Latin America Precision Agriculture Market Research Report: Forecast (2023-2028)

Market Definition

Precision Agriculture or Precision Farming is a concept of farm management based on observing, measuring, and responding to inter and intra-field changing variability of the crops. It is a management strategy that gathers, processes, and analyzes temporal, spatial, and individual data and combines it with other information to support management decisions following estimated variability for improved resource efficiency, productivity, quality, profitability, and sustainability of agricultural production. It uses information technology to ensure that the crops and soil receive what they need for optimum health and productivity.

Market Insights

The Latin America Precision Agriculture Market is projected to grow at a CAGR of around 12% during the forecast period, i.e., 2023-28. Latin America has been associated with producing and exporting diverse agricultural crops and products like coffee from Brazil and Colombia, beef from Argentina, and bananas from Ecuador. Therefore, the increased agricultural production calls for enhancement in the farming technique and infrastructure to ensure maximum output and utilization of numerous resources, extending the need for precision agriculture. In view of this,

• In July 2021, AGCO Corporation launched the pilot model of the Precision Ag Line (PAL) program, a tool designed to streamline support services for farmers using AGCO’s solution with mixed-fleet operations.

The market growth is favorably fostered by the burgeoning need for advanced farming techniques and concepts to keep up with Latin America's rising food demands leading to constant upgrades in traditional farming methods. Besides, precision farming allows farmers to manage large stretches of land as a group of small fields, increasing crop efficiency and decreasing the errors in product application.

Furthermore, the integration of remote sensors, telematics, autonomous vehicles, GPS soil sampling, drones and robotics into numerous aspects of farming has opened plentiful lucrative opportunities for market extension. However, the high cost and added expenses for farmers in shifting to precision farming methods could hamper the market.

Market Dynamics

Key Driver: Rising Popularity of Technology in Farming and Decreasing Agricultural Land

The popularity of numerous benefits and upgrades in agricultural processes through technology has primarily driven the market. Additionally, with decreasing agricultural land with spreading infrastructural changes in Latin America, technology allowing a quality production of crops and food has been furthering the industrial value. Moreover, the rapid boost in population and ever-increasing food demands are extending the need and adoption of technologically upgraded farming habits. Several advantages, such as increased productivity and decreased labor costs, are fueling the market ascension.

Possible Restraint: High Cost and Added Expenses for Farmers

The high cost and other added expenses associated with precision farming could hamper the market. The technology and devices used in precision agriculture are highly advanced in technology and expensive in price, such as smart sensors, GPS, VRT, guidance tools, and receivers. Moreover, the requirement of experienced personnel to operate and understand the complicated system and calculations could further impede the market acceleration. The need for high investment restrains the adoption of precision farming in numerous developing countries, which follow traditional farming concepts instead.

Growth Opportunity: Integration of Artificial Intelligence (AI) in Precision Farming

The continuous integration of modern information and communication technologies (ICT) followed by Artificial Intelligence (AI) into numerous aspects of precision farming has opened new avenues for the farmers and tech-enabled service providers. For instance, AI is used in weather forecasting to assist farmers in deciding the most beneficial crop to cultivate while monitoring and evaluating the quality and nutrition level of the soil. In addition, AI can help provide information or guidance about using fertilizers, water management, crop rotation, pest control, optimum planting, and more.

Moreover, AI also helps in pest control by using satellite imagery and comparing it with historical data to check if the insect has landed on the crops and the type of the insect. High-quality monitoring and harvest through AI tools opens enumerative opportunities and add to the industrial expansion.

• In September 2022, Trimble Inc. acquired Bilberry, a selective spraying technology system for the sustainable farming company based in France, allowing Trimble Inc. access to Bilberry’s artificial intelligence (AI) technology that identifies a wide variety of weed species in real time for a broad range of crop types. 

Key Trend: Surging Demand for Smartphones for Monitoring and Other Applications

The rising adoption of smartphones among farmers to have easy access to their farm's data and information has been increasing the value of the market. Besides, companies are introducing new advanced applications compatible with smartphones to help farmers monitor the field from any location, and the option of cloud backup directly through smartphone integration is adding to the market ascension. Furthermore, as smartphones fulfill the different requirements of farmers by supporting connectivity using Bluetooth, USB, and Wi-Fi, they create further opportunities for the industry and surge in smartphone adoption. Thus, easy access to farm data and added features like monitoring and using the phone as a remote control for specific functions are further fueling the industrial expansion.

Market Segmentation

By Offering,

• Hardware
  • Automation and Control System
    • GPS/GNSS System
    • Guidance and Steering System
    • Flow and Application Rate Control Solutions
    • Handheld Computers/ Mobile devices
    • Agriculture Cameras
    • Others
  • Sensing and Monitoring
    • Yield Monitors
    • Sensing Systems
    • Other Hardware
• Software
• Services
  • Integration and Deployment
  • Maintenance and Repair
  • Other Services

Among all, Hardware dominated the industry during the historical period and is expected to garner the greatest revenue share in the forecast period. The segment is primarily driven by the requirement for numerous devices for precision farming, such as sensing devices, drones, control systems, etc. Furthermore, automation, GPS receivers, guidance and steering devices, and variable-rate technology (VRT) devices further benefit the agricultural goal for healthy produce and precision farming’s purpose of monitoring and maintaining fields and crops, extending the industrial expansion.

Moreover, the trending adoption of automation and control devices such as drones, irrigation controllers, guidance and steering systems, yield monitors, and sensors is adding to the market value of the precision agriculture market.

On the other hand, the software is also expected to experience considerable growth due to the implementation and adoption of numerous web-based and cloud-based software, such as predictive analytics software, to guide crop rotation, soil management, ideal planting seasons, and harvesting timings.

• In February 2022, Deere and Company opened a developmental facility in Austin, US focusing on developing software used in autonomous tractors that helps tractors use data from the cloud and GPS signals to take a precise and specific path. 

By Application

• Precision Irrigation
• Yield Monitoring
• Precision Spraying
• Precision Fertilization
• Precision Planting
• Data Management

Here, Yield Monitoring held the largest market share during the historical period. The need for climate service initiatives enabling farmers to deal with climate-related disasters effectively is pushing market acceleration. Besides, the benefits of improving food security and helping make decisions for the farm add to the application of yield monitoring. Farmers can get real-time data during harvest by implementing yield monitoring and developing a historical-geographical database to benefit the farm. Moreover, equitable landlord negotiations, proof of environmental compliance, and track records for food safety further add to the industrial expansion.

Recent Developments in the Market

• In February 2022, Trimble Inc. launched its Virtual Farm, an interactive online experience for farmers across the world to immerse themselves in precision agriculture by having users walk through a digital farm and identify common challenges they encounter daily.
• In May 2021, AGCO Corporation collaborated with Raven and other brands to evaluate spraying technology to increase the effectiveness and efficiency of crop protection product applications.

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