President of FederUnacoma highlights market potential for the agricultural machinery sector

In an incisive speech, Mariateresa Maschio, president of the Italian Federation of Agricultural Machinery Manufacturers ("Federazione Nazionale Costruttori Macchine Agricole” - FederUnacoma), outlined both the potential of the market and the various economic and geopolitical variables that could make trade difficult for the sector. The president made an appeal for supportive policies for the sector during the entity's annual meeting.

The global agricultural machinery market is expanding, but faces significant fragmentation and increasing complexity in the variables to be managed. During an event held at Palazzo Albergati, in Bologna, Mariateresa Maschio highlighted that global tractor trade has grown at an average annual rate of 4,7% in the last 15 years. Forecasts for the period 2024-2027 indicate an average annual increase of 4,9%.

Furthermore, other types of agricultural machinery and equipment have performed even better, with an average annual growth of 5% over the last 15 years, and a forecast of 5,4% by 2027. However, for these forecasts to come true, It is necessary that climate patterns, which have become increasingly unpredictable, are favorable, ensuring production volumes and agricultural incomes that encourage investment.

At the industrial level, insidious variables include the cost of raw materials and energy, which could see additional increases if the conflict in the Middle East intensifies. This could increase machine prices and favor countries that produce low-cost technologies, seeking to capture market shares, including in Western markets.

The president of FederUnacoma also highlighted the impact of geopolitical dynamics on Italian exports. From sanctions on Russia to import tariffs introduced by many countries and the protectionist policies of emerging economic powers such as India and China, these measures can limit the export potential of Italian industry.

Geopolitics also influences trade routes and logistical costs. Systematic attacks by the Yemeni Houthis on cargo ships transiting the Bab el-Mandeb Strait and the Suez Canal have already caused a drop in transit (-65% in Bab el-Mandeb and -50% in Suez). This has forced ships to seek alternative routes, with shipping costs more than doubling in May this year compared to 2023.

Despite the challenges, the FederUnacoma assembly also identified development opportunities for the industry. Interesting markets for Italian producers include Southeast Asian countries such as Thailand and Indonesia, which are equidistant from the political blocs of China and the US, as well as rapidly developing African countries such as Nigeria, Kenya and Ghana.

Another boost for activities on the African continent should come from the Mattei Plan, to which the Federation can contribute by analyzing needs and providing technological solutions.

To mitigate critical factors and seize new opportunities, President Mariateresa Maschio concluded with a call for more robust support from politics and institutions. This includes differentiated programs for access to different foreign markets, as well as increasingly agile and flexible intervention and financial support tools.