Smart Agriculture Market by Agriculture (Precision Farming, Livestock, Aquaculture, and Greenhouse), Component (Solution, Service, and Connectivity Technology), and Regional Analysis (North America, Europe, Asia-Pacific, and LAMEA): Global Opportunity Analysis and Industry Forecast, 2021–2028

Global Smart Agriculture Market Analysis

The global smart agriculture market is predicted to garner $54,949.90 million in the 2021–2028 timeframe, growing from $26,642.60 million in 2020, at a healthy CAGR of 10.90%.

Market Synopsis

Strategic alliances among market players, along with growing digitization in agriculture, are expected to accelerate the growth of the smart agriculture market.

However, lack of technological awareness and high initial capital investments might be growth-restricting factors for the market.

According to the regional analysis, the Asia-Pacific smart agriculture market share is anticipated to grow during the review period with CAGR of 10.10% and expected to generate revenue $14,396.90 in 2028 million due to increasing consciousness of consumers about benefits of smart agriculture.

Smart Agriculture Overview

Smart agriculture is the type of agriculture farming that uses technologies such as artificial intelligence, robots, internet of things, location systems, and sensors to increase the quantity and quality of crops of field. Also, it reduces the labor cost. Moreover, there are many technologies used in smart agriculture such as precision irrigation & precise plant nutrition, climate management & control, sensors, software platforms, analytics & optimization platforms, and others.

Covid-19 Impact on Smart Agriculture Market

Though the novel coronavirus pandemic had a devastating effect on several industries, the smart agriculture market experienced a favorable growth during this period. Agriculture in most of the countries are totally dependent upon the migrant labors and due to strict lockdowns and social distancing; labors are shifted to their places. Therefore, many farmers are adopting smart agriculture techniques such as precision farming to monitor the activities of crops. Therefore, the importance of smart agriculture techniques has skyrocketed, driving the growth of the market.

In addition to this, several companies are helping the society to recover from the chaotic situation with their strategic plans and steps. For instance, in August 2020, Deere & company, global leader in manufacturing of advanced agriculture products, announced that they are completely operational during the pandemic as many customers are operating in essential businesses of agriculture. Also, they are providing free phone consultation and delivery throughout the pandemic. The above-stated factors show that the pandemic may generate productive impact in the smart agriculture market in the coming years.

Increasing Prevalence of Modern Technologies in Agricultural Products to Surge the Market Growth

The global smart agriculture industry is witnessing a massive growth mainly due to an increase in the usage of digital screens and mobile phones to monitor the agricultural fields. Modern technologies such as artificial intelligence, robots, Internet of Things, location systems, and sensors are helping farmers to analyze the health of crops. This includes examination of irrigation schedules, average yield data, data security & management, and others, thereby driving the adoption of smart agriculture.

The emergence of smart agriculture industry is already leading market players to innovate strategies to help farmers. For example, in April 2019, Trimble, US based technical company, announced that they have launched Trimble Ag Software; this software helps farmers to connect their farm fields in all the aspects such as production, manufacturing, and monitoring of fields. Also, this software is easily available on any type of mobile phones and online. These types of initiatives from market leaders are also predicted to drive the growth of the market.

To know more about global smart agriculture market trends, drivers, get in touch with our analysts here.

High Cost of Smart Agriculture Equipment to Restrain the Market Growth

The smart agriculture equipment is costlier as an initial investment. Now-a-days tools such as LED lights, sensors, and smart tractors of smart agriculture are very expensive; therefore, they are non-affordable for farmers mostly in developing nations. The average cost of agricultural tractor is $22,000.00 and when it comes to smart tractor it is $40,000-50,000. Therefore, high cost may create a negative impact on the growth of the market during the forecast period.

Growing Trends of Livestock Monitoring Solutions in the Market to Create Massive Investment Opportunities

The global smart agriculture market is growing at a very fast pace due to rising technological adoption in livestock. Livestock smart technologies can collect data on stock location, and it can help farmers to monitor the livestock remotely with the help of IoT. This will help in detection of early diseases, easily recovery of stolen livestock, easily detection of movement or tampering of livestock and raise of productivity. Therefore, increasing demand for livestock tracking devices is expected to be a major growth accelerating factors of the smart agriculture, thereby positively affecting the market growth.

Furthermore, companies are focusing on different livestock monitoring devices to improve health of livestock and increase the yield. For example, Afimilk, Israel based global leader in computerized systems for dairy farm, launched cow monitoring solutions known as AfiCollar. It is a type of neck collar specially designed for cow monitoring that offers benefits such as accurate heat detection, eating time data, individual cow health alerts, 24/7 wireless detection & management, and digestion alerts. All such aspects may further lead to lucrative market opportunities for key players in the upcoming years.

To know more about global smart agriculture market trends, opportunities, get in touch with our analysts here.

Source: Research Dive Analysis

The precision agriculture sub-segment is predicted to have a dominating as well as fastest growing market share in the global market. The sub-segment is expected to register a revenue of $19,743.00 million during the forecast period. Precise farming is gaining popularity among the farmers for enhancing the productivity of farm and crop yield with the help of IoT in agriculture. Moreover, key players operating in the market are adopting strategic collaborations to offer best type of smart agriculture system and services to attract customers. For instance, Raven Industries, Inc., US based manufacturer of precision agriculture products, in November 2019 announced that they acquired Smart Ag Inc., a technology company. The main aim of this acquisition is to develop self-monitoring smart farming solutions for agriculture and become the industry leader. These factors and strategic alliances by key companies may bolster the growth of segment during the forecast period.

Source: Research Dive Analysis

The service sub-segment of the global smart agriculture market is projected to have the fastest growth. It is also projected to surpass $19,544.40million by 2028, with an increase from $9,061.50 million in 2020. This growth in the market can be attributed to rapid transformation of agriculture in service perspective. Service based smart agriculture allows farmers to increase the yields that can control every aspect of crop farming with the help of consulting, support and maintenance, system integration, and others. Moreover, new smart agriculture companies are offering services that will allow farmers to maximize yields. For example, CropX, an agriculture-based analytics company, launched adaptive irrigation software service, that offers the increment of crop harvest, cost saving for water & energy, and environmental conversation. All such elements may increase the demand for service based smart agriculture system, techniques and further surge the market growth.

The solution sub-segment of the global smart agriculture market is projected to have the dominant growth. It is also projected to surpass $30,244.50 million by 2028, with an increase from $14,613.30 million in 2020. This growth in the market can be associated with growing trends of smart agricultural hardware and software. This will include LED grow lights, valves & pumps, sensors, agriculture asset management, irrigation management, and others. Furthermore, certain players operating in smart agriculture market are adopting various strategies and innovations for staying upfront in the competitive environment. For instance, LumiGrow, industry leader in professional grade LED grow lights, in August 2019, announced that they launched LumiGrow TopLight, a type of lighting solution that will increase the quality of crop, yield, and efficiencies of production with the help of lights. All such additive may increase the demand for sub-segment and further surge the market growth.

Source: Research Dive Analysis

The Market for Smart Agriculture in North America to be the Most Dominant

The North America smart agriculture market accounted $10,923.50 million in 2020 and is projected to register a revenue of $22,804.20 million by 2028. The extensive growth of the North America smart agriculture market is mainly driven by higher disposable incomes with existence of top leading players augmenting the industry growth in the region. Moreover, the strong presence of leading smart agriculture providers and manufacturers that offer trending climate smart agriculture equipment is fueling the market growth across the globe. These factors might ultimately drive the demand in the smart agriculture market across the region.

The Market for Smart Agriculture in Asia-Pacific to be the Fastest Growing

The share of Asia-Pacific smart agriculture market is anticipated to grow at a CAGR of 10.10%, by registering a revenue of $14,396.90 million by 2028. The growth shall be a result of increasing demand for highly advanced agricultural drone in this region such as Australian UAV, Terra Drone, and Skylark Drone. Moreover, rising research and development spending from India and China is anticipated to contribute to the growth of Asia-Pacific smart agriculture market, in the upcoming years.

Competitive Scenario in the Global Smart Agriculture Market

Product launches and mergers & acquisitions are common strategies followed by major market players.

Source: Research Dive Analysis

Some of the leading smart agriculture market players are AgJunction, AGCO, AgEagle Aerial Systems, Inc., DEERE & COMPANY, Raven Industries, Inc., Trimble Inc., Afimilk, LumiGrow, Inc., Topcon Positioning Systems, Inc., and DeLaval.

Porter’s Five Forces Analysis for the Global Smart Agriculture Market Insights:

• Bargaining Power of Suppliers: The equipment and service suppliers of smart agriculture market are high in number and are larger and more globalized. So, there will be less threat from the suppliers.
  Thus, the bargaining power of suppliers is low. 
• Bargaining Power of Buyers: Buyers demand for effective smart agriculture technologies and solutions at low prices. This has increased the pressure on the smart agriculture providers to offer the best product and services in a cost-effective way. Thus, many suppliers are offering best yet cost effective smart agriculture technologies. This gives the buyers the option to freely choose smart agriculture technologies that best fits their preference.
  Thus, the bargaining power of the buyers is high. 
• Threat of New Entrants: Companies entering the smart agriculture market are adopting various innovations such as developing innovative products such as drones, sensors, and LED lights.
  Thus, the threat of the new entrants is moderate. 
• Threat of Substitutes: Different types of agriculture equipment and products are developed such as normal tractors, but they do not offer the kind of benefits that smart tractors provide.
  Thus, the threat of substitutes is low.
• Competitive Rivalry in the Market: The competitive rivalry among industry leaders is rather intense, especially between the global players including AGCO and DEERE & COMPANY. These companies are launching their value-added services in the international market and strengthening the footprint worldwide.
  Therefore, competitive rivalry in the market is high.