Table of Contents
The agricultural machinery sector in South America has recently been facing difficult times. Falling commodity prices, increase in interest rates have affected the agricultural machinery industry. The objective of this report is to provide data and insights around the two important agricultural machinery markets in South America namely Argentina and Brazil. The report provides current market size for tractors and agricultural implements (2015) and forecasts the demand for these products until 2020.
Brazil and Argentina are emerging economies in South America. Demand for tractors in these two countries fluctuates with the change in interest rates and economic policies. At present, high interest rates in Brazil is hindering the tractor industry growth. The average land holding in Brazil and Argentina is more when compared to other developing countries like India; thus driving the demand for the higher HP tractors where they contribute for more than 60% of market share.
Brazil tractor market is driven by local production where as that of Argentina is driven by imports. Dealer network is the primary channel for sales and distribution with 1,000+ dealers in Brazil and 200+ dealers in Argentina. Brazil doesn’t impose local content sourcing requirements directly, but heavily subsidizes manufacturers for producing locally, whereas in Argentina, the country demands high local content requirement. The competition between players in these two countries is oligopolistic in nature. Massey Ferguson, CNH, Valtra, John Deere, Pauny Rods are the major players.
Summary of Key Findings:
The present tractor market in Brazil is XXX units and is expected to grow by X% CAGR over the next five years. Tractors in the range of 50-100HP have majority market share of XX% in Brazil. Implements market in Brazil has grown at the rate of XX% over the last five years. Tractor market in Brazil is driven by the local production. Top 4 players hold XX% of market share.
Argentina tractor market is estimated to be around XXX units and expected to grow at CAGR of X% in next five years. In spite of heavy duties, Argentina’s tractor market is import driven because of absence of local players. Soybeans, Sugarcane and Maize are the major crops driving tractor demand in Argentina.50-199 HP has the major market share of x% in Argentina. The fluctuating interest rates and economic policies are hindering the tractor market growth in Argentina.
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