1. Vietnam’s Agriculture Equipment market grew at a CAGR of 3.2% during 2014-2020 and is expected to rise more in the next five years.
Vietnam’s agricultural equipment market is in a growing stage. Increasing food demands, shortage of labor, climatic conditions, and government initiatives to help farmers by implementing several policies are some of the key reasons behind the growth of this sector in Vietnam. Moreover, experts have even predicted that the overall food demand is expected to rise in the range of 59% to 98% by 2050. To meet this demand, the agriculture sector in 2050 will need to produce almost 50% more food as compared to 2021. This will further induce the growth of Vietnam’s agriculture equipment market.
2. Presently, Vietnam’s agricultural machinery industry is highly import driven as there are not many manufacturers of agricultural machinery present in the country.
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Vietnamese government promotes the import of agricultural machines more as compared to domestic industry. The local manufacturers are almost small mechanical workshops and are not equipped with knowledge and skills in technical designs and manufacturing technologies. These manufacturers in Vietnam prefer importing raw materials and components from China as there is no duty on imports, hence the country is dependent on imports. In addition to this, domestic agricultural machineries are more expensive than its imported counterparts for about 15-20%. Currently, imports account for about 70-75% of the total value of the agricultural machinery market in Vietnam.
3. Tractors Dominate Mechanization, Insufficient Training and Lack of Awareness and Conversion to Non-Agricultural Land are some of the major challenges of the agriculture equipment sector in Vietnam.
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The market is poised to grow in the coming years. Still, there remains some obstacle that hinders the growth of this industry. One of the key issues is that tractors dominate the farm equipment market and other types of equipment have a very low market share. This is due to the lack of knowledge about the benefits of using additional equipment and practices. It is because the training and the events that are conducted to increase awareness on farm mechanization are not enough in the country. Besides it, the rice land in Vietnam is being converted into non-agricultural land for the purpose of urbanization and tourism development. This poses a threat to farm machinery as rice is the major crop sown in Vietnam.
For more insights on the market intelligence, refer to the link below:-
Vietnam Agricultural Equipment Market
