Agricultural tires market is estimated to be valued at US$ 6.32 Billion in 2024, exhibiting a CAGR of 5.4% over the forecast period 2024-2031. Agricultural machinery production and sales have witnessed significant growth over the past few years due to increasing mechanization in the agriculture sector. Furthermore, growing demand for high performance farm equipment is expected to drive market growth during the forecast period.
Market Dynamics:
Increasing mechanization in the agriculture sector has boosted demand for agricultural machinery over the past few years. Various factors such as rising labour costs, shortage of agricultural workforce, and need to improve farm productivity are compelling farmers to resort to agricultural mechanization. This boosts sales of agricultural equipment with high quality tires. Growing demand for high performance farm machinery that can withstand heavy loads and operate in challenging field conditions is another key driver propelling the growth of agricultural tires market. Radial tires are increasingly being adopted owing to benefits such as reduced slippage, better traction, higher load capacity, and longer lifespan.
Market Drivers
Growing Demand for Higher Crop Yield and Mechanization of Farming Processes
One of the key drivers of agricultural tires market is growing demand for higher crop yields. With rising global population, there is increasing pressure on farmers to produce more food and other agricultural commodities. Agricultural tires help improve productivity and efficiency of farming equipment like tractors. Tires with advanced tread patterns and materials provide better traction which allows tractors and other machinery to work faster in fields. This helps farmers cover larger acreage and harvest higher volumes. Moreover, mechanization of farming processes has increased significantly over the past few decades with more and more smallholding farmers relying on tractor services. This rise in mechanized agricultural activities is a major driver boosting demand for agricultural tires.
Increasing Ownership of Agricultural Equipment like Tractors
Another major driver is increasing ownership of agricultural equipment like tractors, globally. Tractors are indispensable for various agricultural operations like ploughing, harrowing, transporting goods and spreading fertilizers. As economies develop and farm sizes increase, more smallholder farmers are also investing in their own tractors instead of relying on contractor services. The growth in the global tractor market directly impacts the sales volume of agricultural tires. Advanced economies with large agricultural sectors and developing nations experiencing a rise in farm mechanization are witnessing high demand growth. The growing ownership of implements like harvesters, tillers and trailers further boosts demand for agricultural tires.
Market Restraints
Fluctuating Raw Material Prices
One key restraint of the market is the fluctuating prices of raw materials used in tire manufacturing like natural and synthetic rubber, chemicals, steel cord and fabric. Agricultural tires utilize large volumes of natural rubber which is subject to supply uncertainties and price volatility influenced by factors like weather conditions. Raw material costs contribute significantly to the overall tire production cost. Any increase is usually passed on to customers by manufacturers, which can impact demand especially during unstable economic conditions. Additionally, international trade policies and tariffs also influence raw material supply and pricing. Volatile input prices make operations and pricing challenges for agricultural tire manufacturers.
Fragmented Dealer and Distribution Network
Another restraint is the fragmented nature of the dealer and distribution network for agricultural equipment and supplies in developing markets. While a few global players dominate developed economies, regional and local players have a strong presence across Asia Pacific and Africa. The lack of standardization makes it difficult for international tire brands to efficiently supply and service a widely scattered customer base in rural areas. It also provides more bargaining power to the fragmented dealer channels, influencing sales terms and margins negatively. Manufacturers have to invest heavily in expanding and integrating the distribution infrastructure to counter this restraint in high growth potential markets.
Market Opportunities
Emergence of Precision Farming Technologies
Emergence and increasing adoption of precision farming technologies globally can provide opportunities for the market growth. Advanced precision farming involves utilizing solutions based on Big Data analysis, IoT devices, GPS, GIS and VRT (Variable Rate Technology) to optimize resources like water, fertilizers, seeds and agrochemicals. This supports higher yields, cost savings and sustainability. Precision agriculture equipment requires specialized tires capable of holding sensors and working accurately in varied soil conditions. It opens up opportunities for tire makers to develop new products, catering to precision farming vehicles like drones, specialized autonomous tractors and crop monitoring machinery.
Growth in Organic Farming and Conservation Agriculture
Fast growth of organic and conservation farming practices worldwide due to rising health and environmental concerns can provide opportunities for the market growth. Organic farming prohibits chemical pesticides and fertilizers, relying more on natural methods. Conservation agriculture minimizes soil disturbance through practices like no-till farming. Specialized tires suitable for these methods can offer better traction and minimal soil compaction. These help machinery to perform efficiently under the unique requirements of organic and conservation agriculture. This emerging trend presents an opportunity for tire manufacturers to develop differentiated products addressing the needs of this fast growing segment.
*Link: https://www.coherentmarketinsights.com/market-insight/agricultural-tires-market-5302
Key Developments:
- In April 2024, Hercules Tire and Rubber Company (HTR), a subsidiary of American Tire Distributors (ATD), launched the AG-TRAC F-2, a durable tire engineered to deliver top-notch performance across various farm surfaces. Available in two crucial 16″ sizes for 2WD Front Tractor wheel positions, this tire offers the necessary flotation, durability, and responsive steering for seamless operation in diverse agricultural environments.
- In March 2024,Bridgestone Americas (Bridgestone) introduced an enhanced Regency Plus bias tire lineup for Firestone Ag. Providing a wide range of cost-effective options for different applications, including fronts and implements, as well as solutions tailored for utility, light construction, and lawn and garden equipment, the Regency Plus bias tire aims to assist farmers in maximizing their crop yield.
- In February 2023, Continental AG, a renowned automobile supplier and manufacturer, launched the VF TractorMaster in size VF900/60R42, marking its largest tractor tire till date with a diameter of 2,147 millimeters. Weighing 450 kilograms with a load index of 189 (10,300 kilograms), this tire surpasses the dimensions of a standard door frame.
Key Market Players
Key companies covered as a part of this study include Alliance Tire Group, Trelleborg AB, Balkrishna Industries Ltd., Michelin, Bridgestone Corporation, MRF Tyres Limited, Yokohama Rubber Co., Ltd., Titan International, Inc., Cheng Shin Rubber Ind. Co., Ltd. , Mitas, as, Deestone Tire & Rubber Co., Ltd., Galaxy Tire & Wheel Ltd., Sun Tyre Group Co., Ltd., Triangle Tyre Co., Ltd., ZC Rubber (SH) Co., Ltd., petlas, Greenland Tyre Co., Ltd., Trelleborg Wheel Systems Americas, Inc., Camoplast, Hinrichs Gummiwerke GmbH are the major players.
