The Agricultural Engineers Association (AEA) moved to a new home in Hampton this week, and their brand new building received the royal seal of approval when HRH Princess Anne opened the new headquarters on Wednesday.

The association represents manufacturers of farming equipment from across Britain, and said that after years in the doldrums, manufacturers were starting to prosper again.

Among the members of the association are some of the biggest names in the farming equipment world, including John Deere, McCormick and JCB in 2007, the members of the AEA turned over £3.5 billion, and the value of sales of agricultural machinery in the UK – not including tractors, the major source of income in the industry – is estimated to be more then £730 million, an increase of almost a quarter compared with the previous year.

President of the AEA, Geoffrey Davies, said: "British agricultural machinery manufacturers are currently doing very well, and have their order books full.

"There is a lot of demand for machinery in the former Eastern Bloc where they are growing a lot of wheat, which is now not only used as food but also as bio-fuel.

"Because there is a duel use of wheat now, farmers are not being put under the cosh by supermarkets keeping prices down to look after their margins at the cost of the farmers, which is of course great news for the British industry.

"It is great to see British firms doing so well after they had been in decline for the last 10 to 15 years."

The export business for British firms accounted for some £1.5 billion last year, with many of the tractors, agricultural machinery and outdoor power equipment heading to Eastern Europe.

But it is not just the foreign market that has seen signs of improvement.

The number of new tractors registered in Great Britain by the end of May had risen by almost 1,000 compared to the first five months of 2007.

If the rate of the rise in sales continues for the remainder of the year, more than 17,500 units would be sold – the highest number in 20 years.

And for the first time in a decade, combine harvester sales look set to break the 1,000 unit mark.

But it is not all good news for the association's members, with the rising cost of the raw materials needed to make the equipment putting some pressure on budgets.

Chief Executive Roger Lane-Nott said that farmers could face an uncertain summer.

He said: "Last year, the price of wheat was around £60 per tonne, but by September it had reached £200 per tonne, which gave farmers a lot of confidence to order machinery.

"However, farmers have to deal with the current economical issues like everyone else, and with the rising price of oil, which means more expensive fuel costs, as well as the cost of fertilizer doubling, this year farmers will have to sell wheat at £130 per tonne to just break even.

"If confidence is high then the demand will remain, but we will have to wait and see, especially with the rising costs of the machinery itself.

"Manufacturers are also facing the pressure of high input costs of materials such as steel and copper, like in any other industry. There is also a shortage of tyres needed for the equipment.

"The exchange rate is also an issue, with the strength of the pound against the dollar and Euro making it difficult to trade with multi-national organisations.

"The first real indication of how things are going will be after the 2008 harvest. It is very difficult to tell what will happen in the future until November."

One of the main issues facing the farming industry in Britain is the need to help the world food shortage, where there is pressure for farmers to contribute wheat and other crops to help poorer countries.

Mr Lane-Nott said that critical issues in farming should be looked at again if Britain is to make a contribution.

He said: "If we are to help feed the world, which many people feel we have the moral obligation to do, then we have to look at using pesticides and genetically modified (GM) crops, as well as stabilising oil costs.

"For any chance of succeeding then we have to re-open the GM debate."

The AEA had spent the previous 21 years based in Orton Centre, but have moved to their new Samuelson House base in Forder Way, Hampton in their 132nd year since forming in 1875.

Mr Davies said that the new building showed their commitment to improving the industry in Britain. He said: "This will be a great showcase for the industry.

"We represent a who's who of manufacturers, and this will be a great facility to entertain visitors from across the country, as well as a great place to hold our board meetings.

"We were very fortuitous in getting this development in that it is in a superb location for those who are travelling here from all four corners of the country, in that it is very close to major transport links, and also not very far from where we were located before."

At the opening of Samuelson House on Wednesday, HRH The Princess Royal had the chance to inspect a variety of the tractors, lawn mowers and other machinery produced by the firms represented by the AEA, before unveiling a plaque to officially open the new building.

As well as with the agricultural sector, the association also represents firms manufacturing equipment including golf carts, quad bikes, and even chainsaws.

Along with representing manufacturing firms, the AEA also runs the National Sprayer Testing Scheme (NSTS), which tests thousands of sprayers on farms every year, and is contracted to run the secretariat of the Milking Equipment Association (MEA) and the Association of Manufacturers of Power generating systems (AMPS).