Farm Equipment Market Size, Share, Growth, Report 2026 to 2035

Farm Equipment Market Size and Growth 2026 to 2035

The global farm equipment market size reached at USD 115.27 billion in 2025 and is expected to be worth around USD 173.82 billion by 2035, exhibiting at a compound annual growth rate (CAGR) of 4.2% over the forecast period 2026 to 2035. The farm equipment market is expanding, driven by increased global demand for food and commercial farming expansion in many regions. The growing global population places additional pressure on agricultural production and, as a result, many farmers are willing to utilize increasingly sophisticated and expensive modern mechanized tools to boost production. Labor shortages in rural areas are accelerating the transition to the mechanized farm equipment market. The adoption of GPS guidance, smart irrigation, and AI-assisted tractors improve the efficiency of farming operations and crop production. The adoption of new machines decreases input waste and increases profits for the more efficient farmer.

Government subsidies and programs for countrified financing strongly support the adoption of mechanization in the farm equipment market, especially in developing economies. The increased adoption of sustainable farming practices, is also increasing demand for energy-efficient and low-emission farm equipment. The growing popularity of custom hiring services are also reducing barriers to entry for small rural farmers to access costly equipment, thereby opening up the market for wide adoption. As a result of these factors, including continued urbanization and farmland consolidation, the farm equipment market is expected to experience positive growth in the long run.

Report Highlights

• By Region, Asia-Pacific dominates the global farm equipment market with 39.2% share.
• By Region, North America follows with 29.5%, driven by high mechanization and adoption of advanced technology.
• By Equipment, the tractors dominate the equipment segment with a 45% share of the market due to widespread tractor availability.
• By Power Source, the tractor-powered equipment dominates with a 52% share of market due to their easy accessibility by farmers.
• By Application, the cultivation and soil preparation equipment leads the segment with a 36% share as it is used in every cropping cycle.
• Technological advancements like GPS, AI, and autonomous machinery are enhancing farm productivity and efficiency.

Evolution of Farm Equipment Toward Green Technology

Agricultural machinery has come a long way, from hand tools and horse or animal power, to steam and diesel-powered machines during the industrial revolution. The introduction of farm tractors, mechanical-ploughs and harvesters improved productivity and reduced the need for labour on larger farms. Hydraulics, automation and precision-farming tech then ushered in a new era in agriculture. The advent of GPS-enabled and smart sensor equipment has resulted in better soil, crop, and water usage monitoring capabilities. This is whether farmers are utilizing traditional mechanical farming methods, or adopting more data-driven, technology supported farming capabilities.

For the last decade or so, firms have begun to develop farm equipment with green technology to help minimize environmental harms and support more sustainable farming approaches and practices. Currently, farm machinery companies are focused on electric tractors, solar powered irrigation systems, and low emissions engines to help farmers minimize their carbon footprint. Biofuel-driven machinery and more energy-efficient electronics allow farmers to operate more ecologically sustainable operations globally. Additionally, artificial intelligence and the Internet of Things (IoT) provides farms with input utilization betterment to help maximize ecological sustainability, while minimizing chemical fertilizers and water waste. This technology mirrors global change for sustainable food production and to broaden the adoption of more environmentally responsible practices.

Market Trends

1. Launch of new autonomous tractors by major OEMs

John Deere launched second-generation autonomous tractors called John Deere's autonomous tractors in early 2025 using AI, vision systems and autonomy kits. This represents an important milestone for the farm equipment market because it allows the mechanisation of farms at scale where human labour is in short supply, allowing larger farms to extend their operating hours and produce higher efficiencies with less reliance on human oversight.

2. Electrification of agricultural machinery

LOVOL is releasing the E1000 electric tractor in November 2025 at AGRITECHNICA 2025. A combination of zero-emission power and smart technology, the electric tractor is another example of how the electrification trend of agricultural machinery will support and drive the farm equipment market, while responding to sustainable interest from farmers, reducing operating costs and meeting new environmental regulations.

3. Widespread adoption of precision and autonomous farm machinery

The autonomous farm equipment market was valued at USD 70 billion in 2025 and is projected to continue to expand at more than 8% CAGR through 2035. This aligns with the agronomic trend towards stimulating farm equipment sales and demand for higher value, technologically advanced machines that offer improved yield and resource use and cause further replacement of traditional farm equipment.

4. Government-backed mechanisation and green technology initiatives in emerging markets

Demonstrations of e-tractors and electric tillers in 2025 by CSIR in India showed government backing for electric farm equipment amongst small and marginal farms without detrimental labor forces. Demonstration with government backing will expand access for smaller farmers to utilize mechanized and green equipment to reach a larger penetration in overall farm equipment.

Report Scope

Market Dynamics

Market Drivers

• Rising demand for food production: There is increased global population growth and demand for food production in every area of the world. Farmers are under pressure to produce more and yield more crops, leading to an increased adoption of modern and advanced machinery. The farm equipment sector is benefitting as farmers purchase more machinery to add speed to farming. In addition, farmers are operating more land under commercial farming. The demand for mechanized equipment continues to grow and continues to push the farm equipment market forward.
• Government support and subsidies: Many governments are providing a range of financial support and subsidies toward the mechanization of farms. They push the farming community to purchase tractors, harvesters, and irrigation equipment, increasing equipment adoption rates, especially in the developing world, keeping the farm equipment markets steady. Easy loans also allow farmers to purchase the equipment. As a result, demand is assured and stable, through some sort of government rural development programs.

Market Restraints

• High cost of advanced equipment: Modern farm equipment represents an expensive capital investment for farmers. Small and marginal farmers may not be able to afford modern machinery without financial assistance. Beyond the initial purchase price, farmers must account for maintenance and repair costs. These factors limit the growth opportunity of the farm equipment market. Elevated interest rates also contribute to financing challenges. For financial reasons, many farmers remain reliant on traditional hand tools.
• Lack of technical knowledge: Due to a lack of skills, many farmers are unable to fully realize the benefits of modern, digital farming and the use of farm equipment. Advanced technology requires training and an understanding of technology. In rural areas, access to training programs is often limited or completely unavailable. This lack of specialized training reduces the rate of adoption of high-tech machinery to more advanced farm equipment. A fear of damaging equipment, as well as limited technical service centers, further limits farmers ability to purchase farm equipment.

Market Opportunities

• Growth in precision agriculture: Precision agriculture technologies are becoming more popular among larger and medium scale farmers. GPS, sensors, and smart machines help farmers save money on inputs and increase yields, resulting in strong demand for advanced technology. This generates new opportunities for growth in the farm machinery market. Digital farming platforms are also growing quickly to increase the awareness and acceptance of smart technologies.
• Rising demand for electric and green machinery: Sustainable practices and eco-friendly farming practices are receiving increased attention all over the world. Farmers are adopting electric tractors and low-emission machinery to help minimize the negative impact on the environment. Supporting the adoption of green technology is a priority of governments and other organizations. This is creating a new revenue stream for companies within the farm machinery market. In addition, carbon reduction policies that some governments have implemented are promoting the adoption of green equipment. Energy savings is a factor too, as electric machinery becomes more cost-effective for farmers.

Market Challenges

• Dependence on weather and climate conditions: Agricultural endeavors have a considerable dependence on weather and climatic tendencies. Natural disasters such as droughts and floods impact farmers' ability to generate income and make capital investments. When farmers generate less income, they tend to postpone the purchase of farm equipment. This creates fluctuations in the farm equipment market as farmers seek to stabilize their financial situations before investing in equipment. Climate change has led to a greater unpredictability in weather conditions which accounts for an increasing amount of financial risk for both farmers and manufacturers.
• Supply chain disruptions and raw material costs: The farm equipment industry is a consumer of steel, electronics and other raw materials. If the costs for raw materials fluctuate, production costs to the manufacturer increases. Global supply chain disruptions also create delivery delays. Supply chain disruptions and price instability makes it difficult to operate markets for farm equipment. Chip and component supply shortages also influence production time frames for farm equipment. Increased costs of logistics, such as transportation, also influence prices of farm equipment.

Regional Analysis

The farm equipment market is segmented into various regions, including North America, Europe, Asia-Pacific, and LAMEA. Here is a brief overview of each region:

North America Farm Equipment Market: Driven by Rapid Technological Adoption and Rising Labor Shortages

The North America farm equipment market size reached at USD 34 billion in 2025 and is expected to surpass around USD 51.28 billion by 2035. The North America is propelled by increasing automation, precision-farming technologies, and chronic labor shortages. Farmers in the U.S., Mexico and Canada are acquiring smart tractors, GIS mapping, autonomous implements, and sensor-based systems to improve productivity. Government subsidies, and beneficial tax policies also help support purchases of large equipment. The move toward big-acre commercial farming also sustains demand for high-horsepower equipment. In addition, as older equipment fleets reach the end of their service lives, replacement demand helps stabilize and grow the market.

Recent Developments:

• Prominent OEMs introduced autonomous tractor prototypes at CES 2025 in the U.S.
• Equipment rental models are emerging in the U.S., allowing smaller farmers to engage with advanced machinery.
• Federal farm support programs (e.g. tax deductions for new equipment) further stimulate investment.

Asia-Pacific (APAC) Farm Equipment Market: Driven by Growing Mechanization Needs and Expanding Agricultural Infrastructure

The Asia-Pacific farm equipment market size estimated at USD 45.19 billion in 2025 and is projected to reach around USD 68.14 billion by 2035. The Asia-Pacific region market growth is fueled by the immediate necessity to mechanise production with declining rural workforces and increasing agricultural wages, particularly in India, China, and Southeast Asia. Governments in these markets are offering financial incentives for equipment procurement, and smallholder farming is slowly adopting modern equipment. Rising rural incomes and croppable intensification are also partly driving serial adoption of tractors and harvesting machinery. Hence the Asia-Pacific region provides scope for both scaling opportunities and rapid growth.

Recent Developments:

• China, India and Southeast Asia are ramping up subsidies and availability of credit for mechanised equipment.
• In Thailand and Malaysia, high-speed transplanters and precision machinery are being introduced as substitutes for labour.
• Adoption of electric and smart irrigation‐equipment is increasing as farmers cope with climate variation and water scarcity.

Europe Farm Equipment Market: Driven by Strong Sustainability Regulations and Digital Farming Initiatives

The Europe farm equipment market size reached at USD 24.32 billion in 2025 and is forecasted to hit around USD 36.68 billion by 2035. The European market for farm equipment is being propelled by a movement towards sustainability, emission-reduction, and the digitalisation of farming. Farmers and equipment manufacturers are adopting low-emission, sensor-rich machinery, electric tractors, and precision systems in compliance with regulatory burden and labour shortages. With the consolidation of farms and rising labour costs, the trend is towards larger and smarter machinery, moving the European market past horsepower to "smart farming."

Recent Developments:

• The EU's Green Deal and associated regulations are driving equipment manufactures towards the production of eco-friendly machines with lower emissions.
• Germany's manufacturers (e.g., large tractor and harvester providers) have begun developing software and retrofit-capable platforms for equipment.
• Farmers are beginning to protest the regulatory burden in the EU, illustrating the stress between sustainability and the ability to invest.

Farm Equipment Market Share, By Region, 2025 (%)

LAMEA Farm Equipment Market: Driven by Rising Food Demand and Increasing Agricultural Infrastructure Investments

The LAMEA farm equipment market size valued at USD 11.76 billion in 2025 and is anticipated to reach around USD 17.73 billion by 2035. The LAMEA is influenced by increasing food need, urbanisation, and government infrastructure spending in agriculture. In Latin America, rising population and export-oriented farming models are driving the need for modern machinery. In the Middle East and Africa, additional traction is given to irrigation, land-development and machinery for arid areas. Governments are working with an increasing number of subsidies and partnerships, facilitating mechanisation in underserved areas. Overall, the region shows opportunities growing quickly, but from a lower base.

Recent Developments:

• Middle East and Africa governments publicly launching large-scale mechanisation initiatives, and investing in water-efficient technologies and training in their use.
• Latin American countries (e.g. Argentina, Chile) increasing R&D in farm equipment and adopting precision agriculture practices to drive yield improvements.

Segmental Analysis

The farm equipment market is segmented into equipment, power source, application, and region.

Equipment Analysis

Tractors are the leading segment in the farm equipment market because they are utilized in nearly all aspects of the farming operation. Tractors are used for plowing, sowing, moving or hauling, spraying, and for providing power to various attachments. The multi-functional capabilities of tractors also reduce the need to have multiple different machines for each task. Strong demand from both small and large farm producers further supports the segment dominance of tractors in the agricultural market. The growth of tractors in developing economies has also been aided by government subsidies often coupled with easy financing. Continuous improvement in engine efficiency, and comfort and convenience features, also adds to the leadership of tractors in the farm equipment market.

Harvesting equipment represents the fastest growing segment of the farm equipment market due to increased labor shortages and the need for faster harvesting of crops. Farmers prefer combining harvesters due to combining the labor associated with harvest and minimization of crop loss. Larger farm size also adds to the demand for harvesting equipment with farmers developing multi-cropping systems to improve harvest and farm income. Harvesters have also added automation capabilities, precision features, and the ability to manipulate specific yield factors to the harvesting equipment market to improve efficiency and produce higher yields. The growth of larger scale commercial farming and contract farming management models has also contributed to the gaining segment of harvesting equipment.

Power Source Analysis

Tractor-powered equipment leads the market as tractors are central to agricultural mechanization worldwide. Most basic and advanced agriculture implements operate using tractor power, through use of the PTO and hydrualic system. High existing tractor penetration within major agricultural economies provides definite strength to this already strong segment. Farmers typically prefer tractor-powered machinery due to their reliability and availability of service and support. This segment of equipment also benefits from the continued development of more reliable, durable and powerful tractors. Tractor-powered farm implements have, and continue to be, a stable segment with high demand, especially in North America and Europe.

Farm Equipment Market Share, By Power Source, 2025 (%)

Electric and battery-powered equipment is the fastest growing segment since farmers are placing greater emphasis on sustainable farming practices. Farmers have responded to the rising costs of fuel and changing emissions regulations by seeking out electric power options. Advances in battery technology have increased operating times and improved performance of electric machines. Government incentives have demonstrated support for adoption of low-emission agricultural machinery and implement. Furthermore, manufacturers have initiated programs to market newly designed electric tractors and small farm machines in order to meet this growing demand. Changes in sustainability from both the consumer and manufacturer side have resulted in the rapid growth of this segment of agriculture machinery.

Application Analysis

The cultivation and soil preparation segments continue to dominate the industry because all farming operations start with land preparation. The use of equipment (e.g. ploughs, cultivators, tillers, and harrows) for cultivation occurs repeatedly within each cropping cycle. This means that there will always be a continuous demand for soil preparation machines in every geography. The greater the number of uses, the higher the demand for replacement or maintenance of equipment. The growth of mechanized agriculture in Asia and Africa has helped facilitate growth in this application segment. This application segment remains a foundation, driving overall equipment sales.

Farm Equipment Market Share, By Distribution Channel, 2025 (%)

The harvesting application segment continues to be the fastest growing application segment of farm equipment because of the demand for fast, efficient harvesting of crops. Harvesting windows are getting shorter and the weather is unpredictable, requiring rapid operations in the field. Mechanized harvesting of crops helps reduce the reliance on seasonal labor, and mitigates losses associated with post-harvest management. Additionally, rising wages in rural agrarian communities mean that machines have become similarly cost-effective. The adoption of smart harvesting technologies is having a marked stimulus effect on demand for harvesting machinery. Altogether, it is expected that this application segment will continue to see sustained growth.

Farm Equipment Market Top Companies

• Deere & Company (John Deere)
• CNH Industrial
• AGCO Corporation
• Kubota Corporation
• CLAAS Group
• Mahindra & Mahindra Ltd.
• Yanmar Holdings Co., Ltd.
• Toyo Corporation (Iseki & Co., Ltd.)
• Alamo Group Inc.
• SDF Group (SAME Deutz-Fahr)
• Minsk Tractor Works (MTZ)
• JCB Agriculture
• Lovol Heavy Industry
• Changfa Group
• YTO Group Corporation

Recent Technologies

Autonomous and Automated Agriculture Equipment

John Deere has rolled out autonomy-ready tractors and an Autonomy Precision Upgrade which enables existing machinery to operate with limited human intervention. This technology is propelling the farm equipment industry as it provides enhanced efficiency, reduces the need for labor, and allows high-volume producers to retrofit aging fleets rather than invest in a new equipment.

Electric & Driver Optional Tractors

Monarch Tractor launched the MK-V, a fully electric, optionally autonomous tractor with cloud-based connectedness and AI fleet management software. This advancement is pushing the farm equipment market toward sustainability and lower operating costs of the equipment investment, making sustainable equipment a legitimate option for farms of the future.

3. Solar-Powered Robot for Seeding and Weeding

FarmDroid's FD20 is a fully automated state-of-the-art, solar-powered autonomous robot that uses high-accuracy RTK GPS and solar-power productively without the need to recharge. This technology is driving the agricultural equipment market by allowing fully autonomous (self-propelled) field operations that reduces task reliance on human labor and chemical usage with alternative approaches to seeding and weeding, particularly for specialty crop and sustainable crop producers.

Market Segmentation

By Equipment

• Tractors
• Harvesting equipment
• Sprayers
• Balers
• Others

By Power Source

• Mechanical
• Tractor-powered
• Electric & battery-powered

By Automation

• Manual
• Semi-Automatic
• Automatic

By End Users

• Individual Farmers
• Commercial Farm
• By Application
• Cultivation and soil preparation
• Planting and seeding
• Harvesting
• Livestock
• Others

By Region

• North America
• APAC
• Europe
• LAMEA