Favorable global business climate for ag machinery

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The manufacturers of tractors and agricultural machines are satisfied with their current business situation. The Agrievolution Alliance, a global network of the leading agricultural machinery associations, presented the 8th edition of its representative survey among manufacturers and importers of machines. According to this enquiry, every second company describes the business situation to be “good“ or “very good”.

The correspondent Agritech Business Climate index rose by three points. “Overall favorable economic conditions for farming around the globe have a crucial impact on the high machinery sales” said Gerd Wiesendorfer, coordinator of the Agrievolution Economic Committee. Worldwide turnover of the agricultural machinery industry is estimated to increase by 7 percent to $126 billion in 2013. 

Overall perspectives remain positive

In general, the perspectives on the agricultural machinery markets remain positive.

Sales went up during the past three months in most markets compared to a rather flat development during the first half of this year. On a global average, 45 percent of the manufacturers expect further growth of their turnover for the coming six months, while 37 percent anticipate their turnover to remain on the current level and only 18 percent expect decreasing sales. According to the survey, above average growth will occur in China, Brazil and Turkey for the next months, based on a higher order stock level. Agricultural policy programs play a certain role for this development. The European market seems to be flat or slightly decreasing for the coming months. As usual, the regional development within the continent will vary.  

click image to zoom Automation as key driver for the next years

Despite the current good conditions, some manufacturers mention the global challenges the farming sector in their countries face on the global commodity markets. Also financing to some extent is an issue for farmers. On the other hand, in the mid-term view, mechanization and automation on the field and for animal housing will remain a major driver for demand of new agricultural machinery.

The “Agrievolution Economic Committee” is a working group of the global network of the large agricultural machinery associations, the so-called “Agrievolution Alliance”. The group was founded in 2009, and has assumed the responsibility of promoting the exchange of market information for agricultural machinery at an international level, through its own projects. The goal is greater market transparency at a global level, in order to permit the representation of agricultural modernisation requirements on an economic basis. The following countries are currently members of the committee: Brazil, China, France, Germany, India, Italy, Korea, Japan, Russia, Turkey, United Kingdom and the USA. The American association AEM holds the secretary of the Agrievolution Alliance, while the German association VDMA Agricultural Machinery Association is responsible for the secretariat of the economic committee.

Further information about the organization and its next summit in India in December 2013 is available on www.agrievolution.com.

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