Dr. Reinhard Grandke, Managing Director of DLG (Deutsche Landwirtschafts-Gesellschaft – German Agricultural Society), Frankfurt am Main

The organiser DLG (Deutsche Landwirtschafts-Gesellschaft e.V.) once again reports excellent booking results for the world's leading trade fair for agricultural machinery and equipment, Agritechnica, being held at the exhibition grounds  in Hanover from 12 to 18 November 2017 (Preview Days on 12 and 13 November). More than 2,800 exhibitors from 53 countries will be presenting their innovations and current further developments under this year's main theme “Green Future – Smart Technology”. With an exhibition space of around 40 hectares, the Fairgrounds are fully booked. All the leading companies in the industry will be represented with a complete range of their programmes. Agritechnica thus impressively underscores its unfaltering high attractiveness and its position as the world's most important exhibition for agricultural machinery and equipment. This year again, DLG is expecting more than 400,000 visitors, including around 100,000 international visitors.

More international than ever

Agritechnica is more international than ever before. Nearly 1,700 (59 per cent) of the exhibitors come from outside Germany. This represents a new record level. The largest groups of international exhibitors come from Italy (370 companies), China (110), the Netherlands (109), Turkey (107), France (102), Austria (67), Poland (67), the United Kingdom (57), Canada (56), Spain (55), Denmark (49), Finland (47) and the USA (46). In addition, 13 countries have booked country pavilions, including for the first time Denmark and Ireland.

“Green Future – Smart Technology”

The trend towards further automation of processes, connected with intelligent data management systems for optimising regulation and control of machinery, logistics, documentation, quality assurance and traceability is forging ahead in the agricultural sector. By analogy with Industry 4.0, digitising and networking of the value chain as well is becoming increasingly more important in agriculture. Cloud Computing and Big Data have become firmly established concepts. At Agritechnica, manufacturers will be showing a wide range of solutions under the heading “Green Future – Smart Technology”. These will enable farmers to produce even more efficiently and with greater conservation of resources. This is evident from the more than 320 innovations submitted for Agritechnica by altogether 175 exhibitors from 24 countries. The independent committee of experts assigned by DLG to assess them has voted to present the Innovation Award in Gold for two innovations and the Innovation Award in Silver for 29 innovations.

Differing development in global farm sizes and capital investment

Globally a decline in the amount of land available to farms can be observed. Some 94 per cent of farms worldwide farm an area of up to five hectares. Yet these farms only farm nine per cent of the total agricultural land around the world. However, the farms of up to five hectares in the least developed countries farm around 75 per cent of the agriculturally useful area. The structural change in farming worldwide is proceeding at differing rates. There is hardly any structural change taking place in the countries of sub-Saharan Africa, the Middle East, North Africa and Latin America, where farm structures are largely stable. By contrast, structural change in the industrialised countries and in South Asia is advancing. Together with this, the degree of mechanisation in these countries is rising. A rapid increase in capital investment can be noted especially in the dynamically growing economies of South Asia.

Despite the structural differences, all farms contribute to global food security. They need access to technologies that allow sustainable increases in productivity. Access to site-adapted farm inputs that increase productivity is also necessary in order to achieve progress in food security. Finally, innovations are the prerequisites for enabling farms to boost food production while at the same time conserving natural resources. FAO statistics show that especially in sub-Saharan Africa, the Middle East, North Africa and Latin America, the investments in farms are too low to achieve sustainable increases in productivity.

Current situation on the markets

The global grain harvest with a record harvest in the Black Sea region is helping to build up stocks and thus produce an environment in which major price increases are improbable. Despite this there is hope for rising prices for better qualities that are in demand worldwide. And the decline in stocks among grain exporters is nourishing hopes for kinder price developments. However, the record harvest in the Black Sea region is leading to strong competition for grain exports from the EU countries. Furthermore, the strong Euro is making EU grain exports more expensive.

Firm prices are to be expected in dairy farming. Reasons for this are lower levels of production in the exporting countries and sustained high demand, especially for butter and cheese.

In pig farming a balanced relationship between supply and demand is leading to firm prices at present. Furthermore, pig farmers are profiting from low feed costs and a more favourable price-cost ratio. However, there is a sales risk due to declines in exports to China and uncertainty about further demand.

Europe's farmers look optimistically to the future

European farmers are looking at the business environment more confidently. The depressed mood prevailing up to 2016 has been overcome. Both the present business situation and the expectations of business development are being assessed far more positively than was the case in autumn 2016. Willingness to invest is also increasing again. This is demonstrated by the latest results of the DLG-Trendmonitor Europe from autumn 2017, for which 150 farmers each from Germany, France, the United Kingdom, Poland, and for the first time in August 2017 also from the Netherlands and Russia were surveyed.

Farmers distinctly more confident about further business development

The improved situation on the markets for cereals, milk and pigmeat is the reason for this upswing. The farmers questioned in all the countries, especially those in Germany, assess the current business situation far more positively than they did in autumn 2016. Farmers from the Netherlands, who were surveyed for the first time, also consider themselves well-positioned. They assess the present business situation best.

Europe's farmers have become more confident again as regards business development in the coming 12 months as well. There is hope for price increases for better grain qualities. The robust demand for dairy products and pigmeat also makes for positive prospects. And the sustained low interest level is also contributing to the buoyant mood. Farmers can finance investments on favourable terms and necessary follow-on financing arrangements can be concluded at a far more favourable level.

More friendly economic environment drives willingness to invest

The turnaround in the economic environment is encouraging an increase in farmers' readiness to invest again. As the current DLG-Trendmonitor shows, farmers in Poland and Russia are most ready to invest. In the coming twelve months they are planning investments above all in field operations. According to the survey, French farmers report the lowest level of investment plans.

Key areas of planned investments

Farmers see a great need to invest in tractors.

• Russian farm managers, but also farmers in Poland, the United Kingdom and Germany see a great need here.
• In the case of combines, the greatest investment plans are reported by Russian and Polish farmers.
• Forage harvesters are also on the list of investment intentions in Poland and Russia, but in the Netherlands as well.
• Self-propelled plant protection sprayers were cited most in Germany and the Netherlands.
• Farmers in Poland and Germany want to invest in mulching and direct drilling machinery and equipment.
• Green harvest and forage harvesting technology as well as investments in fertilising and crop protection technology and also in automatic steering systems were mentioned most frequently by the Dutch farmers.
• As regards soil working machinery, farmers in France, Germany and Russia in particular plan to invest.

Germany – Digitisation is still at the start

The DLG-Trendmonitor also shows that digitising is still in its infancy in Germany's agricultural sector. The answers given in response to questions about the use of software in farm management were reserved. Farmers currently make regular use of data transfer to advisory centres and to public authorities in order to submit applications in this way. The use of apps is widespread among farmers. The apps offer support in daily farm management tasks and can be installed quickly and easily. However, farmers are so far more reserved about using cloud software and decision-support systems. The still inadequate data infrastructure in many regions as well as the continuing uncertainty about data safety and privacy is slowing their use down. However, the trend towards further automation of processes, associated with intelligent data management systems for optimising regulation and control of machinery, logistics, documentation, quality assurance and traceability, is making headway in the field of agriculture and offering new solutions to farmers.

Modern agriculture needs consensus with society

New technical solutions are necessary. This is because the challenges worldwide can only be mastered with innovative agriculture that integrates the consistent further developments in knowledge and skills. One of the basic conditions for this is robust and continuous consensus with society about the agricultural production processes. Progress in agricultural production and production methods and their assessment in society must basically be in harmony with each other. This is no longer the case in some areas at present. That is why the great challenge for agriculture consists in tackling the declining acceptance of modern agriculture in society and developing accepted solutions. A key approach to dialogue with society is formed by the agricultural machinery innovations that make major contributions to farming methods that conserve the environment and resources. Farmers must draw attention to this more in dialogue with society. One information platform for this is Agritechnica with a fireworks of innovations and a top-flight international technical programme.

Detailed information on Agritechnica 2017: www.agritechnica.com