Market Trends of India Agricultural Tractor Industry
30-50 HP Tractors Are Widely Preferred
- 30 HP- 50 HP are moderate horsepower tractors that work well in soft soil conditions, such as river basins. In India, the demand for 30 HP- 50 HP tractors is high owing to low disposable income of farmers and high labor costs. Due to small farmland sizes, farmers prefer small and customized tractors for agricultural purposes. Moreover, less fuel consumption by small tractors helps to empower small and marginal farmers.
- Furthermore, with the average size of household ownership decreasing, farm holdings are seeing a downward trend. 30-50 HP tractors are viable and efficient for small farm holdings and are vital to increasing productivity. Therefore, 30 to 50-horsepower tractors are most commonly used in India.
- The players in the market are also focusing on launching new models to increase their market share. For instance, in November 2022, VST Tillers Tractors Ltd and Zetor Tractors launched two new tractor models with 40 and 50 HP engine capacities, respectively.
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Uttar Pradesh Provides the Biggest Market for Tractors
- Agriculture is the most crucial aspect of the Uttar Pradesh economy, contributing 28% to the economy in 2022, according to the Ministry of Statistics and Program Implementation (PRS). It is the primary source of livelihood for a significant portion of the state’s population. The vast agricultural activities in the states drive the market for agricultural machinery, including tractors. Tractors are mainly used to carry out various farming tasks such as plowing, tilling, sowing, harrowing, and harvesting, thereby increasing the efficiency and productivity of agriculture in the state.
- In Uttar Pradesh, the fragmentation of land holdings has led to smaller land parcels, making traditional manual labor-intensive farming less feasible. Tractors offer a more efficient alternative for small-scale farmers to manage their land. This has led to the increased adoption of tractors in farming practices, making Uttar Pradesh the first state with more tractor sales in India.
