Farm machine sales are showing a divide in French agriculture, with grain growers stepping up investments after a price rally but struggling livestock farmers still holding back, a Deere &Co. manager said.
Crop farmers were being much more careful, however, in choosing products after experiencing a market surge in 2007-08 followed by a downturn, Jean-Francois Pierre, a marketing manager with John Deere France, said during this week’s SIMA farm-equipment show near Paris.
Whereas a year ago French farm sectors were united in discontent about a broad downturn in agricultural markets, this season has seen fortunes diverge, with a surge in grain prices lifting growers’ revenues and squeezing livestock farmers for whom grains represent a large chunk of production costs.
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“It’s a two-sided situation: there is one part of agriculture that is getting by and another that is suffering,” Pierre said. “During the show I haven’t had a single meat farmer come and ask for information.”
MEAT FARMERS SQUEEZED
But equipment makers in France stressed that the mood among grain growers was much more prudent than in 2008 when a splurge of investments left some farmers struggling to pay debts later when markets turned lower.
“They lost their heads a bit in 2008,” said Alain Savary, director of Axema, an association of French farm machine manufacturers. “They are more careful now.”
Exhibitors also nuanced the picture in livestock farming, noting dairy farmers were seeing a pickup in prices unlike meat specialists, and that a crop focus at SIMA meant it was not wholly representative.
Still, the difficulties of livestock farmers are at the centre of debate in France and President Nicolas Sarkozy devoted most of his visit to the Paris farm show to reassuring disgruntled breeders.
“Currently 50 per cent of grains are consumed by animals, so if in the future we reduce the number of livestock and increase the crop area we could see a crisis develop in grains,” Guy Hermouet, vice-president of cattle farmers’ group the FNB, said.
