Farm Mechanization - ICFA · Indian Tractor Market Indian Council of Food and Agriculture Farm...
Transcript of Farm Mechanization - ICFA · Indian Tractor Market Indian Council of Food and Agriculture Farm...
FARM MECHANIZATION
Market Update
Farm Power Available
Farm Mechanization: Market UpdateIndian Council of Food and Agriculture
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Farm Power Available on Indian Farms; 2011-14
1.73
1.84
2.02
1.55
1.60
1.65
1.70
1.75
1.80
1.85
1.90
1.95
2.00
2.05
2011-12 2012-13 2013-14
Kw
/Ha
Source: Country presentation paper, Agricultural Machinery Manufacturers Association (AMMA) India, October 2014
Farm Power Available
Farm Mechanization: Market UpdateIndian Council of Food and Agriculture
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Farm Power Available on Indian Farms by Different Sources; 2011-14
13.3 13.5 13.620.1 20.1 19.8
118.2126.8
136.7
2.0 2.3 2.5
46.5 46.8 47.3
61.8 62.2 62.9
0
20
40
60
80
100
120
140
160
2011-12 2012-13 2013-14
Mil
lio
n K
w
Agricultural Workers Draft Animal Power Tractors
Power Tillers Diesel Engines Electric Motors
Source: Singh (2013); Singh et al. (2010); Singh et al. (2009)
Farm Power Available
Farm Mechanization: Market UpdateIndian Council of Food and Agriculture
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Extent of Farm Mechanization at Different Levels of Value Chain Process
40%
29%
34%
37%
65%
60%
71%
66%
63%
35%
0% 20% 40% 60% 80% 100%
Soil Working and Seed
Bed Preperation
Seeding and Planting
Plant Protection
Irrigation
Harvesting & Threshing
Mechanized (%) Non-Mechanized (%)
Source: UNESCAP CSAM
Indian Farm Mechanization Market
Farm Mechanization: Market UpdateIndian Council of Food and Agriculture
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Indian Farm Mechanization Market; 2015-20
320
338
358
378
400
300
320
340
360
380
400
420
2015-16 2016-17 2017-18 2018-19 2019-20
₹B
illi
on
Source: agrination.org.in
Indian Tractor Market
Farm Mechanization: Market UpdateIndian Council of Food and Agriculture
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Indian Tractor Market by Volume; 2011-17
544.43
608.58
591.50
697.68
626.84
571.25
500
550
600
650
700
750
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17
Th
ou
san
d U
nit
s
Source: Department of Agriculture and Cooperation, State of Indian Agriculture 2013-14, ICRA, A report on ‘Farm Mechanization in India’, TechSci Research
Indian Tractor Market
Farm Mechanization: Market UpdateIndian Council of Food and Agriculture
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Indian Tractor Market by Market Players; 2016-17
50%
18%
14%
10%
6%
2%Mahindra & Mahindra Ltd.
TAFE
VST
International Tractors Ltd.
Force Motors
Escorts
Source: Company Reports
Indian Power Tiller Market
Farm Mechanization: Market UpdateIndian Council of Food and Agriculture
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Indian Power Tiller Market by Volume; 2011-17
55 60
25
56
46 49
-
10
20
30
40
50
60
70
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17
Th
ou
san
d U
nit
s
Source: Department of Agriculture and Cooperation, A report on ‘Indian Tractor Industry’ by ICRA, TechSci Research, DAC - Dept. of Agriculture and Cooperation
Market Drivers
Farm Mechanization: Market UpdateIndian Council of Food and Agriculture
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Labor shortage is being experienced at peak seasons due to which labor is available
at a higher cost per hectare hence increased demand for mechanization.
The continuation and growth of contract farming with more entities getting
involved provides future opportunities for the expansion of the industry.
The government is promoting ‘balanced farm mechanization’ by providing
subsidy on various equipments and by supporting bulk buying through front-end
agencies.
The government also provides credit and financial assistance to support local
manufacturing of farm mechanization equipment.
The penetration of farm equipments is low with the small and marginal farmers
who own land less than 5 hectares. This segment forms over 80% of the land
holdings in the country. Thus, there is a lot of potential for increasing the penetration
and therefore growing the market size.
Rise in demand of Food Grains by 2030 to 355 MT
Market Challenges
Farm Mechanization: Market UpdateIndian Council of Food and Agriculture
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Small and Scattered Land Holdings
Tractorization is practiced rather than Mechanization
The entire process of acquiring farm equipment is very tedious and cumbersome for
a farmer.
An issue that has been persistent in financing is the purchase of standalone
implements.
Farm equipment, especially the energy-efficient options, is capital intensive and is a
major investment for most of the farmers in India.
The quality and after-sales service of farm equipment is another concern, since
agriculture is largely carried out in rural parts of India.
Recommendations
Farm Mechanization: Market UpdateIndian Council of Food and Agriculture
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Government can set up custom hiring centers which would facilitate hiring of
equipments by small and marginal farmers. It is further submitted that PPP model
should be employed for the purpose.
Farmers should be extended with financial assistance in the form of subsidy for the
purchase of agricultural equipments and should have the discretion to select the
quality machinery to be purchased with subsidy rather than it being pre decided vide
norms.
KVK along with corporate participation in PPP model may be utilized to increase
knowledge of farmers on the benefits of using latest farm machinery and to train
them for appropriate use of the machinery.
There is a need to develop customized farm machines and equipments with special
focus on small and marginal land holders. Therefore, dedicated funds are required to
promote research to come up with technology suitable to small and marginal
farmers.
Recommendations
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Awareness Campaign should be initiated to sensitize rural youth about available
employment opportunities and support provided by the government to promote
training of personnel.
After sale service, operational education and performance warranty for at least three
years should be inbuilt into the marketing and sale process to avoid hardship to
users. Government should intervene and have a regulatory mechanism to ensure
after sales services to farmers.
In order to expedite the process and conserve resources, it is suggested that imported
machinery, if approved by recognized agency need not be retested. Further, some
agencies involved in testing and approval of farm machinery worldwide can be
enlisted and recognized for the purpose.
Thank You