According to an Italian study, the agricultural machinery market will remain dominated by Europe and North America in the coming years. However, countries like Indonesia, Vietnam, the Philippines, and Thailand are expected to play an increasingly significant role, as they are already seeing growth in imports of specialized machinery.
Population Growth Driving Demand for Agricultural Technologies
At the EIMA exhibition held from November 6-10 in Bologna, Italy, the Italian Agricultural Machinery Manufacturers Federation (FederUnacoma) hosted a conference presenting a market analysis of the agricultural machinery sector. Several key points were discussed during the event.
Population growth, a major driver of the increasing demand for agricultural technologies, will play a pivotal role in Africa, especially in countries like Nigeria, Ethiopia, and the Democratic Republic of Congo.
While established markets in Europe and North America will continue to invest heavily to maintain high-quality standards, major players in Asia, such as India and China, are expected to stabilize their mechanized farming practices after significant advancements in recent years. However, the most dynamic growth is anticipated in Southeast Asia and Africa.
Regions experiencing rapid population growth will see a surge in demand for agricultural machinery. These areas are undergoing significant agricultural development and require more advanced technologies to address the challenges of feeding expanding populations.
Indonesia is a prime example. With a population approaching 300 million, it ranks among the world’s most populous nations and is poised for continued demographic growth. Over the past 15 years, Indonesia’s imports of agricultural machinery have steadily increased, rising from EUR 140 million in 2009 to nearly EUR 700 million in 2023—an average annual growth rate of 8.6%. Looking ahead to 2024-2027, imports are expected to continue growing at an annual rate of 6.7%.
Other Southeast Asian countries are also experiencing strong growth in agricultural machinery imports. Vietnam, with a population of 100 million, anticipates an annual growth rate of 6.2% over the next four years. The Philippines, home to 110 million people, expects imports to grow by 7.8% annually. Meanwhile, Thailand, with 71 million residents, is projected to shift from a slow growth rate of just 1% per year over the last 15 years to a more robust increase of 6.8% annually from 2024 to 2027.
Population growth will also be a key driver in Africa, where regions like Sub-Saharan Africa are expected to account for 50% of global population growth by 2050. Nigeria, which already has 230 million people, is projected to exceed 400 million by 2050, making it the third most populous country in the world. Ethiopia and the Democratic Republic of Congo, both with populations exceeding 100 million, are also expected to experience significant growth, entering the ranks of the 10 most populous countries over the next 20 years.
In Nigeria, only 46% of cultivable land is currently being used for agriculture, while the Democratic Republic of Congo is utilizing just 10% of its arable land. Expanding agricultural land is a top priority for these countries, and as they look to bring more land into production, the demand for agricultural technologies will increase dramatically. Over the next few years, agricultural machinery imports in Ethiopia and the Democratic Republic of Congo are projected to grow by 7% and 12% per year, respectively, from now until 2027. This growth is expected to accelerate even further over the next two decades.
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