Smart Agriculture Market Report Scope & Overview:

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The Smart Agriculture Market size was valued at USD 16.1 Billion in 2023 and is expected to grow to USD 36.73 Billion by 2032 and grow at a CAGR of 9.6 % over the forecast period of 2024-2032.

Agriculture is facing intense pressure. The FAO predicts that a 70% increase in food production will be needed by 2050 to feed a population of 9.1 billion, as the climate crisis continues to impact supply chains. This is the point where advanced agricultural practices, utilizing technologies such as AI, become involved. The demand for higher productivity and efficiency in a shifting climate is fueling this growth. AI assists farmers in forecasting weather patterns several months ahead, enabling them to prepare for unforeseeable weather conditions. It also assesses the health of the soil, an essential yet slowly renewing asset, guaranteeing sustainability in the long run. With one-third of the planet's soil already deteriorating, the importance of AI in soil management is increasingly vital. Climate change is not only a concern for the environment, but also a chance for business growth. Public-private partnerships are essential for expanding Smart Agriculture solutions, not only for ensuring food security, but also for seizing the USD 1 trillion climate adaptation opportunity across various sectors. By embracing AI-driven technologies, businesses in the food and beverage industry can enhance supply chain resilience and reduce greenhouse gas emissions, benefiting both their bottom line and the environment.

Africa, holding 36% of arable land worldwide, experiences both food insecurity and the effects of climate change. Immediate action is required due to the agri-food sector's significant role in contributing one-third of global emissions. Climate-Smart Agriculture (CSA) is seen as a solution, with the goal of increasing productivity, enhancing climate resilience, and cutting emissions. The Smart Agriculture market worldwide is ready for substantial expansion, propelled by technologies that tackle these obstacles. As the industry progresses, sustainable agriculture relies on advancements such as solar energy, as demonstrated through LONGi's involvement in the China-Africa-UN High-Level Dialogue. It is anticipated that the Smart Agriculture industry will reach USD 25.4 billion by the year 2028 due to the increasing focus on technologies that align with CSA's objectives of enhancing food security, addressing climate change, and minimizing environmental harm.

Market Dynamics

Drivers

Decreasing Price of Solar Energy Drives Adoption of Smart Agriculture Technologies

Technological advancements have significantly reduced the cost of solar power, making it a major market driver for the Smart Agriculture industry. Solar energy is now significantly more affordable and clean with a 90% decrease in Levelized Cost of Electricity (LCOE) from ten cents to just one to two cents per kilowatt-hour in areas like Africa. This economic benefit drives the incorporation of solar technology into farming methods, allowing farmers to embrace smart agricultural solutions. LONGi's Hi-MO 9 module emphasizes the advancement in solar technology, with an efficiency of 24.4% and a 6.5-8% increase in power generation on the same land area, solidifying its status as a practical and appealing choice for powering agricultural activities. The decrease in costs, along with rising energy needs in the agricultural sector, is speeding up the acceptance of smart agricultural technologies. This is fueling the expansion of the Smart Agriculture industry, forecasted to hit USD 25.4 billion by 2028.

Transformation of smallholder farming into digital form.

The use of smart, digital, and precision agricultural technologies is a crucial factor driving the Smart Agriculture industry. In low-income countries, the majority of the world's half-billion farms are less than two hectares in size, presenting a huge opportunity for technology-driven growth with over 80% prevalence. Despite their small size, these small farms make a significant contribution to global food production, making up 80% of the food supply in Asia and sub-Saharan Africa. The productivity of these farms can be greatly improved by using technologies such as mobile apps, sensors, drones, and digital platforms to fill information gaps and optimize efficiencies. Although big farms in wealthy nations have already seen the advantages of these advancements, there is enormous potential to transform small-scale farming in developing countries. This factor in the market is essential for promoting sustainable agriculture, enhancing well-being, and supporting the overall objective of attaining the Sustainable Development Goals (SDGs) by 2030.

Restraints

Climate Change and Deforestation are worsening Agricultural difficulties.

The growing climate crisis presents a major obstacle for Smart Agriculture in at-risk areas such as Madagascar. Severe weather occurrences, like droughts and cyclones, disturb agricultural production, livelihoods, and food security. Farmers contribute to the worsening of climate change by turning to deforestation in order to increase their land, creating a harmful cycle. The interaction of climate change and deforestation obstructs the implementation of sustainable farming practices and reduces the impact of innovative agriculture solutions. Nearly 1/3 of Madagascar's population experiencing food insecurity highlights the urgent requirement for resilient and adaptive agricultural tactics, making the challenge more evident. Despite some progress shown by initiatives from Conservation International and the UN Green Climate Fund, it is essential to widely adopt climate-Smart Agriculture to address this market barrier and guarantee food security in the midst of a changing climate.

Challenges in Smart Agriculture due to the Digital Divide and Infrastructure Issues

The main obstacle for Smart Agriculture in developing countries is the noticeable lack of connectivity and infrastructure in rural areas. Small-scale farmers encounter various obstacles when it comes to embracing digital technologies, such as lack of digital skills, inconsistent internet access, and expensive equipment and services. The adoption of data-driven insights is often hindered by the complexity of data management and analysis, which typically necessitates specialized knowledge. Furthermore, the conventional agricultural supply chain, known for its lack of standardization and reliance on physical markets, presents challenges for incorporating e-commerce. The lack of necessary infrastructure such as roads, warehouses, and transportation systems in various areas worsens these issues, restricting the effectiveness of digital solutions and disrupting the efficient transportation of agricultural goods to markets. The convergence of these factors results in a challenging landscape that hinders the extensive implementation of smart agricultural technologies and hampers the growth of the industry.

Segment Analysis

By Offering

Offering-wise, Software was the dominant force in the Smart Agriculture market, boasting a substantial 56% share in 2023. The reason for this supremacy lies in the fact that smart farming is driven by data. Picture a farmer using software as a digital compass to steer them through key decisions. Farm management software serves as a guide by gathering and evaluating information from sensors, drones, and various other sources. This information enables farmers to make accurate decisions, from planting and irrigation to pest management. The growth of IoT devices and sensors in farming has also boosted the software industry. These sensors function as virtual vision and hearing organs, consistently producing information that must be gathered and analyzed. Farm management software converts raw data into useful insights, allowing farmers to closely oversee and manage all aspects of their operations. Basically, software acts as the intelligence behind the smart farming evolution.

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By Application

Based on Application , Precision Farming  dominated the Smart Agriculture market with 42% of share in 2023. This superiority stems from its capacity to convert conventional agriculture into an efficient and fruitful process. Picture a farmer carefully adjusting their methods for every part of their field, much like a talented artist sculpting a work of art. Precision farming enables farmers to optimize water, fertilizers, and pesticides usage with surgical precision, allowing them to do exactly that. Major reductions in expenses, heightened profitability, and increased crop production. By applying fertilizers only in areas where necessary, farmers can minimize waste and environmental harm while enhancing crop well-being. Precision farming goes beyond technology; it is a strategic method to optimize yield with scarce resources. As the global population continues to rise and the need for more food increases, precision farming is becoming increasingly important for guaranteeing food security and sustainability.

By Regional Analysis

North America dominated the Smart Agriculture market with 36% of share in 2023. The strong agricultural industry in this area, combined with a keen interest in technological advancement, has established a supportive environment for innovative farming solutions. John Deere and Trimble are leading the way by providing cutting-edge equipment and software to enhance farm operations. The emphasis on sustainability and efficiency, motivated by environmental issues, is in line with the objectives of smart farming. Government actions and large investments in agri-tech continue to boost market expansion. As the world faces increasing food demands, North America's implementation of smart agricultural techniques sets an example for other areas to emulate.

Asia Pacific is the second largest fastest growing region with 26% of share in 2023. The Asia Pacific region is undergoing a swift agricultural evolution supported by advanced technologies such as variable rate technology, intelligent irrigation systems, and AI-driven analytics. This rapid advancement in technology is supported by a thriving livestock and aquaculture sector, requiring automation and intelligent farming solutions. The increasing population in the region, especially in countries such as China and India, is leading to higher meat consumption, which is driving market growth even more. An example of this is the significant increase in cattle populations in China by 3% and in India by 0.4% in 2022, highlighting the growing need for livestock items. Asia Pacific is establishing itself as a top player in smart agriculture, balancing feeding its increasing population with sustainable methods in a dynamic landscape.

Key Players:

The major players are Grownetics, Inc., Deere & Company, CropMetrics LLC, Argus Control Systems Ltd, AGCO Corporation, Ag Leader Technology, AgJunction, Inc., CropZilla, Inc., DICKEY-john, AgEagle Aerial Systems Inc., Autonomous Solutions, Inc., BouMatic Robotic B.V., CLAAS KGaA mbH, DroneDeploy, Farmers Edge, Inc., DeLaval Inc, Granular, Inc., Trimble Inc., Gamaya, GEA Group Aktiengesellschaft, Raven Industries, Inc., and others.

Recent development

• Trimble Inc. will release two screens for precision agriculture Farm Sizes, the GFX-1060 and GFX-1260, in October 2022. Farmers can carry out in-field chores quickly and effectively with these next-generation monitors, which allow them to precisely map and monitor field data in real-time.

• Patriot made the next step forward in spray technology and communication in Australia in February 2022. For more than two decades, the Case, IH Patriot sprayer has been a mainstay in many farming operations. The newest Case IH Farm Size technology, the new Patriot 50 series, is going to be presented to Australian clients.

• In January 2022, new Hexagon technology provided accuracy in excavator planting. The launch of HxGN AgrOn Planting Assistant is aimed squarely at the forest market. It can, however, be customized to improve operations on other crop Agriculture Type s such as palm oil, citrus, and coffee.

• In September 2022, John Deere launched three new Deere-powered self-propelled forage harvesters (9500, 9600, and 9700) to its lineup. Each model addresses the needs of contractors, customer harvesters, and dairy & livestock producers challenged by increased operating costs, shorter harvesting windows, and a smaller pool of skilled workers.

• In April 2021, Topcon Agriculture launched the new AGM-1 and AGS-2 manual guidance & autosteering receivers and the new Topnet Live cellular, satellite & bridging correction services: Realpoint, Starpoint, and Skybridge. These technologies are used in machine operations and all associated tasks including soil preparation, seeding, crop care & harvesting, where tracking location data is relevant to crop optimization