In line with expectations, 2016 demand for farm machinery in Europe is set to end up with a drop, while the outlook for 2017 does not look much better, according to CEMA.
The European agricultural machinery body has said that for 2017 lower or at best stable demand is expected for most agricultural machinery products.
Despite the negative trend overall, CEMA said that certain countries performed relatively well so far this year, with France and Spain among the most positive markets in Europe.
However, demand on the French market started to slow down in the second half of 2016, and CEMA expects this trend to continue in the coming months, resulting in a further estimated decline of around 5% in 2017.
Meanwhile, the outlook for the Spanish market is positive for 2016 and the next year, with a 5% increase expected for 2017.
Germany is set to rank among the worst-performing markets in 2016, decreasing by 9%. The decline is set to continue in 2017, yet at a much slower pace, with an expected -2%.
Closer to Ireland and demand in the UK continues to be weak, particularly for non-tractor farm machinery, according to CEMA.
For 2017, the market is expected to stabilise. In the same way, markets in Italy, Belgium, and the Netherlands will likely experience a small decrease in 2016.
Tractor sales in Europe
Agricultural tractor sales in Europe in the first nine months of 2016 were 4.5% lower in comparison with the same period last year, figures show.
However, the decline in the third quarter was slowing down to -2.2% when compared to the corresponding period in 2015.
Demand is particularly lower for mid-range tractors between 125hp and 250hp, it found.
It is expected by the economic experts of the CEMA member associations that the demand for tractors will remain at a similar and relatively low level in 2017.
One remarkable occurrence is a peak in demand in September in the power category 56kW to 130kW (75hp to 175hp).
CEMA said that this can be explained due to the end of certain transitional provisions as part of the EU’s exhaust emissions legislation.
Many tractors with Stage IIIB engines needed to be registered before October 1, as, otherwise, they would not be allowed to be registered anymore.
Demand for agricultural machinery in 2017
Demand for most other major agricultural machinery products declined in the CEMA countries as well in line with predictions.
Combine harvester sales are expected to be down 13% in 2016, with drops observed in all CEMA countries.
For 2017, the market looks set to shrink further. Particularly in France, a significant reduction is expected.
The 2016 market for mowers experienced a further decline in 2016 of almost 10% – only the Spanish market grew and the French and Italian market were stable, according to CEMA.
In 2017, this trend is expected to continue with even lower demand.
A similar decrease of 10% is seen in the forage harvester market in 2016 and CEMA expects that demand will stabilise in 2017 with only minor rates of growth or decline in the different CEMA markets.
Meanwhile, the decrease for balers was rather limited at 2.4%, with demand in all countries stable or weakened only marginally. A slightly higher decline is forecast for 2017.
According to CEMA, sprayers were the only products where sales went up in 2016, with an increase of 3.6% mostly due to a large increase in Spain and to a lesser extent in Italy.
The sprayer market probably won’t keep up this growth rate for 2017, which can be attributed mainly to another high drop in demand expected in Germany.