Spain Agricultural Machinery Market Size & Share Analysis - Growth Trends & Forecasts (2023 - 2028)

The Spain Agricultural Machinery Market size is estimated at USD 711.65 million in 2023, and is expected to reach USD 870 million by 2028, growing at a CAGR of 4.10% during the forecast period (2023-2028).

Key Highlights

• The market is driven by increasing rates of mechanization in developing countries. The shrinking land, water resources, and labor force have increased the need for farm mechanization in developed European nations like Spain.
• Spain has over 46.8 million food consumers and is the fourth-largest food market in Western Europe. Despite its high population density, it has more than 50% of its area under agricultural land, covering more than 2 million hectares. The country witnessed a massive increase in farm mechanization in terms of agricultural and industrial productivity, driven by a technological revival in the last decade.
• The Spanish government is looking to increase the quantity and revenues from agricultural products exported by 2025, but they are not necessarily focused on increasing the share of farming exports as a proportion of total exports. To achieve this goal, the government is likely to identify regions in Spain that currently produce export foods and have the potential to increase production through new institutional reforms. By implementing these reforms, the government hopes to increase the amount of agricultural products that can be exported from these regions and generate more revenue for the country.
• Additionally, in Spain, the Positive Agriculture project aims to improve the living conditions of those in the agricultural supply chain and provide essential equipment sustainably. This aim joins an already announced objective to reduce total greenhouse gas (GHC) emissions by 40% by 2030 and zero emissions by 2040. The adoption of energy-efficient machinery will further enable greater usage of agricultural machinery to support crop yield in the country.

Spain Agricultural Machinery Market Trends

Increasing Farm Mechanization to improve Crop Productivity

• Agriculture mechanization reduces crop cultivation costs and increases productivity by efficiently using other inputs and natural resources. Agricultural mechanization has shifted from traditional tools to sophisticated machinery to meet the targets for capacity enhancement, timeliness of farm operations, and efficient utilization of inputs. It has also been observed that the percentage growth of tractors, pump sets, and threshers has been higher in marginal and smallholding categories of the farmers who are more aware of farm mechanization's importance in the country.
• In the current scenario, farmers are achieving higher yields by adopting technologies such as drip irrigation systems and fertigation, driving the demand in the Spanish market for agricultural machinery and technology. The Government of Spain recognizes the impact of farm technologies and machinery on the country's agricultural sector, where 6% of Spain's workers are employed in agriculture, contributing to about 3% of the country's GDP. Owing to these benefits, the government is providing subsidies to farmers, making them aware of the benefits of agricultural mechanization.
• The market is currently in the growth stage, and manufacturers seek capacity augmentation in the country. Northern Spain still has little farm mechanization, and vendors can explore the province with a portfolio of medium-sized machinery suitable for hilly terrains. The demand for agriculture tractors in Central and Southern provinces will be high in the coming years. In the Eastern province, dry farming land is used to grow crops like wheat, barley, olives, and grapes. However, the irrigated land is much more productive and produces most of the Eastern province's agricultural output. The main crops grown in the irrigated zones are fruit, fodder, and corn (maize).
• The combined penetration of mechanized implements and tractors in the Eastern zone is close to 32%, with manual and animal-driven tools comprising 38% and 30%, respectively, during 2021. Wheat and barley are significant crops, constituting 28% and 16% of the total crop production in Eastern Spain in 2021.

Tractors Dominates the Agricultural Machinery Market

• The increasing mechanization of agriculture has led to a growing demand for row-crop tractors in recent years. This is primarily because modern farming techniques require more efficient and specialized equipment to maintain large fields and increase yields. As the availability of farm laborers becomes increasingly limited, many farmers are turning to mechanized solutions to fill the labor gap. Row-crop tractors are an ideal tool for this purpose, as they are designed to efficiently plant, cultivate, and harvest crops in large fields. They are also highly versatile, allowing farmers to use them for various tasks, such as tilling, spraying, and hauling.
• Utility tractors indeed have a lot of uses and can be very versatile machines. They are especially useful for small and medium-sized farms as they are compact, easy to operate, and can perform various tasks. The ability to attach different types of equipment to the tractor makes it a very useful tool for farmers and agricultural workers. Additionally, the low cost of utility tractors makes them attractive for those on a budget or just starting in the agricultural industry. Overall, utility tractors are a valuable asset to any farm or agricultural operation, and their flexibility and versatility make them a popular choice among farmers and agricultural workers.
• According to the European Agricultural Machinery Association (CEMA), tractor registrations in Spain increased by 10.0% in 2021, but the 10,905 units registered were 1.2% below the previous 5-year on average units. By type of tractor, 94 were crawlers, 5,278 were standard, and 5533 were narrow tracks.

Spain Agricultural Machinery Industry Overview

The Spain agricultural machinery market is slightly fragmented, with numerous players cornering most of the market share. The key players in the market include Deere and Company, AGCO Corporation, CNH Industrial NV, Kuhn Group, and Lamborghini Tractors. New product launches, partnerships, and acquisitions are the major strategies adopted by the leading companies in the market in the country. Along with innovations and expansions, developing novel product portfolios will likely be the crucial strategy in the coming years. These companies are making strategic partnerships by partnering with domestic companies to expand their distribution network and launch new innovative tractors that cater to the needs of the farmers in this region.

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