Cautious optimism in Germany
Last year was a turbulent one for Germany’s agricultural machinery manufacturers. Tractor sales fell by just 3%, but the dip in demand for harvesting, milking and transport equipment was much steeper. One bright spot was the double-digit growth in demand for drills, planters and sprayers, and overall German tractor and farm machinery output slowed by 2% to a production turnover of €7.2 billion.
“The decline is certainly no reason for euphoria, but more for cautious optimism, and producer prices, especially for milk, are clearly picking up,” said managing director Bernd Scherer of the VDMA agricultural machinery organisation. The domestic market still plays a vital role for the Germany’s manufacturers. Good for a quarter of all production, overall sales on the home market slumped by 9% last year. Fortunately, strong growth in incoming orders during recent months is providing the sector with a welcome boost.
In other markets, especially outside the EU, the VDMA signals some strong growth rates. “Only France, the most important destination for German exports of agricultural machinery, needs to improve,” comments Mr Scherer. After years of insecurity, the agricultural machinery business did especially well in Russia and Ukraine. “Both markets are making an impressive comeback. In Russia, the market increased by 50%, and in the Ukraine by 70%.”
The VDMA reckons a total production volume of German farm machinery of around €7.1 billion is a realistic estimate for this year.
By Steven Vale