The French agricultural machinery market was valued at USD 6,080 million in 2018 and is likely to witness a CAGR of 2.7% during the forecast period (2020-2025). As of 2017, due to a sharp decline in the sales of tractors during the first half in France, the European market observed a drop until the first quarter of the year. The demand for tractors decreased nearly by 20%, hence, the overall tractor market value was lower in the country, when compared to 2016. However, the sales in the second half was strong in the country. Owing to this fact, by the end of the year, tractor sales increased nearly by 3% in terms of units in the French market.
Key Market Trends
Large Scale Agricultural Production, Driving Mechanization
France has one-third of all agricultural land, in Europe. The major agricultural crops, grown in France, include sugar beet, wheat, maize, barley, and potatoes. According to Crop Trust (France), nearly 93% of the farms, out of 500,000 farms in France, are middle-range and large-scale projects. According to FAOSTAT, the area harvested, under major field crops in France, grew moderately, at a CAGR of 0.75%. In accordance with a recent approval by the French parliament, there has been a new large-scale reform framed, regarding the country’s agriculture and food policy. The major focus of the reform, is the improvement of France’s agriculture and food policies, focused primarily on the improvement of agricultural production. The trends have shifted towards the use of a smaller number of higher powered machines, and an increased focus on the country’s export potential. Thus, the improved government support, and increased interest in improving agricultural productivity, and improved farm structures, are boosting the demand for agricultural machinery, in France.
Tractors lead the French Agricultural Machinery Market
Tractors accounted for nearly 30% of the French agricultural machinery market. Factors like scarce human resources for farm labor, easy credit availability and fund access, moderate penetration and shortening replacement cycle have been encouraging indicators of demand for tractors and farm equipment and the government has also lent a supporting hand. In 2017, due to a sharp decline in the sales of tractors during the first half, the European market remained negative until the first quarter. The demand for tractors decreased nearly by 20%, hence, the overall tractor market remained negative, when compared to 2016. But the sales in the second half was strong in the country. By the end of the year, tractor sales increased nearly by 3%.
The French agricultural machinery market is highly consolidated, with the top six companies accounting for about 85% of the market share. Companies operating in the French agricultural machinery market are focusing on increasing their market share, primarily through acquisitions and investments in R&D, along with optimization of the supply chain.
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