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Downturn in European ag machinery market 'to end this year'

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The European market for agricultural equipment is stabilising, after a rapid decline, and could actually grow this year, the industry body Cema said.

The forecast is more upbeat than those made by a number of major equipment sellers earlier this year.

"The decline in sales of arable farm equipment in Europe slowed down in 2016 and is expected to come to halt this year," Cema said.

Cema sees equipment sales down some 2% in 2016, at E3.33bn.

But in 2017 the market is expected to "stabilise," and could even grow by 1%, Cema said, in comments which come amid some evidence of improvement in the US farm machinery market too.

Mixed market

Despite the overall decline, Nina Jansen, coordinator of Ceman said the European market for arable equipment presented a "picture full of contrasts" last year.

"Some Eastern European markets, particularly Russia and the Ukraine, enjoyed significant growth rates, especially in sales of field sprayers and precision seed drills.

"Growth in these markets partially compensated the decline of orders from other countries."

But sales in France saw "massive declines" due to the poor harvest and the subsequent effect on farm spending power, Ms Jansen said.

And similar large declines were seen in Poland, where "blocked subsidy payments" prevent farmers from investing.

The worst performing market was for crop sprayers, with sales down 8% in 2016, while good demand for big machines in Ukraine and Russia helped seed drill sales rise.

'Softer demand'

The upbeat outlook from Cema more bearish forecasts made recently by some major equipment sellers.

Tractor maker Case and New Holand has forecast its sales in Europe to fall by 5% this year, and equipment maker Agco saw "softer demand," in the region.

And Deere & Company similarly forecast a 5% decline in sales within the EU.

By William Clarke

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