In September 2016, INTA agronomists Mario Bragachini and Fernando Ustarroz published "The added value of Farm Machinery and Equipment Parts of Argentina. Internal Market and Export" It provides an interesting vision about this key sector for the Argentine economy and the agricultural and agro industrial development. These are some indicators to realize the relevant of this value chain (between 2015 and 2016):
a) The Argentine farm machinery sector comprises 600 terminals and 260 equipment part industrials, which makes 860 small and medium enterprises (SMEs) that directly and indirectly generate about 80,000 jobs. This remarkable amount of human resources is distributed geographically in the following way: 43% in Santa Fe, 32% Córdoba, 18% Buenos Aires and 7% in other provinces.
b) Argentina is the second country in the world to adopt Precision Agriculture after USA.
c) Argentina has more than 20 companies that provide the global market with electronics and software to transform local agricultural machines into intelligent, self-guided, self-regulating and hyper-connected with the web cloud and databases that process information and allow machines to improve their performance.
d) This sector exports to more than 50 countries. The main destinations are: Bolivia, Uruguay, South Africa, Kazakhstan, Venezuela, Brazil, Italy, Russia, Paraguay, Ukraine, Guatemala, Australia, Mozambique, Namibia, Romania, others. In addition, Argentina sells plastics for silo bag to 50 countries.
e) 85% of the equipment and technological tools that our country demands are manufactured in Argentina. It is the only country in Latin America with such a level of autonomy in this sense. According to INTA experts, this is an achievement of the Public-Private Partnership Network, which is also composed of national companies, the State and multinational companies.
f) Argentina has 20 companies that manufacture efficient and competitive technological tools for agriculture and livestock precision, which gives the Argentine Agricultural Machinery (MAA) sector a great global competitiveness. Argentina in recent years exports slightly more than 20% of local turnover and generates 12.000 jobs.
Farm machinery exports for 2015-2016
What can happen to the sector by the year 2025?
1- Global food demand could grow 50% by 2050.
2- We could witness a rise in demand for biomass from the renewable energy industries to be used by farm machinery and equipment, given that a rise in efficiency and emissions control in machinery is expected.
3- Climate change will be a determining factor as machinery must be able to operate under future weather conditions.
4- There will be more demand from producers for automatization in machinery that allows for a reduced workforce.
5- Machinery and equipment shall be lighter in the future, in order to do less harm to the soil. This will require for the use of new materials and alloys that are both lightweight and resistant.
6- If oil prices continue to fall, commodity prices could remain at historically low levels, resulting in a high level of idle capacity and tight profit margins for the machinery industry.
7- There could be disrupting changes in electronics, software, communications, connectivity and robotization that affect the farm machinery sector.
8- New developments in sensor-technology could allow for detection of objects, moisture, soil quality, climate conditions, among other variables.
9- These sensors could help gather data that could then be transferred to software in order to trigger a certain action without need for external input, at much faster speeds than possible by human interaction.
The document also analyses the high complexity future farm machines could have. We highly recommend its lecture. Because of the reasons stated above, future holds for us a much different agriculture than the one we currently know, which will introduce our country and its farm machinery industry to significant challenges on a scientific and technological level.