Biso Romania’s chief executive of six years, Andreas Feichtlbauer-Mayer, says the company had not expected the Romanian market to grow at the rate it has been growing. As a result, it will change strategy to have Romania covered and also go to Russia or Ukraine. At first it had planned for Romania to generate half the business in the region, but the country is currently generating 80% of the revenue and Russia and Ukraine account for the rest, he added.
The change of strategy comes after the market of farming tractors has almost doubled in the last three years to 1,821 units sold by importers and local producers by the end of 2011. The market of combines went up, as well, though slower, by 13% to 566 units, according to market data.
The growth of the market was fuelled to a certain extent by farming subsidies and European-funded projects submitted by farmers.
Biso’s boss says that another major factor driving the farming equipment market up is the large crops harvested by Romania’s farmers. Looking at sales he can see that Romanian farmers’ interest in corn crops is huge, which is why headers (used by combines for harvesting) and seeders are selling like hot cakes.
Farmers had one of the best years of the last decade in 2011, with record wheat and corn harvests driving agricultural output to EUR19 billion.
There is room on the farming equipment market for growth, Andreas Feicthlbauer-Mayer says. He believes the growth may gradually reach 150% and the market can accommodate even more competitors.
Biso sells seeders and headers, as well as tractors and combines made by Italy’s New Holland, a giant in its business.
Biso owns a plant in Romania in which it invested EUR7.5 million in 2010-2011, where it manufactures farming equipment.
Besides farming equipment manufacturing and sales, the company also provides farm management services to some of the foreign investors that bought land in Romania. It assists Austrian, German and Swiss investors in operating about 7,500 hectares and also has some land of its own.
Biso’s chief executive says farmland comes cheap in Romania but with certain risks attached such as legal problems, logistics or management issues. To offset risks Biso has also started green power investments, having spent EUR0.7 million on biomass and solar power projects so far.
Biso’s competitors on the manufacturing segment in Romania are Maschio Gaspardo and Mecanica Ceahlau, while rivals in terms of combine and tractor sales include importers like IPSO (John Deere), NHR Agropartners (New Holland) and Titan Machinery (CNH).
(English version by Loredana Fratila-Cristescu)