How is the Vietnam Agricultural Equipment Market Positioned?
Overview: Mechanization levels in Vietnam have increased considerably over the period 2014-2020. Soil preparation and harvesting for all the major cops in the country are more mechanized now compared to 2014. Mechanization levels are expected to incline further over the next few years and reach a benchmark level by the year 2030. Mekong Delta and Red River Delta are the most mechanized areas of the country as of 2020.
Vietnam imports majority of machinery and equipment for agriculture, mainly from China, Japan, and Korea. The competitiveness of domestic machines is also low because the cost is higher than imported products. Also, due to lack of solid basis in metallurgy, the domestic players are not able to provide the same quality as that of Japanese and Korean players.
Market: Market for agricultural machinery in Vietnam has enhanced by a CAGR of ~% over the period 2014-2020. Sales for new Combine Harvesters, Transplanters, Tractors and implements were recorded at ~ in Vietnam during 2020. Sales revenue amounted to VND~ million in 2020.
Increasing demand for food, reduction in post harvest losses, shortage of labour, extreme climatic conditions and signing of free trade agreement with various countries are the main reasons behind positive growth in agricultural machinery revenue. However, the agriculture in the country is constantly affected by drought and salt water intrusion which hampers the growth of this market.
Vietnam Agricultural Machinery Market Segmentation
By Product Type: Tractors market dominated the agricultural equipment industry in Vietnam in 2020 on the basis of value and volume. This is majorly due the fact that their use is not limited to agriculture and can be used for transport of agri-produce as well.
Tractor Market By Type: Majority of the market is dominated by 2 wheel tractors in terms of volume, majorly due to their low price. However 4 wheel tractors with lower HP are replacing the hand tractors.
Tractor Market By Power: The market for agricultural tractors has witnessed a gradual change over the period 2014-2020. Use of tractors 12 HP or below has declined over the period 2014-2020 while use of larger tractors has increased during this period. Tractors of power between 12 HP to 35 HP has accounted for the largest share.
By Region of Tractor Sales: Demand for 2W tractor was observed to be highest in Northern Midlands and Mountains. Red River Delta experienced decline in demand due to increasing fragmentation of land in the region which inhibits farmers to purchase new equipments.
Combine Harvester Market By Region: Mekong Delta has the highest number of Combine Harvester owing to higher land holding farm size. Other regions prefer to rent a combine harvester owing to its high price.
Rice Transplanter Market By Region: Mekong Delta has the highest number of Rice Transplanters owing to higher land holding farm size.
Implements Market By Type: Demand for tractor implements is complimentary to the sale of 2W & 4W tractors since majority of farmers procure implements along with tractors. Rotavator & Ploughs are the most preferred and demanded tractor implement as they help in seedbed preparation and ploughing of land.
Competition Scenario In Vietnam Agricultural Equipment Market
The Vietnam agricultural equipment market is concentrated among top 2 major manufacturers (Kubota and Yanmar) accounting for ~% of the sales volume for 4W Tractors, ~% of the sales volume for 2W Tractors, ~% for Combine Harvesters and ~% for Rice Transplanters in 2020. Both domestic as well as foreign companies have entered the market over the past five years to tap the potential in this sector. These players compete on parameters Product Portfolio, Distribution Network, Pricing, Discounts, and Geographical Location, value Added Services, Collaborations & Partnerships and After Sales Service.
Vietnam Agricultural Machinery Market Future Outlook and Projections
The agricultural machinery market in Vietnam is expected to grow at a CAGR of ~% on the basis of revenue and ~% on the basis of volume over the forecast period 2020-2025. However, the growth was slightly constrained in the year 2020due to the COVID-19 pandemic. This is likely to effect the growth in the year 2021 as well. Market has been anticipated to pick up from 2022 and growth significantly over the period 2022-2025. Companies are expected to focus on wider distribution network including expansion to northern midland and mountains and invest in research and development to come up with innovative products. The forecast period is also expected to witness collaboration or acquisitions among foreign and domestic players in the industry.
Key Segments Covered:-
By Product Type
Tractors (2W and 4W)
Combine Harvesters
Rice Transplanter
Implements
By Tractor Segment
Upto 12 Hp
Between 12-35 Hp
Above 35 Hp
By Region of Sales
Mekong Delta
Red River Delta
Northern Midlands and Mountains
North Central and Central Coast
Central Highlands
South East
By Implement Segment
Rotavator
Plough
Harrow
Fertilizer Spreaders
Others
Companies Covered:-
Kubota Vietnam
Yanmar Vietnam
VEAM (Vietnam Engine and Agricultural Machinery Corporation)
Thaco (LS Mtron)
Key Target Audience:-
Agricultural Equipment Companies
New Market Entrants- Domestic OEMs
New Market Entrants- Foreign OEMs
Agricultural Equipment Financing Companies
Government Bodies
Investors & Venture Capital Firms
Agricultural Equipment Manufacturers
Agricultural Equipment Distributors
Agricultural Equipment Associations
Time Period Captured in the Report:-
Historical Period – 2014-2020
Forecast Period – 2021-2025
For More Information on the research report, refer to below link:-
Vietnam Agricultural Machinery Market
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