Agriculture Tires Market
Global Industry Analysis (2017 – 2020) – Growth Trends and Market Forecast (2021 – 2027)
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Advent of Agricultural Equipment and Expanding Application Base Push Agriculture Tire Sales
With the consistent rise in demand for high and superior agricultural yield to cater to expanding population worldwide, there has been a spike in demand for highly productive and efficient agricultural machinery as well. While this fuels the demand for agriculture tires, it is further upheld by the technological advances in agricultural methods and equipment. Agriculture tires specifically have deep tread designs for tractors, and other agricultural vehicles with an intent to provide more traction during off-road activities or on non-paved roadways like sand, mud, dirt, or gravel.
Unlike winter tires, agriculture tires are not embedded with studs but are designed with wider grooves enabling them to sink in the mud or gravel for better traction. The global agriculture tires market has progressed at a rapid pace over the past decade. Increased utility in multiple end-use categories such as mining, construction, and farming provides constructive opportunities for the market growth. The increasing application base of agriculture tires will drive their market in the foreseeable future.
Increasing Rate of Technology Adoption in Developed Nations Boosts Market Growth
Adoption of advanced technology tires in the agricultural sector has been rising at a promising rate compared with the construction and mining industries. Increased off-road activities, growing consumer spending capacity in developed and developing nations supplemented by the launch of special agricultural vehicles in the recent past has considerably bolstered the agriculture tire demand. The rate of technological adoption is significantly higher in European countries with limited manpower, conducive cultivation environment, and wide availability of arable land. The technological advancement in the region is further supported by higher per capita income of farmers. As a result, farmers with lesser labour availability rely on high-end technologies to boost production and revenues. Higher labour wages in developed nations also limit the farmers’ spending over petty jobs in large grasslands and agriculture fields, and such jobs are being accomplished with mechanized systems, integrated into tractors and harvesters that entail in reducing human errors and efforts.
Modern agricultural vehicles are capable of performing a multitude of activities such as sowing, fertilization, and harvesting as well. The desire to mechanize agricultural activities was the need of the hour with limited labour shortages or high labour overheads with fluctuation in availability. The deployment of advanced technologies is justified with the usage of equally good agriculture tires to support the agriculture vehicles. Of late, developing economies are also witnessing an increasing tendency to shell out money on modern agricultural activities, creating a fertile ground for the growth of agriculture tires market.
COVID-19 Impact Adds to Fluctuations in Tire Industry
The pandemic situation and following lockdowns caused immense disruption and pressure on the entire value chain of tire industry. While mainstream raw material suppliers were anxious due to domestic and international ban on transportation and logistics, manufacturers faced the wrath of zero production amid the complete lockdown. As a result, operating profits were squeezed and daily overheads swelled, leading to massive financial pressure on manufacturers, eventually affecting final deliveries.
Although the demand is showing signs of revival, fluctuations prevail. Nevertheless, agricultural activities have retained the market momentum despite dreadful impact of the pandemic. All these factors ultimately account for the uncertainties in tire industry. Potential operational advantages such as receiving real time-data from tires for better vehicle manoeuvring, and deploying nanotechnology for enhanced performance are likely to present new windows of opportunities to market players for proliferation.
Biased Tires Retain Momentum on Back of Competitive Prices and Eco-Friendly Attributes
Biased tires, manufactured from natural rubber, continue to sustain preference across Asian markets such as China and India. Lower costs of manufacturing and superior flexibility are likely to account for the growing popularity of these tires in future. However, declining availability of natural rubber will most likely constrain the demand in long run, working to the advantage of radial tires that are more durable and flexible owing to their synthetic contents and steel ply manufacturing base. Burgeoning demand for OE and aftermarket sales on the back of rising spending capacity of the population in the developing countries has bolstered the market growth and is likely to continue in the foreseeable future.
Asia Pacific Creates a High-potential Playing Ground for Agriculture Tire Manufacturers
Asia Pacific is turning out to be one of the leading regions due to the rising demand, especially from the agricultural sector of China and India, coupled with the advent of manufacturing activities. Moreover, developments in farming technologies and supportive policies are anticipated to fuel the growth of agricultural industry, thereby boosting agriculture tire demand. A few manufacturers have established their manufacturing bases in Asian economies with a due consideration of low labour cost, easier raw material availability, conducive government policies, and rising demand for food production in the region. These factors will provide the necessary thrust to the agriculture tires market.
Competition Landscape of Agriculture Tire Market Remains Consolidated
Key manufacturers in the market are reliant on the growth of end-use industries and new product developments. Manufacturers are consistently focussing on new tread designs that are durable and highly reliable in terms of performance standards by using advanced engineering techniques. The market is highly consolidated, steered by a few large players, including Yokohama Rubber Co., Ltd., Continental AG, Trelleborg AB, Balkrishna Industries Limited, and Pirelli & C. S.p.A., that control a majority of the stake. Besides, there are other prominent players such as Bridgestone Corporation, Sumitomo Rubber Industries Ltd., Goodyear Tire & Rubber Company, Compagnie Générale des Établissements Michelin (CGEM), Titan Tire Corporation, and Prometeon Tyre Group S.r.l. Many companies are entering join ventures along with revisiting their pricing strategies. In an effort to extend the existing client base and establish a strong brand value, many companies are emphasizing value addition to aftersales.