Agriculture Industry: Market Research Reports, Statistics and Analysis

Key Market Segments

• Worldwide demand for agricultural equipment is expected to grow at close to 5% per year through 2014 to reach $123 billion, according to Freedonia. Market growth will be fuelled by mechanization of emerging market agricultural industries. Expansion will be particularly strong in India and China due to economic growth, large populations and growing food consumption. Government investment in agriculture mechanization to improve crops will aid market growth. Most of the world’s top agricultural equipment manufacturers are headquartered in developed nations. China outpaced the US in 2009 as the world’s number-one supplier, making $17 billion worth of shipments.

• The world seeds market is predicted to reach $47 billion by 2015, reports Global Industry Analysts. Rising population with higher food demand coupled with higher farming standards and biotechnology in growing seeds are fuelling the agriculture sector. Developments in seed production such as hybrid seeds, pest-resistant seeds and biotech crops are fuelling demand.

• Demand for fertilizers is expected to grow at 3% a year though 2014 to 380 million metric tons, according to Freedonia. Under pressure to produce better crops due to the declining surface of arable land available, growing population and high-protein products demand, farmers are increasingly reliant on fertilizers. Demand is also driven by the golf industry, which is building more golf courses across industrializing nations where middle-class incomes are rising. Fertilizer is used by both domestic and professional gardeners to improve lawn health in particular.

• The world pesticide industry is expected to pick up again after the low of 2009. The industry, worth $45 billion, is forecast to rally and show some degree of growth, according to Freedonia. However, profit will be tempered by market maturity and challenging pricing practices. Due to market maturity in older markets such as Western Europe and North America, these regions will likely see under-average growth in the years to come. Asia-Pacific on the other hand is expected to see a good degree of market expansion, especially in Indonesia, China and Thailand. Developing countries that traditionally did not use pesticide are not adopting the practice, growing demand in places such as India.

• Central and South America comprise the region expected to see the strongest growth. Brazil is predicted to register above regional average growth, which is already outpacing the world average. Growth will also be recorded in some regions of the Middle East and in Africa.

Market Outlook

Russia, Brazil and Ukraine are set to join the ranks of long-standing agricultural goods exporters such as the US, the EU and Australia. Challenges facing the agricultural industry include limited arable land, climate conditions and the increasing expense of materials such as fertilizers and equipment. There is 1.5 billion hectares of arable land in the world, which is worth around $5 trillion.

Less direct elements such as interest rates, regulations and earnings are also a factor for the agricultural industry. With $13 billion invested in agriculture or agriculture-related sectors since 2007, the industry will see increased investment. The agricultural sector will concentrate on increasing output through scientific and technological innovation.

Leading Industry Associations

• American Agricultural Economics Association www.aaea.org
• American Farmers Association www.americanfarmersassociation.com
• European Association of Agricultural Economists www.eaae.org
• National Association of Agricultural Contractors www.naac.co.uk
• National Farmers Union www.nfuonline.com