fair of Agricultural Technology in Action) in São Paulo, Brazil. The tractor comes with 80 HP and is specially developed to meet the growing demand of the national market and bring more power and comfort to farmers in Brazil.
- International vendors that started investing in Latin America also brought their expertise to the field of agriculture equipment. These players use their global presence and capabilities to invest in research and development to innovate traditional farming activities. Innovative agriculture technologies and products help farmers increase yields from the same acreage of land. Furthermore, the Brazilian government released a Crop Plan for the 2022-2023 season. This bill allowed small farmers to get credit to buy agricultural machinery, including tractors, at a 5% annual interest rate. Therefore, advancements in farm technology and mechanization of the production systems of major crops such as soybeans are anticipated to increase the market's growth during the forecast period.
Latin America Agricultural Machinery Industry Overview
In Latin America, the agricultural tractors market is dominated by a handful of players, with the majority of the market share concentrated among them. Key players include Deere and Company, AGCO Corporation, CNH Industrial NV, Mahindra and Mahindra Ltd, and Kubota Corporation. These leading companies primarily focus on R&D investments, fostering innovation, and solidifying their market presence.
In the regions, leading firms predominantly employ strategies like new product launches, partnerships, and acquisitions. These firms are forging strategic alliances with domestic companies to bolster their distribution networks and introduce innovative tractors tailored to local farmers' needs.
Latin America Agricultural Machinery Market Leaders
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John Deere
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AGCO
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Mahindra and Mahindra Ltd
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CNH Industrial
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Kubota Corporation
*Disclaimer: Major Players sorted in no particular order
Latin America Agricultural Machinery Market News
- August 2023: Mahindra and Mahindra Ltd launched four revolutionary OJA tractor platforms in Brazil with the mission of transforming farming. The OJA is Mahindra’s most ambitious lightweight tractor platform, developed in collaboration with Mitsubishi Mahindra Agriculture Machinery, Japan, at an investment of USD 145 million. OJA was expected to be launched in India, North America, Japan, ASEAN, Australia, South Africa, Europe, and the SAARC region.
- February 2022: John Deere announced the selection of new companies for its Startup Collaborator program, which sought to deepen the relationship of the multinational with innovative emerging companies, boosting new technology solutions for Argentina's agriculture machinery in the field of farm operations.
Latin America Agricultural Machinery Market Report - Table of Contents
1. INTRODUCTION
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Market Overview
4.2 Market Drivers
4.2.1 Increase in Area Harvested in Latin America
4.2.2 Rising Farm Labor Cost is Driving The Market
4.2.3 Government policies fueling the market
4.3 Market Restraints
4.3.1 Economic Fluctuations in Commodity Prices is Hindering Farmer Purchasing Power
4.3.2 Environmental Concerns is Limiting The Market
4.4 Porter's Five Forces Analysis
4.4.1 Bargaining Power of Buyers
4.4.2 Bargaining Power of Suppliers
4.4.3 Threat of New Entrants
4.4.4 Threat of Substitute Products
4.4.5 Competitive Rivalry
5. MARKET SEGMENTATION
5.1 Type
5.1.1 Tractors
5.1.1.1 Engine Power
5.1.1.1.1 Less than 40 HP
5.1.1.1.2 41 to 60 HP
5.1.1.1.3 61 to 100 HP
5.1.1.1.4 101 to 150 HP
5.1.1.1.5 More than 150 HP
5.1.2 Equipment
5.1.2.1 Plows
5.1.2.2 Harrows
5.1.2.3 Rotovators and Cultivators
5.1.2.4 Other Equipment
5.1.3 Irrigation Machinery
5.1.3.1 Sprinkler Irrigation
5.1.3.2 Drip Irrigation
5.1.3.3 Other Irrigation Machinery
5.1.4 Harvesting Machinery
5.1.4.1 Combine Harvesters
5.1.4.2 Forage Harvesters
5.1.4.3 Other Harvesting Machinery
5.1.5 Haying and Forage Machinery
5.1.5.1 Mowers and Conditioners
5.1.5.2 Balers
5.1.5.3 Other Haying and Forage Machinery
5.2 Geography
5.2.1 Brazil
5.2.2 Argentina
5.2.3 Mexico
5.2.4 Peru
5.2.5 Chile
5.2.6 Rest of Latin America
6. COMPETITIVE LANDSCAPE
6.1 Most Adopted Strategies
6.2 Market Share Analysis
6.3 Company Profiles
6.3.1 AGCO Corporation
6.3.2 CNH Industrial NV
6.3.3 Deere & Company
6.3.4 Kubota Corporation
6.3.5 Mahindra and Mahindra Ltd
6.3.6 CLAAS KGaA mbH
6.3.7 Kuhn Group
6.3.8 Yanmar Co. Ltd
6.3.9 Agrale SA
6.3.10 Aquafim Culiacan
6.3.11 EnorossiMexicana SA de C
6.3.12 Jumil Mexico Implementos Agricolas
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
Latin America Agricultural Machinery Industry Segmentation
Agricultural machinery relates to the mechanical structures and devices used in farming or other agriculture. There are many types of equipment, from hand tools and power tools to tractors and countless kinds of farm implements. Agricultural machinery helps carry out the agriculture process efficiently.
The Latin American agricultural machinery market is segmented by type (tractors, equipment, irrigation machinery, harvesting machinery, and haying and forage machinery) and geography (Brazil, Argentina, Mexico, Peru, Chile, and Rest of Latin America). The market sizing has been provided in value terms (USD) for all the above-mentioned segments.
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Latin America Agricultural Machinery Market Research FAQs
How big is the Latin America Agricultural Machinery Market?
The Latin America Agricultural Machinery Market size is expected to reach USD 8.40 billion in 2024 and grow at a CAGR of 4.30% to reach USD 10.40 billion by 2029.
What is the current Latin America Agricultural Machinery Market size?
In 2024, the Latin America Agricultural Machinery Market size is expected to reach USD 8.40 billion.
Who are the key players in Latin America Agricultural Machinery Market?
John Deere, AGCO, Mahindra and Mahindra Ltd, CNH Industrial and Kubota Corporation are the major companies operating in the Latin America Agricultural Machinery Market.
What years does this Latin America Agricultural Machinery Market cover, and what was the market size in 2023?
In 2023, the Latin America Agricultural Machinery Market size was estimated at USD 8.04 billion. The report covers the Latin America Agricultural Machinery Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Latin America Agricultural Machinery Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
LATAM Agricultural Machinery Industry Report
Statistics for the 2024 LATAM Agricultural Machinery market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. LATAM Agricultural Machinery analysis includes a market forecast outlook to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
