Italy’s Agricultural Machinery Sector Faces Decline Amid Market Uncertainty and Demand Slowdown

The Italian agricultural machinery industry is seeing a significant decline in 2024, primarily driven by uncertainty in both domestic and international markets and a major slowdown in foreign demand, according to FederUnacoma, the Italian Agricultural Machinery Manufacturers Federation. Speaking at the International Agricultural and Gardening Machinery Exhibition (EIMA International 2024) in Bologna, FederUnacoma President Mariateresa Maschio announced that the sector’s national production value is set to close the year with a 19.5% decrease compared to 2023, totaling €13.2 billion.

Maschio attributed the contraction to reduced demand within Italy, as well as a marked downturn in international markets that heavily contribute to the sector’s revenue. “The decline is due to the contraction of domestic demand, but above all, to the slowdown of foreign markets, which contribute significantly to the turnover of Italian agricultural machinery companies,” she said. FederUnacoma anticipates that recovery may not emerge until the second half of 2025.

Detailed forecasts from FederUnacoma reveal that various segments within agricultural machinery are facing different levels of contraction. Tractors, for example, are expected to generate just over €2 billion, reflecting a 25% drop from 2023. Incomplete tractors and spare parts are down 28.6% to €1 billion, while operating machines and equipment are valued at €6.2 billion, down 16.5%. Components are forecasted at €3.3 billion, showing a 17.5% decrease, and gardening machinery and equipment are down by 22.2%, contributing €700 million to the sector’s total.

Maschio highlighted that the weakening domestic demand has been a major factor impacting turnover in 2024. “The Italian market for technologies for the primary sector, which in 2023 had already seen a 12.9% decrease in tractor sales, experienced even steeper declines from January to October of this year,” she explained. The year has seen tractor registrations decline by 14.6%, while other equipment such as combine harvesters and telescopic handlers experienced even sharper falls, with combine harvester registrations down 31.5% and telescopic handlers dropping by 14.9%.

Despite the challenging environment, Italy’s export market remains active. In the first half of 2024, exports of tractors and related agricultural machinery, excluding components and gardening equipment, decreased by 9% year-on-year, with a total value of €3 billion. The US, France, and Germany remain the main markets for Italian agricultural technologies, followed by Türkiye, which ranks fourth.

Maschio noted that the year-end forecast remains bleak, as FederUnacoma’s monitoring reports indicate that 70% of companies in the sector reported a lower turnover in the third quarter compared to the previous year. The majority of companies reported declines between 11% and 20%.

Looking forward, 60% of manufacturers expect market conditions to begin to improve in the second half of 2025, contingent on economic stability and supportive government incentives for new-generation agricultural machinery. Maschio emphasized that the pace of recovery in domestic demand would largely depend on the timely implementation of these incentives to stimulate machinery purchases within Italy’s agricultural sector.