Agricultural Machinery
France has the largest market for tractors and agricultural
machinery (AGM) in Europe with a quarter of the European AGM
market. Estimated at USD 4.85 billion in 2005, it declined
5 percent in 2006. This was mostly due to the higher price
of raw materials and of energy, the recession that hit the wine
and fruit industry, and to poor weather conditions.
However, the French AGM market remains poised for a rebound in
2007. New environmental regulations regarding engine
exhaust emissions and soil erosion and the security of AG
vehicles should help increase the replacement rate of machines
over the short term. Imports have remained a vital part of
the industry, accounting for nearly 65 percent of domestic
demand. The U.S. is one of France’s top suppliers of AGM in
France (along with Germany and Italy), with a share of the
current market estimated at approximately 9.8 percent.
However, this percentage understates the U.S. presence, as many
American companies have invested or set up local manufacturing
plants.
Best Products/Services
The best prospects for U.S. companies include high-power combine harvesters, telescopic tractors, professional tractors for landscaping/mowing, tractor spare parts and accessories, computerized management of livestock and quality control equipment for livestock feed and self-propelled crop sprayers. The AG machines for maintenance and spare parts offers good opportunities for AGM dealers.
Opportunities
Industry analysts expect a rebound of some segments of the agricultural machinery and equipment sector for the next two years. Despite the EU’s enlargement that has created uncertainty and a general reluctance from French farmers to invest, increasing foreign competition combined with lower agricultural product prices will continue to push wealthy farmers to further mechanize and automate. In addition, the increase in the price of cereals, the anticipated allowance of direct subsidies confirmed by the French and EU governments, and the potential for bio-fuel development will contribute to sustain domestic demand for new equipment and techniques.
Innovation, especially in the safety and reliability of agricultural vehicles and machines, will continue to play an important role in the evolution of the sector.
Resources
AGRESTE (Statistics Office from the Ministry of
Agriculture)
www.agreste.agriculture.gouv.fr
SEDIMA (National Association of Agricultural Service Companies
and Machinery Distributors)
www.sedima.fr
SIMA (International Agribusiness Show in Paris)
www.simaonline.com
Embassy U.S. Commercial Service Trade Specialist: Christophe.Joly@mail.doc.gov
For data tables and additional information corresponding to this prospect please contact: Christophe.Joly@mail.doc.gov
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