Smart farming is a farm management concept that focuses on providing the agricultural industry with the infrastructure to use advanced technologies - including big data, cloud, and Internet of Things (IoT) - to track, monitor, automate and analyze operations. Smart farming, also known as precision farming, is software-controlled and sensor-monitored. Smart farming is gaining importance due to the combination of the growing world population, increasing demand for higher crop yields, the need to use natural resources efficiently, the increasing use and sophistication of information and communication technology, and the increasing need for climate-friendly agriculture .
The global smart farming market was valued at $15.06 billion in 2022 and is expected to reach $33.0 billion in 2027, following a CAGR of 16.99% during 2022-2027. The growth in the global smart farming market is expected to be driven by increase in adoption of IoT and artificial intelligence, digitalization of agriculture operations, rise in dependence on advanced technologies to enhance production across the globe.
Impact of COVID-19 on Smart Farming
Due to the COVID-19 pandemic, the research & development has slowed down owing to the lack of funding, halt manufacturing activities, and components or raw material supply chain disruptions. In addition, positive impact of COVID-19 had been seen on smart farming technologies adoption such as autonomous vehicles, robots, software solutions, and sensors by farmers owing to lack of workers which is resulted in increase in demand for smart farming solutions worldwide.
Smart Farming Market by Applications
The smart farming market by application is majorly driven by precision agriculture applications, including precision irrigation, yield monitoring and forecasting, variable rate application, crop scouting, and record keeping, among others. This is followed by livestock monitoring and management applications. As the global population increases exponentially, the total supply of food must be increased; otherwise, food shortage could lead to serious socio-political issues. Precision agriculture methods help significantly increase agriculture efficiency, which would significantly impact overall production yield. Increased yield applying the same number of resources will help tackle food security issues and reduce waste during production.
Smart Farming Market by Region
North America is the leading region in agricultural technologies in terms of market adoption and development. North American countries are far ahead of the different regions, looking to implement various digital technologies beyond conventional farm machinery and services for efficient crop production. Smart farming is gradually transforming the global agricultural industry by making farming practices more sustainable and profitable. While the introduction of newer technologies has been on the rise to meet the growing food demand, North America has been one of the early adopters of the same. Moreover, it serves as one of the most important regions for the smart farming industry as leading original equipment manufacturers (OEMs) generate their major share of the revenue from this region. With the rise in urban population and an all-year-round demand for agricultural produce, indoor farming is massively adopted in the region to meet the requirement. Henceforth, the region has also been a major contributor to the indoor farming segment of the market.
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Competitive Landscape
The competitive landscape for the smart farming market demonstrates an inclination toward companies adopting strategies such as product launch and development and business expansions and contracts. The major established players in the market are focusing on product launches and developments to introduce new technologies or develop their existing product portfolios. Deere and Co., Hexagon Agriculture, AGCO Corporation, CNH Industrial, GEA Farm Technologies, Trimble, Inc., CropX, Inc., BASF SE, Connecterra BV, Signify Holding NV, Osram Licht AG, Naio Technologies, and AKVA Group are some of the prominent players in the smart farming market.
The global smart farming market has a huge potential, and it is also positively impacted by a positive outlook toward digitization. However, the market currently needs inter-organizational collaboration as well as involving farmers in the development process so that products and solutions can be designed and developed to address the challenges being faced by the farmers and the industry. Hence, a rise in awareness among farmers and efforts from the government and private sector toward the development of sustainable agriculture is expected to drive the growth of the global smart farming market during the forecast period.
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