European farm machine industry sentiment at record low - survey

PARIS (Reuters) - Europe's farm machinery sector sentiment fell to a record low in August, with a much gloomier mood in France countering a recovery in Britain from a post-Brexit slump in confidence, an industry survey showed on Thursday.

Demand for machines such as tractors and combine harvesters is sensitive to farm revenues. Companies like Deere & Co. (DE.N) and AGCO (AGCO.N) have felt the knock-on effects of low prices in many agricultural markets.

A poor harvest this summer in France, the European Union's biggest grain producer, is now expected to generate large losses for crop growers and add to a downturn in farming previously concentrated in livestock sectors.

The general index in industry association CEMA's survey of managers from nine European countries fell to a record low of minus 44 points, from minus 38 last month, reflecting an unusual situation whereby a majority of respondents in every country expect revenues to decline in the next six months, CEMA said.

"Companies from France regard their current business situation as much more unfavourable," CEMA said in a survey summary. "Germany, Poland and Austria continue at the bottom of the ranking."

Sentiment in Britain had improved after a drop in the wake of its vote to leave the EU, with some survey participants reporting a positive short-term impact from currency weakness, particularly in the crop sector, CEMA said.

Average order levels reported in the survey remained at a low level of just over 2 months, it said.

However, expectations had improved slightly for livestock equipment due to hopes of a recovery in milk prices, it added.

Persistent low prices in the past year have led the EU to offer hundreds of millions of euros in special aid for dairy farmers, as the sector has grappled with oversupply partly linked to the end of EU output quotas.

(Reporting by Gus Trompiz, editing by William Hardy)