Agricultural machinery market, an uneven picture

Data on the sales of tractors in the leading countries indicate growth in the United States and Europe in 2019, while India, China and Turkey are decreasing. Exports of Italian machinery are growing. Negative forecasts for the first months of the new year.

The world tractor market presented an uneven trend in 2019. The United States recorded a 3.6% growth in sales with 245 thousand units - explained the President of FederUnacoma Alessandro Malavolti during a press conference held this afternoon in Verona as part of Fieragricola - and the European Community also closed the year with a significant increase, with 8% on the basis of 178 thousand registered tractors, albeit with different performances from country to country. France closes with substantial growth (+16% based on 34,600 registered vehicles) - noted Malavolti - and Germany also closes with significant growth (+4.7% for 29,000 units), as well as the United Kingdom which marks a growth of 5.4%, while Spain records a +6.8%.

Russia was one of the countries that showed a positive trend, which in October was setting a growth of 15% and which is believed to have ended the year with a significant increase (albeit related to a limited number of machines - about 25 thousand - for a country of that size). The markets of India, China and Turkey show a different tone. The final balance relating to the Indian market - issued by the national manufacturers association TMA - indicates for 2019 a total of 723 thousand tractors, down 10% compared to the previous year, but in any case such as to confirm the Subcontinent as the largest market in the world by far in terms of units. The decline recorded in India is seen by analysts as a physiological adjustment after the impressive increase that characterized the last few years, and the prospects for the Asian giant remain positive also for the next few years given the conspicuous support plans for the agricultural economy fielded by the government. The situation is more critical on the Chinese market - claimed the President of the Italian manufacturers - which is estimated to have decreased by 20% during the year, due to the specific difficulties of the sector, in addition to the overall slowdown in the agricultural economy (insufficient productivity due to the small farm sizes and reduction of public subsidies for the purchase of agricultural machinery). The negative phase in Turkey is ongoing, triggered by a combination of political, economic and monetary factors, which in the first nine months of 2019 marked a drop of 54%, after the very substantial drops already recorded last year. The trend in 2019 is positive in the United States, France and Germany, which are the three main outlets for agricultural machines produced in Italy - Malavolti explained - and this is positively reflected in our exports. In the first ten months of 2019 - according to ISTAT data on foreign trade - exports grew overall by 2.5% in value compared to the same period of 2018, even if with a different trend for tractors, which marked a drop of almost 1%, and for the other agricultural machines which instead showed an increase of 3.7%. The overall turnover of exports of Italian machinery in the ten months amounts to almost 4 billion euros.

As regards the outlook for the current year, the Agrievolution forecasting observatory as well as the Business Barometer of the CEMA European Manufacturers Committee indicate a general market decline, at least in the first months of the year. In addition to the Far East and Europe, the North American and the Eastern European markets are also expected to contract. Together with tractors, the decrease should also concern the other types of machines and equipment, see for example machinery for tillage and crop protection, which CEMA expects to decline on the European continent. On the eastern front, an important variable is the epidemic in progress in China, whose consequences on the primary economy and on trade are still to be assessed.

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Italian Implements Manufacturers Association
Italian Self-Propelled Machinery Manufacturers Association
Italian Tractors Manufacturers Association
Italian Components Manufacturers Association
Italian Garden Machinery Manufacturers Association