South Africa Agricultural Machinery Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

South Africa Agricultural Machinery Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The South African Agricultural Machinery Market is projected0 to register a CAGR of 5.6% during the forecast period (2021-2026). During Covid19, the sector has seen a sharp dip in the agricultural machinery business and the most affected segment could be the dealership network due to the disruption supply chain and also manufacturing units were not 100 % active. Due to the travel restrictions, production of goods is delayed, as supply is being interrupted had resulted in a sharp decrease in sales of agricultural machinery business during 2019-2020. Agriculture has been one of the most important sectors of the South African economy. Gulf countries and the Arab world remain reliant on South Africa for grains, fruits, and vegetables. It is one of the few countries in Africa to be economically developed is a fact that drives agricultural machinery adoption. Labour shortage and an increase in daily wages are also some of the other prime market drivers. The agricultural sector contributed around 10 percent to South Africa’s total export earnings in FY 2019 at a value of $10.7 billion. Citrus, wine, table grapes, corn, and wool accounted for the largest exports by value. South Africa also exports nuts, sugar, mohair, apples, and pears to name just a few products. The major products imported were rice, wheat, chicken cuts and offal, palm oil, whiskies, cane sugar and soybean meal.

Key Market TrendsFarm Labor Shortage Drives the Market

The shortage of farm labor became a serious problem in South Africa causing a rise in labor wages. This accelerated the sales of farm machinery and aided in market growth. According to the World Bank survey, only 5.0% of the total South African employees were working in the Agriculture sector in 2018. Inadequate services and limited access to financial capital are leading to migration from rural areas to urban centers, in search of work. According to the World Bank, Sub Saharan Africa experienced an annual urban population growth rate of 2.1% in 2019. This is leading to a labor shortage in the agriculture sector.

Rise in the Tractor Sales

Tractors Market is one of the most important segments of South African Agricultural Machinery. Tractor, being basic agriculture machinery, occupies the major part of Agriculture machinery in terms of units sold. A continuous increase in tractors sales is noticed for the last few years. The average number of tractors per thousand hectares of land in South Africa was 3.8 in 2018, which was 3.2 in 2017. The tractor sales were fuelled by increasing government subsidies for farm mechanization, accommodative financing, growth in the agricultural industry and increased awareness towards farm machine mechanization.

Competitive Landscape

The market is consolidated owing to the presence of a few prominent players, accounting for more than half of the market. The key players in the market include Deere and Company, AGCO Corporation, CNH Industrial N.V, Mahindra & Mahindra South Africa Pty Ltd, and Kubota Corporation. The main strategy adopted by the key players has been to invest in R&D to encourage innovation and maintain a strong market base. The advent of advanced technologies like Artificial Intelligence, Robotics, Google Earth, and a growing number of government initiatives have driven the demand for the South African agricultural machinery market to rise.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned

IBM Corporation
Oracle Corporation
Internap Corporation
Packet Inc. (An Equinix Inc. Company)
Scaleway Inc.
Amazon Web Services Inc
Rackspace Inc.
CenturyLink, Inc.
LightEdge Solutions, Inc

Please note: This publisher does offer titles that are created upon receipt of order. If you are purchasing a PDF Email Delivery option above, the report will take approximately 2 business days to prepare and deliver.