VDMA Agricultural Machinery Association: The European ...
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Contact<br />
Phone<br />
Fax<br />
E-Mail<br />
Press Release<br />
Christoph Götz<br />
+49 69 6603-1891<br />
+49 69 6603-2891<br />
christoph.goetz@vdma.org<br />
<strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong> <strong>Association</strong>: <strong>The</strong> <strong>European</strong><br />
agricultural machinery industry expects a 15% increase in 2008<br />
Frankfurt, 9 th July 2008 – <strong>The</strong> degree of capacity utilization in the <strong>European</strong> agricultural<br />
machinery industry has been high for months. According to the <strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong><br />
<strong>Association</strong>, turnover will increase by approximately 15% to € 27.5 billion in 2008. This would<br />
be the highest growth of the past decades Europe-wide, which illustrates that the industry is<br />
in the middle of a boom phase.<br />
Modern agricultural machinery makes an important contribution to an increase in food and<br />
feedstuff production and thus helps to reduce the scarcities of many agricultural products<br />
which have developed on the world market. In addition, the growing importance of energy<br />
supply based on biomass technology with agricultural machinery as the decisive problem<br />
solver must be considered.<br />
<strong>The</strong> <strong>European</strong> manufacturers of agricultural machines and tractors are the main player in the<br />
global agricultural machinery industry. Last year, sales in the <strong>European</strong> Union reached €<br />
23.9 billion and thus accounted for 42% of worldwide production. Manufacturers in Germany<br />
hold a share of almost 11% of worldwide production. After their 17% growth in turnover in<br />
2007, they will reach a record increase of more than 20% by the end of the year.<br />
According to the <strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong> <strong>Association</strong>, the market environment remains<br />
positive. <strong>The</strong> association states that increase rates in the export business are lower in some<br />
countries, such as Russia, but that willingness to invest is currently strong, in particular on<br />
the traditional sales markets such as France, Germany, and the UK. Important agricultural<br />
nations like Brazil and India are also increasing their demand for modern machinery in order<br />
to guarantee the reliable supply of the population with food and to strengthen their position<br />
as exporters of agricultural products on the world market.<br />
<strong>The</strong>se additional investments into the machinery park have become possible thanks to the<br />
higher incomes of the past two years. For several months, however, the significantly higher<br />
prices of operating resources (e.g. energy) have dampened the optimism of the farmers.<br />
Thus, the available purchasing power for more investments in agricultural machinery will<br />
primarily depend on the development of the contribution margins in agriculture.<br />
<strong>VDMA</strong><br />
German Engineering Federation<br />
<strong>Agricultural</strong> <strong>Machinery</strong> <strong>Association</strong><br />
Chairman:<br />
Hermann Merschroth<br />
Managing Director:<br />
Dr. Bernd Scherer<br />
Lyoner Str. 18<br />
60528 Frankfurt am Main<br />
Germany<br />
Phone +49 69 66 03-13 04<br />
Fax +49 69 66 03-14 64<br />
E-Mail landtechnik@vdma.org<br />
Internet www.vdma.org
<strong>Agricultural</strong> <strong>Machinery</strong><br />
Economic Report<br />
2008
Contents<br />
Table of<br />
2 Foreword<br />
4 Production and Trade of <strong>Agricultural</strong> <strong>Machinery</strong><br />
4 World<br />
5 USA<br />
5 South America<br />
6 India<br />
6 Eastern Europe<br />
7 <strong>European</strong> Union<br />
7 Germany<br />
8 Market Development for <strong>Agricultural</strong> <strong>Machinery</strong><br />
8 View on Individual Branches<br />
11 <strong>European</strong> Union<br />
12 Germany<br />
13 Russia<br />
13 Ukraine<br />
14 Kazakhstan<br />
15 USA<br />
16 Brazil<br />
16 Argentina<br />
17 India<br />
18 China<br />
Condensed Version for the Public<br />
19 Charts and Tables<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 1<br />
19 <strong>Agricultural</strong> <strong>Machinery</strong> in the <strong>European</strong> Union<br />
20 Ex- and Imports of <strong>Agricultural</strong> <strong>Machinery</strong><br />
Worldwide<br />
21 Imports of Selected Countries<br />
22 Exports of Selected Countries<br />
23 Companies and Employees<br />
23 German Market Volume for <strong>Agricultural</strong><br />
<strong>Machinery</strong> by Segments<br />
24 <strong>Agricultural</strong> Key Figures of the Biggest Agrarian<br />
Nations<br />
25 Members of <strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong>
2 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
Foreword<br />
Europe and the world — the export business of German machinery and<br />
equipment manufacturers is the motor of our economic success and the<br />
condition for future growth. An export quota of 77% in the entire mechanical<br />
engineering sector is convincing proof of this statement. Almost one fifth of all<br />
machines (in terms of value) which are commissioned in the world come from<br />
Germany. Thus, it is not astounding that virtually all branches of the German<br />
mechanical engineering industry are either world market leaders or occupy<br />
second place.<br />
<strong>The</strong> world needs machines from Germany, and the German mechanical<br />
engineering industry needs the world and its open markets. In the past four<br />
years, the exports of agricultural machinery made in Germany increased by 60%<br />
even though the prospering Asian region has not yet played an important role<br />
so far. Currently, business activities are still focusing on Western and Eastern<br />
Europe.<br />
As the leading export nation in the world, we have a vested interest in open<br />
markets and clear export conditions. With regard to trade policy, it is therefore<br />
one of our core claims that the EU Commission should promote our<br />
competitiveness by extending a strong, multilateral trade system and provide<br />
better access to markets in third countries. In a globalized economy, this can<br />
best be achieved by a functioning WTO. <strong>The</strong> Doha development round initiated<br />
in 2001 is intended to provide an equilibrium of economic growth,<br />
environmental protection, and social justice in the world. If no significant<br />
progress is reached by the summer of 2008, which is a realistic danger, the<br />
round must be interrupted for the time being due to the elections in the USA<br />
and the new composition of the EU Commission.<br />
In addition, the <strong>VDMA</strong> is worried about the current state of the negotiations.<br />
<strong>The</strong>re is the danger of an unbalanced opening of the markets which forces the<br />
industrialized countries to make considerable concessions, whereas newly<br />
industrialized countries can maintain their trade barriers. Supported by the<br />
political goals of the governments of the member states, the <strong>European</strong><br />
Commission nevertheless keeps to its objective to complete the Doha<br />
development round soon. We see the danger that the Doha round will be<br />
finished for political reasons even if the results are not satisfactory from a<br />
current viewpoint, in particular for industry.<br />
Additional bilateral agreements between the EU and states or groups of states<br />
can be useful for the elimination of non-tariff trade barriers and high import
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 3<br />
tariffs. For this purpose, negotiations are underway like those about a free-trade<br />
agreement between Ukraine and the EU. In talks with the EU Commission, the<br />
<strong>VDMA</strong> has already attracted attention to a subsidy programme of the Ukrainian<br />
government for the purchase of agricultural machinery, which, however, only<br />
subsidizes locally manufactured machinery. <strong>The</strong> condition is a “local content“ of<br />
at least 50%. Since local production capacities are being built up step by step,<br />
we are advocating a reduction of the share of national products to<br />
approximately 25 to 30%.<br />
Russia and combine harvester import are good examples of the vulnerability of<br />
trade systems. Russia claims anti-dumping procedures and measures for the<br />
protection of domestic industry. In a safeguard clause procedure, Russia is<br />
trying to improve the competitiveness of Russian industry through tradepolitical<br />
measures. We think that this will be a short-sighted strategy at the<br />
expense of Russian agriculture, which needs modern machinery to maintain its<br />
position on the prospering raw material markets worldwide in the long run. <strong>The</strong><br />
<strong>VDMA</strong> position of an open market with low tariffs is supported by both the<br />
federal government and the EU Commission.<br />
China is not yet a very important market for agricultural machinery from<br />
Germany even though it is the third most important export market for the<br />
German mechanical engineering industry as a whole. Even though China<br />
reduced tariffs and made it easier for foreigners to enter the country after its<br />
accession to the WTO, important areas of the Chinese economy are still<br />
protected against international competition today. Complicated licensing<br />
procedures, costly and time-consuming certification regulations, and hidden<br />
government subsidies are just some examples. In discussions with Chinese,<br />
<strong>European</strong> and German decision makers, the <strong>VDMA</strong> is advocating the mutual<br />
recognition of local examinations, the application of internationally accepted<br />
standards, the transparency of tariffs, and improved copyright protection.<br />
According to a current <strong>VDMA</strong> study about product and brand piracy, more than<br />
two thirds of the companies in our industry are affected by counterfeiting,<br />
which causes an annual damage of € 7 billion. In this respect, China clearly<br />
occupies the leading position among its neighbouring countries, which follow at<br />
a large distance. <strong>The</strong> EU Commission in Brussels has interfered and realized one<br />
of the measures claimed by the <strong>VDMA</strong> by installing a help desk in Beijing.<br />
<strong>The</strong> <strong>VDMA</strong> is the leading association of the equipment goods industry in<br />
Europe. In no other country does the mechanical engineering industry have such<br />
great economic importance. We consider this as an obligation to make our<br />
claims in economic policy heard on behalf of the entire mechanical engineering<br />
industry. For this reason, we are extending our network of representative offices<br />
currently located in Calcutta, Delhi, Beijing, Shanghai, Tokyo, and Moscow.<br />
Hermann Merschroth<br />
President of the <strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong> <strong>Association</strong><br />
Frankfurt, July 2008
4 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
1. Production and Trade of <strong>Agricultural</strong> <strong>Machinery</strong><br />
According to <strong>VDMA</strong> estimates, the value of<br />
global agricultural machinery production in<br />
2007 amounted to a converted € 57 billion.<br />
<strong>The</strong> largest sales are still achieved in the<br />
<strong>European</strong> Union. However, the share of the EU<br />
dropped by one percent to 42% as compared<br />
to 2006. One reason for this development was<br />
the significant production boost in South<br />
America and the greater importance of Indian<br />
and Chinese manufacturers on the world<br />
market.<br />
Worldwide Production of <strong>Agricultural</strong> <strong>Machinery</strong><br />
in Bn. Euros<br />
<strong>European</strong> Union<br />
North America<br />
Latin America<br />
China<br />
Fläche für Grafik<br />
India<br />
2006 Fläche für Grafik<br />
East Europe<br />
2005<br />
Japan<br />
Others<br />
Source: <strong>VDMA</strong>, own calculations<br />
2007<br />
0 5 10 15 20 25<br />
In the past three years, sales in the industry<br />
increased continuously at a nominal growth<br />
rate of 5% in 2006 and a remarkable 13% in<br />
2007. For 2008, the development is showing a<br />
similar trend as in the previous year. Given a<br />
share of 28% respectively 11% in global sales,<br />
the North American and German manufacturers<br />
expect a sales growth of about one fifth<br />
for 2008. <strong>The</strong> current bottleneck on the global<br />
agricultural market and the greater pressure<br />
towards an intensification of agriculture are<br />
going to give an additional impetus to<br />
business in the agricultural machinery sector<br />
in the medium run.<br />
According to the latest estimates, global<br />
tractor production amounts to 1.4 million<br />
units. In 2007, combine harvester production<br />
volume grew to about 37,000 machines.<br />
Global trade volume grows by 12%<br />
<strong>The</strong> globalization of the agricultural machinery<br />
industry is continuing. Thus, the global<br />
trade volume is growing even though the<br />
domestic demand for new agricultural<br />
machinery is significant in most countries<br />
which produce agricultural machinery. In<br />
2007, the trade volume in the agricultural<br />
machinery sector amounted to € 32.3 billion<br />
(+12%) 1 . <strong>The</strong> largest exporters are Germany,<br />
the USA, and Italy. Despite a weaker rate of<br />
the dollar, the share of US exports in the<br />
global trade volume (in terms of euros) fell by<br />
1.5% to slightly less than 15% in the past three<br />
years, while Germany was even able to<br />
slightly increase its share to 20%.<br />
Shares of World Trade with <strong>Agricultural</strong> <strong>Machinery</strong><br />
Year 2007<br />
Others<br />
39%<br />
Japan<br />
4%<br />
United<br />
Kingdom<br />
5%<br />
France<br />
7%<br />
Germany<br />
20%<br />
Italy<br />
10%<br />
USA<br />
15%<br />
Source: National statistic agencies, total of exports of 42 countries<br />
In 2007, the machinery exports of Japan, the<br />
sixth largest exporter, decreased. In the sector<br />
of compact tractors and implements for<br />
gardening and landscaping, which account for<br />
1<br />
<strong>The</strong> volume is based on the sum of exports from<br />
42 countries worldwide which represent an<br />
estimated 95% of global agricultural machinery<br />
trade.
a significant share of Japanese production,<br />
business was not always good. In 2007,<br />
Chinese exports grew by 44% to € 1.3 billion.<br />
Thus, this country, which focuses on pump<br />
technology, lawn mowers, and small tractors,<br />
now occupies eighth place among the nations<br />
which export agricultural machinery. Even<br />
though India plays an important role for the<br />
industry given an estimated share of 6% in<br />
global production, the export volume is very<br />
low, reaching about € 250 million according to<br />
the latest available figures. One reason for<br />
this development is that the domestic market<br />
provides great potential for the manufacturers.<br />
In addition, enterprises such as Mahindra<br />
& Mahindra are also pursuing the strategy of<br />
serving foreign markets by building their own<br />
local production sites, which is illustrated by<br />
two factories in the USA.<br />
USA: production growth supported by the<br />
favourable exchange rate<br />
While export-oriented industry in Europe is<br />
moaning about the high exchange rate of the<br />
euro, the USA has gained considerable<br />
advantages in competition by devaluating its<br />
own currency in recent years. However, these<br />
advantages have obviously not changed the<br />
US position on the global market significantly.<br />
In terms of US dollars, agricultural<br />
machinery exports from the USA increased by<br />
19% to 6.48 billion in 2007 2 . Given a growth of<br />
14% to US $ 1.3 billion, the increase in the<br />
value of exports into the euro zone was below<br />
average. Instead, the large, rising agricultural<br />
nations Russia, Ukraine, Kazakhstan, Brazil,<br />
and Argentina, which have primarily become<br />
importers of large tractors from the USA, are<br />
decisive also for US manufacturers.<br />
In 2007, the number of combines manufactured<br />
and assembled by the companies Agco,<br />
Claas, John Deere, and Case New Holland,<br />
which produce in North America, was a<br />
remarkable 22% higher than in the previous<br />
year, reaching 8,500 units. In the first five<br />
2 <strong>The</strong> export value calculated in euros, however,<br />
grew by only 9% (average rate for 2007: 1 US dollar<br />
= 0.7297 euros).<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 5<br />
months of 2008, 4,000 machines left the<br />
assembly lines, which is an increase of 11%.<br />
Main Destinations for US Exports<br />
Average of the years 2005-2007, in Mn. US $<br />
Canada<br />
Australia<br />
Germany<br />
France<br />
Mexico<br />
United Kingdom<br />
Russia<br />
Netherlands<br />
Belgium<br />
Ukraine<br />
Argentina<br />
Kazakhstan<br />
Source: US Census Bureau<br />
0 200 400 600 800 1000 1200 1400 1600<br />
New spirit of optimism in South America<br />
After the depression in 2005 and 2006, the<br />
production of agricultural machinery in Brazil<br />
and Argentina is booming again.<br />
<strong>The</strong> main location of agricultural machinery<br />
production on the subcontinent is Brazil. Here,<br />
production showed a significant range of<br />
fluctuation in the past four years. According to<br />
information provided by the national association<br />
of manufacturers, total sales in the<br />
agricultural machinery industry in Brazil<br />
amounted to US $ 3.02 billion in 2007 (+48%).<br />
This meant that 77% of the production<br />
capacity was utilized. <strong>The</strong> number of employees<br />
grew from approximately 35,000 in the<br />
year 2006 to almost 41,000. Combine<br />
harvester production decreased from the<br />
record level of 2004 (10,000 units) to 2,300<br />
units in 2006. In 2007, it reached 5,200 units<br />
again.<br />
Tractor sales showed the same development,<br />
though to a slightly lesser extent. At six main<br />
locations, more than 50,000 tractors were<br />
manufactured again in 2007, which equals<br />
the number of all tractors produced in France,<br />
Finland, and Austria, for example, or more<br />
than 80% of the unit numbers in Germany. In<br />
the first five months, Brazilian tractor<br />
production grew by 40%, and combine
6 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
production increased by 91%. For the entire<br />
year 2008, production is expected to exceed<br />
the level of the current record year 2004.<br />
High tariffs for imported machinery<br />
<strong>The</strong> overall balance of the reports from<br />
Argentina for 2007 were also euphoric. <strong>The</strong><br />
agricultural machinery industry in this<br />
country achieved record sales of pesos 1.4<br />
billion (ca. € 260 million). <strong>The</strong> market, which<br />
has a volume of approximately € 700 million,<br />
however, is largely supplied with imported<br />
machinery. Imported machines from Brazil are<br />
not subject to any restrictions, whereas a high<br />
tariff of 14% applies to imports from countries<br />
outside the Mercosur region. For the local<br />
market, some manufacturers of tillage<br />
equipment are important (e.g. Chalero,<br />
Yomel), which meet the demand for simple<br />
direct drilling equipment. Given the crisis of<br />
national agricultural policy since March/April<br />
2008 and the resulting reserved attitude of<br />
farmers towards investments (cf. market<br />
description in the following chapter), these<br />
smaller companies which focus on the<br />
Argentinian market are incurring considerable<br />
sales losses and have been participating in the<br />
protest marches of the farmers against the<br />
government.<br />
India as a rising location of agricultural<br />
machinery production<br />
India has an important agricultural machinery<br />
industry. Its export share, however, is relatively<br />
small. <strong>The</strong> list of combine manufacturers<br />
alone comprises 76 producers, among<br />
them the big manufacturers Claas, Standard,<br />
Kartar, Sonalika, and Preet. In 2007, tractor<br />
production increased to 400,000 units. <strong>The</strong><br />
most important manufacturers are Mahindra<br />
& Mahindra, Tafe, Escorts, and Sonalika.<br />
<strong>The</strong> agricultural machinery industry is<br />
concentrated in the states of Haryana,<br />
Madhya Pradesh, Maharashtra, Punjab, Tamil<br />
Nadu, Uttar Pradesh, and Uttaranchal, i.e.<br />
rather in the north and the centre of the<br />
country. <strong>The</strong>se regions have a relatively good<br />
infrastructure and are situated favourably<br />
with easy access to traffic routes and big<br />
ports.<br />
<strong>The</strong> demand for an increase in productivity<br />
and, hence, more machinery use in Indian<br />
agriculture is very strong. This is likely to open<br />
the doors for foreign manufacturers even<br />
more. For subsidies, improvements of<br />
machines such as of sugar beet harvesters,<br />
rice transplanters, and cotton pickers by<br />
means of joint venture, technical cooperation,<br />
or imported machinery are expressly required.<br />
Eastern <strong>European</strong> manufacturers are gaining<br />
market shares<br />
In Eastern Europe, some manufacturers have<br />
gained a very good position on the market. A<br />
prominent manufacturer is the Minsk Tractor<br />
Factory, which produced 60,000 tractors last<br />
year. Approximately 80% of this production is<br />
exported onto neighbouring markets as well
as the Balkan countries, Bangladesh, Pakistan,<br />
and Egypt.<br />
In Russia, Rostselmash is predominant in the<br />
harvesting machinery sector. In 2007, 5,200<br />
combines were produced. In addition, some<br />
specialists, such as Klever (forage harvesting<br />
equipment), Cervona Zirka with its Russian<br />
subsidiary Belinskselmash (tillage implements<br />
and sowing equipment) as well as BDM-Agro<br />
(tillage implements) and Eurotechnika (tillage<br />
implements and fertilizer spreaders) must be<br />
mentioned.<br />
Solid growth in Europe<br />
<strong>The</strong> <strong>European</strong> Union is the largest location of<br />
global agricultural machinery industry. In<br />
2007, sales of € 23.9 billion were achieved<br />
(+11% as compared with the previous year). It<br />
has always been a special characteristic of the<br />
highly differentiated <strong>European</strong> industry that it<br />
offers machines for both small-structured<br />
agriculture and very large areas. This covers<br />
the regionally very different demands e.g. of a<br />
farmer in Southern Italy who cultivates an<br />
area of 4 hectares and a farm in Eastern<br />
Germany or the Czech Republic which has 200<br />
or 500 hectares of arable land. <strong>The</strong> <strong>European</strong><br />
manufacturers are also geared towards farms<br />
in Eastern Europe, some of which have a<br />
cultivated area of up to 10,000 hectares.<br />
In recent years, export business in the east<br />
was predominant, especially for German<br />
manufacturers. Nevertheless, the main sales<br />
markets still lie in the <strong>European</strong> Union, and<br />
they kept their importance thanks to the good<br />
economic situation.<br />
Tractor production in the <strong>European</strong> Union,<br />
which accounts for more than one third of the<br />
industry sales, increased by 2% to 232,000<br />
units in 2007. Given a trend towards higher<br />
average power, production value grew by 11%<br />
to € 9.0 billion. Locations largely remained<br />
constant in 2007. Only the production of<br />
McCormick was relocated from the UK to Italy.<br />
For this reason, overall unit numbers in the UK<br />
decreased slightly. Since the demand remained<br />
unrestricted, production in most<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 7<br />
factories kept increasing. As a result, an<br />
increase by approximately 8% in the number<br />
of units produced to more than 250,000 units<br />
can be expected in 2008.<br />
Tractor Production in the <strong>European</strong> Union<br />
in units<br />
2005 2006 2007<br />
Change<br />
Italy 86.526 82.584 83.310 0,9%<br />
Germany 54.590 58.623 60.732 3,6%<br />
France 27.280 26.551 27.984 5,4%<br />
United Kingdom 26.685 25.557 25.068 -1,9%<br />
Finland 9.945 10.380 10.737 3,4%<br />
Austria 8.922 9.399 9.768 3,9%<br />
Poland 5.957 6.381 7.041 10,3%<br />
Czech Republic 5.505 6.492 7.000 7,8%<br />
Spain 283 428 450 5,1%<br />
Total 225.693 226.395 232.090 2,5%<br />
Sources: <strong>VDMA</strong>, CEMA, excl. Romania with only marginal production left at Traktorul<br />
Brasov, Italy incl. crawlers, Czech and Polish figures 2007 preliminary<br />
<strong>The</strong> <strong>European</strong> manufacturers keep expanding.<br />
In business climate surveys in May and June,<br />
60% of the managers announced that they<br />
would once again increase production and<br />
sales in the coming six months. 50% of those<br />
surveyed would like to do this with more staff.<br />
Germany expects a 20% increase<br />
Germany accounts for 11% of global sales and<br />
25% of the <strong>European</strong> sales figures. Production<br />
focuses on tractors and harvesting machinery.<br />
Three of the four production sites for selfpropelled<br />
forage harvesters are situated in<br />
Germany (Claas, Krone, and John Deere). <strong>The</strong><br />
fourth factory is located in Belgium (Case New<br />
Holland). Agco announced an own developed<br />
forage harvester for the year 2010. In terms of<br />
sales, Germany´s share in <strong>European</strong> tractor<br />
production is 34%. <strong>The</strong> main production sites<br />
are Mannheim (John Deere), Marktoberdorf<br />
(Agco Fendt), and Lauingen (Same Deutz-<br />
Fahr). In 2008, approximately 67,000 tractors<br />
are going to leave the assembly lines.<br />
<strong>The</strong> about 200 German agricultural machinery<br />
manufacturers offer a wide range of machines.<br />
Some of the medium-sized producers<br />
can term themselves <strong>European</strong> market leaders<br />
and often also have an export share of 70 or<br />
80%.
8 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
<strong>The</strong> positive economic development in<br />
Germany is unbroken: In 2008, production is<br />
expected to increase by at least 20% to<br />
approximately € 7.4 billion. In the past<br />
decades, such a high increase was not<br />
achieved within one year. Whether growth is<br />
going to reach 20 or 25% primarily depends on<br />
the production capacities because the number<br />
of orders received is 50% higher than in the<br />
previous year. In many cases, machines which<br />
are ordered now will not be produced until<br />
2009.<br />
In 2007, the number of regular employees<br />
was increased by 6% to 27,000. Meanwhile, it<br />
has become a big problem to find qualified<br />
skilled workers and engineers. However,<br />
obstacles due to German labour market policy<br />
are considered high. <strong>The</strong>refore, large numbers<br />
of loan workers are hired. A <strong>VDMA</strong> survey<br />
showed that currently almost every sixth<br />
employee in the German agricultural machinery<br />
is paid by a temporary employment<br />
agency.<br />
<strong>The</strong> export share of German industry is<br />
traditionally high. In the agricultural machinery<br />
sector, it is approximately 74%. Expansion<br />
in Eastern Europe has been continuous since<br />
2000 so that exports into the large-area<br />
countries Russia, Ukraine, Belarus, and<br />
Kazakhstan already accounted for 15% of total<br />
exports in 2007. Russia is the third most<br />
important sales market after Germany and<br />
France.<br />
Production of Selected Machines in Germany<br />
in units<br />
2005 2006 2007 Change<br />
Combine harvesters 6.087 6.658 6.994 5,0%<br />
Forage harvesters 1.697 1.902 2.098 10,3%<br />
Mowers 18.819 18.502 17.671 -4,5%<br />
Tedders and rakes¹ 29.090 24.994 18.837 -24,6%<br />
Balers 6.768 6.133 6.363 3,8%<br />
Ploughs 2.689 3.719 4.297 15,5%<br />
Seed drills² 7.355 8.269 9.572 15,8%<br />
Field sprayers 2.133 2.793 3.042 8,9%<br />
Source: Turnover Statistics <strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong> <strong>Association</strong>, ¹ from 2006 partial move of<br />
production out of Germany, ² without precision seed drills<br />
2. Market Development for <strong>Agricultural</strong> <strong>Machinery</strong><br />
Market and technology development in<br />
individual branches of industry<br />
In Western Europe, 175,000 tractors were sold<br />
in the past year, which is an increase of 2%. In<br />
2008, this volume will be exceeded noticeably.<br />
In the first quarter, the number of new<br />
registrations already exceeded the figures of<br />
the previous year by 1%, and the second<br />
quarter will provide a very remarkable<br />
increase. On the large markets France,<br />
Germany, and the UK, market growth is<br />
disproportionate. <strong>The</strong> Italian market, however,<br />
is expected to stagnate again. In Western<br />
Europe, average engine power is currently<br />
76 kW (slightly more than 100 hp) and was<br />
increased continuously over the course of the<br />
past years. At the same time, the compact<br />
tractor segment (up to approximately 60 hp)<br />
continues to play an important role. In this<br />
class, some new brands which are new to this<br />
region are pushing onto the market. Most of<br />
them are of Chinese or Korean origin. In<br />
contrast to the US market, Indian manufacturers<br />
are still hardly present in Western<br />
Europe.
In the 2007/2008 season, the Western<br />
<strong>European</strong> combine harvester market grew by<br />
3% to almost 6,800 units 3 . <strong>The</strong> larger number<br />
of new machines sold is primarily caused by<br />
the fact that in many countries even smaller<br />
farms bought a new combine after a long<br />
investment break as grain prices and incomes<br />
are higher. Farmers hope that this will reduce<br />
their dependence on contractors. Of course, a<br />
small to medium power segment is sufficient<br />
for this group of customers, which was<br />
reflected by the model range of the manufacturers<br />
in 2007. In the current season, the<br />
market is growing by about 25% to 8,500<br />
units. In France alone, more than 2,500 new<br />
machines will be sold. Thus, it is the second<br />
time that Germany as the former largest<br />
<strong>European</strong> market is considerably exceeded.<br />
<strong>The</strong> world market is going to grow even more.<br />
According to the prognoses of market experts,<br />
approximately 35,000 combines (+32%) will<br />
be sold with South America and the USA as a<br />
growth motor.<br />
Even though the German biogas effect, which<br />
is meanwhile losing in impetus, was one<br />
reason for the forage harvester boom of the<br />
past two season years, the sales of new forage<br />
harvesters is going to keep increasing until<br />
the end of the 2007/2008 season to a global<br />
level of approximately 2,800 units (+20%). In<br />
Germany as the largest market besides the<br />
USA, more than 500 machines will be sold.<br />
Market Volumes for Self Propelled Forage Harvesters<br />
in units<br />
2500<br />
2000<br />
1500<br />
1000<br />
500<br />
0<br />
Source: <strong>VDMA</strong><br />
Germany World<br />
2005 2006 2007<br />
3 <strong>The</strong> market volumes for harvesting machines<br />
mentioned below apply to the so-called western<br />
brands.<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 9<br />
Exhaust emissions and energy efficiency as<br />
fields of technology<br />
<strong>The</strong> technological development of tractors<br />
and motorized agricultural machines is<br />
making fast progress. By the end of 2007,<br />
exhaust emissions stage III A was introduced<br />
with the goal of reducing nitrogen oxide<br />
emissions. This reduction was still able to be<br />
achieved through alterations to the engine<br />
alone, e.g. intercooling, exhaust gas recirculation,<br />
and higher injection pressure.<br />
As of 2010, particle limits will be reduced by<br />
up to 94% in stage III B in comparison with the<br />
current stage. From the current viewpoint,<br />
only particle filters will enable these limits to<br />
be observed. Stage IV, which is planned to go<br />
into effect in 2013, will require a reduction of<br />
nitrogen oxide values by another approximately<br />
88%. This will make the use of<br />
nitrogen oxide adsorption systems or selective<br />
catalytic converters necessary.<br />
<strong>The</strong> exhaust gas regulations of stages III B and<br />
IV mean a challenge for both engine and<br />
machinery manufacturers because not just<br />
the engine alone, but also different components<br />
for exhaust gas aftertreatment and<br />
their conditions of installation play a significant<br />
role in the observation of the exhaust gas<br />
limits. <strong>The</strong> effects of additional exhaust gas<br />
aftertreatment, such as increased fuel<br />
consumption, more noise, higher temperatures,<br />
and additional space requirements for<br />
exhaust gas systems, are going to exert a<br />
significant influence on the future development<br />
of mobile machines.<br />
At the last Agritechnica, tractors with a twotank<br />
system for both biofuels and conventional<br />
fuels were presented. Meanwhile,<br />
however, the use of biofuels rather seems to<br />
be established by quotas of admixture to<br />
conventional diesel than through pure<br />
biodiesel.<br />
<strong>The</strong> agricultural machinery industry is making<br />
constant efforts to improve the energy<br />
efficiency of its machines. One way is the<br />
replacement of the hydraulic drive by an<br />
electric drive system. Concepts with an
10 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
electric drive are meanwhile available for<br />
forage harvesters (Krone), fertilizer spreaders<br />
(Rauch), and tractors (John Deere). <strong>The</strong>y have<br />
the advantage that they can be integrated<br />
into existing components. In addition, they<br />
provide better efficiency and, hence, reduce<br />
overall energy consumption.<br />
In the segment of balers for straw and forage,<br />
the trend towards big square balers for<br />
contractors or large farms is continuing. By<br />
the end of the 2007/2008 season, the<br />
Western <strong>European</strong> market for square balers is<br />
going to grow to approximately 2,200 units<br />
(+16%), while the prognosis for the round<br />
baler market is 13,500 units (+12%). <strong>The</strong><br />
current volume of the world market for big<br />
square balers is about 4,000 units, while<br />
approximately 34,000 round balers from<br />
western brands are bought. In many countries,<br />
the classic high-pressure baler continues<br />
to play an important role. In industrialized<br />
countries, these balers are used on horse<br />
breeding farms, for example.<br />
<strong>The</strong> number of forage harvesting machines<br />
(mowers, turners, and swathers) on the new<br />
machine market remained relatively constant<br />
or grew only slightly in the past years as<br />
compared with more noticeable fluctuations<br />
on the market for other machines. <strong>The</strong> likely<br />
reason for this development is that demand<br />
fluctuations rather tend to cancel each other<br />
out within the large number of small and<br />
medium-sized forage growing farms. In the<br />
past years, the machines have been increasingly<br />
geared towards larger area capacities.<br />
Meanwhile, self-propelled mowers allow<br />
approximately 15 hectares of green area per<br />
hour to be mowed. Afterwards, turners and<br />
swathers with working widths of up to 15<br />
metres process the grass to hay. In<br />
2006/2007, the number of new machines sold<br />
in Western Europe decreased slightly to about<br />
78,000 units. Given the stronger purchasing<br />
power of dairy farms, the market volume is<br />
growing noticeably in the 2007/2008 season.<br />
In Germany alone, the final sales of machines<br />
are likely to increase by approximately 10 to<br />
15% to about 23,000 units. <strong>The</strong> same trend<br />
can be observed in the segment of loader and<br />
harvesting wagons, whose sales figures in<br />
Western Europe amounted to 2,400 units in<br />
2006/2007.<br />
For sprayers, the greatest possible performance<br />
(ha/hour) remains the decisive goal.<br />
Meanwhile, a project of the <strong>VDMA</strong> and the<br />
Julius-Kühn Institute has begun in Germany<br />
which studies the effects of higher driving<br />
speeds on the field on the spreading of plant<br />
protection products. <strong>The</strong> goal is approval for<br />
speeds of 16 km/h and more. <strong>The</strong>re is a<br />
pronounced trend towards self-propelled<br />
sprayers, especially since the price difference<br />
between a self-propelled sprayer and a large<br />
drawn implement has become smaller. In<br />
2007, about 7,800 sprayers were sold in<br />
Western Europe. In 2008, this figure will be<br />
considerably higher.<br />
<strong>The</strong> market for fertilizer spreaders is feeling a<br />
strong momentum. <strong>The</strong> price increases for<br />
mineral fertilizer are at the top of the input<br />
price increases for farmers. <strong>The</strong> more accurate<br />
control of the spread quantity in a new<br />
machine allows the quantity of fertilizer<br />
needed and the costs to be reduced. This<br />
precision is achieved with the aid of more<br />
sensors. This meets the needs of environmental<br />
protection even more and provides<br />
better operating comfort. In 2007, the volume<br />
of the Western <strong>European</strong> fertilizer spreader<br />
market slightly exceeded 20,000 machines.<br />
For 2008, a growth of 20% seems realistic.
In Germany, many automatic milking systems<br />
have been sold in the past two years, while<br />
they had been already widely established in<br />
neighbouring countries some years before.<br />
<strong>The</strong>se systems for medium-sized dairy farms<br />
meanwhile account for one half of the sales of<br />
new machines in Germany. This boom was<br />
also supported by higher milk payouts after<br />
the sales of new systems had been rather<br />
slow in the past years. Structural change in<br />
milk production is continuing, and it is more<br />
pronounced than in arable farming. <strong>The</strong><br />
farmers´ associations in Germany also<br />
demand the consolidation of dairies so that<br />
higher milk prices can be paid out to the<br />
farmers.<br />
In feeding, the feed mixing wagon has<br />
meanwhile firmly established itself. <strong>The</strong>re is a<br />
growing demand for self-propelled feed<br />
mixing wagons. <strong>The</strong> daily use of the machine<br />
generally provides rationalization effects. <strong>The</strong><br />
<strong>VDMA</strong> is accompanying this trend in a quality<br />
association. <strong>The</strong> largest <strong>European</strong> market is<br />
Germany with approximately 2,000 trailed<br />
and self-propelled wagons per year, followed<br />
by France and Italy.<br />
Traditionally, the segment of gardening and<br />
landscaping equipment also belongs to the<br />
agricultural machinery industry. In this field,<br />
the boundaries between the consumer and<br />
the investor market are diffuse. <strong>The</strong> range of<br />
machinery in this segment is very wide and<br />
includes machines for street cleaning, lawn<br />
and green area care as well as gardening or<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 11<br />
hobby agriculture. Estimated market volume<br />
in the <strong>European</strong> Union amounts to € 2 billion,<br />
i.e. approximately 10% of the entire agricultural<br />
machinery market. In the USA, the share<br />
of this segment is considerably higher. Like in<br />
agriculture, business depends on the weather<br />
conditions. An additional influencing factor is<br />
the financial situation of the municipalities<br />
because they are an important group of<br />
customers and often adopt a very reserved<br />
attitude towards investments when government<br />
budgets are tight. Given the good<br />
financial situation in the past three years,<br />
however, more equipment was bought again.<br />
<strong>European</strong> Union: new phenomenon seller´s<br />
market<br />
<strong>The</strong> demand for new and used agricultural<br />
machinery increased in the past four years not<br />
only in the new EU member countries, but<br />
also in Western Europe. While the markets for<br />
agricultural machinery were considered<br />
“saturated“ at the beginning of the new<br />
millenium given the constant structural<br />
change and the high degree of mechanization,<br />
longer delivery times will force many farmers<br />
to work without their ordered new machine<br />
during the 2008 harvest. This is currently the<br />
situation on many <strong>European</strong> markets.<br />
<strong>The</strong>refore, it is less important if individual<br />
markets, such as Italy, remain very weak. It is<br />
forgotten, however, that this means that<br />
agriculture is losing in significance in some<br />
parts of Europe.<br />
Growth rates were generally astounding in<br />
2007 and remain astonishing. This year,<br />
Germany is heading towards a tractor market<br />
volume of more than 30,000 units. In France,<br />
the 2008 grain harvest will take place with as<br />
many new machines as never before in the<br />
past nine years, and a growing demand for<br />
ploughs is stopping the trend of the past years<br />
towards ploughless tillage. <strong>The</strong>se are only<br />
three examples for the currently particularly<br />
dynamic development in Western Europe.<br />
Structural change in agriculture, which results<br />
in a decreasing number of potential customers<br />
for agricultural machinery, is continuing,<br />
but the remaining farmers use their higher
12 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
incomes for investments primarily in order to<br />
expand their capacities.<br />
Currently, the following conditions apply to all<br />
Western <strong>European</strong> and most Central <strong>European</strong><br />
markets:<br />
� <strong>The</strong> sum of agricultural incomes increases<br />
due to the higher producer<br />
prices. <strong>The</strong> extent of the increase depends<br />
on the quality and the quantity of<br />
the harvest as well as the kind of local<br />
agriculture. Recently, it has been difficult<br />
to make money with pork or fruits, for<br />
example, whereas the contribution margin<br />
for rape or grain is significantly<br />
higher than two years ago despite the<br />
higher expenses.<br />
� Due to the new rules of EU agricultural<br />
policy, the mechanisms of the world<br />
market have become more noticeable.<br />
<strong>The</strong>refore, a larger range of fluctuation<br />
in the economic situation of the customers<br />
must be expected. Significant<br />
volatility of the agricultural prices generally<br />
leads to insecurity and dissatisfaction<br />
among farmers. In May and June,<br />
this was illustrated by the massive protest<br />
of <strong>European</strong> dairy farmers against<br />
prices below € 0.40 per kg, for which the<br />
dairies are held responsible.<br />
� <strong>The</strong> agricultural industry has diversified.<br />
<strong>The</strong>refore, the income of the farmers<br />
meanwhile also depends on the development<br />
of bioenergy as their second<br />
source of income.<br />
� <strong>The</strong> overall mood of the customers<br />
(measured in regular surveys carried out<br />
by the Agrarian Investment Barometer,<br />
for example) is good, and the majority of<br />
farmers is optimistic. So far, this has led<br />
to a strong willingness to invest. However,<br />
the higher operating expenses (energy,<br />
fertilizer, and machinery prices) are<br />
a significant burden. Farmers fear that<br />
they might remain the weakest link in<br />
the production chain like in the past,<br />
which may lead to strong resistance.<br />
� In Western Europe, the degree of<br />
mechanization and the level of technology<br />
in agriculture is higher than in other<br />
regions of the world, which not only<br />
makes intensive agriculture more profitable,<br />
but also leaves more space for<br />
longer investment cycles in the economic<br />
downswing phase.<br />
� On sales markets outside the euro zone,<br />
the price pressure on manufacturers<br />
who bill their customers in euros has increased.<br />
Investments in Germany at a record level<br />
In the current upswing phase, the highest<br />
increase will be achieved in the year 2008. By<br />
the end of the year, the market volume for<br />
new machines will have increased by more<br />
than 50% to more than € 4 billion within four<br />
years. According to the Ministry of Agriculture,<br />
investments in machinery and implements in<br />
the business year 2006/2007 amounted to<br />
€ 211 per hectare of area, which equals an<br />
increase by 19%. In 2008, the market is<br />
predicted to grow by 12 to 15%. Farmers<br />
placed their orders earlier than usual and thus<br />
Market Volumes in Germany<br />
in units, referring to the calendar or seasonal year<br />
2004 2005 2006 2007<br />
Tractors 22.141 23.492 29.015 28.451<br />
Combine harvesters 1.874 2.228 2.206 1.937<br />
Balers 2.022 2.214 1.957 2.012<br />
Forage harvesters 358 481 504 499<br />
Mowers 10.280 10.701 10.982 11.261<br />
Tedders and rakes 9.119 9.520 9.614 9.514<br />
Source: <strong>VDMA</strong><br />
reacted to the delivery periods of the manufacturers,<br />
which are three to four months<br />
longer. Until the early summer, the mood in<br />
agriculture remained positive. In addition, pig<br />
breeders, who were under strong price<br />
pressure in 2007, were able to breathe again.<br />
On the other hand, the development of the<br />
milk prices, which rather moved towards<br />
€ 0.30 than € 0.40 per kg again, showed milk<br />
producers that prices do not keep growing<br />
forever. Massive protest made the public<br />
aware of this topic. Since the spring of 2008,<br />
German farmers and contractors have viewed<br />
the situation in a slightly more sceptical<br />
manner again. However, this slightly greater<br />
insecurity is not going to affect the agricul-
tural machinery market in 2008. Growth is<br />
going to be significant, but the increase rate<br />
could be lower again in 2009.<br />
Biogas plants are a topic that has exerted<br />
great influence in the past five years. Primarily<br />
farmers built approximately 3,500 plants, for<br />
which currently at least 250,000 hectares of<br />
maize are cultivated. Meanwhile, a certain<br />
disillusionment with this new business<br />
segment has developed. Even though the<br />
guaranteed compensation for electricity<br />
generated from biomass which is fed into the<br />
mains network remains attractive and is<br />
guaranteed for 20 years, estimated profitability<br />
is lower given higher raw material prices<br />
and considerable expenditures for plant<br />
operation. At least the supply problem was<br />
able to be minimized thanks to a very good<br />
maize harvest in 2007.<br />
Russia´s demand is losing in dynamics<br />
In the past years, sales of new agricultural<br />
machinery in Russia grew quickly. In the year<br />
2007 alone, they grew by 78% to more than<br />
US $ 2.5 billion. In the future, this growth will<br />
be far more moderate. <strong>The</strong> second half of the<br />
year 2008 has dampened the optimism of<br />
Russian farmers. <strong>The</strong>re are numerous reasons<br />
for this development. At the end of 2007, the<br />
prices of some food items had already been<br />
frozen and import tariffs had been imposed<br />
for the most important grain varieties due to<br />
the electoral campaign. First, this did not have<br />
any effect on the expectations of the farmers<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 13<br />
because most of them had already sold their<br />
harvest. In addition, one had assumed that<br />
the export tariffs for grain would be abolished<br />
after the presidential elections during the first<br />
half of the year 2008. In contrast to this<br />
assumption, however, the tariffs were<br />
extended in April.<br />
In addition, the local market seems to have<br />
slightly lost in attractiveness. While prices<br />
(e.g. those of bread) are artificially frozen,<br />
expenses for fuels and fertilizer have grown<br />
significantly. Government subsidy programmes,<br />
such as machinery financing<br />
through RosAgroLeasing, are continuing<br />
without any restrictions. With some exceptions,<br />
the Russian manufacturers are profiting<br />
from these programmes. Financing by private<br />
banks, however, which played a decisive role<br />
in the boom of Russian agriculture in the past<br />
years is continuing only to a limited extent.<br />
<strong>The</strong> refinancing instruments of the banks are<br />
no longer as efficient as before. Experts<br />
believe that this is partly a result of the US<br />
finance crisis and the global scarcity of money.<br />
In addition, profit expectations have decreased<br />
due to political interference. In<br />
contrast to agriculture, the raw material<br />
sector provides more lucrative investment<br />
possibilities due to the exploding prices. This<br />
also applies to the construction sector given<br />
the construction boom in Moscow, St.<br />
Petersburg, and the Black Sea region.<br />
In February, the Russian Ministry of Economy<br />
and Trade initiated a protective procedure<br />
against the significantly higher combine<br />
imports. Both the <strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong><br />
<strong>Association</strong> and the <strong>European</strong> umbrella<br />
organization CEMA are participating actively<br />
in this procedure in order to prevent high<br />
protective tariffs.<br />
Ukraine with unbroken trend towards<br />
investments into modern western machinery<br />
In 2007, sales of western agricultural machinery<br />
in Ukraine continued to increase. Of the<br />
total volume of agricultural machinery<br />
imports in the amount of US $ 790 million,<br />
Germany and the USA each accounted for
14 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
US $ 240 million. Thus, the USA, which was<br />
certainly favoured by the exchange rate,<br />
considerably increased its market share in<br />
Ukraine, while Germany has traditionally been<br />
by far the most important supplier so far.<br />
With a few exceptions, such as Cervona Zirka,<br />
a producer of tillage equipment and seed<br />
drills, the importance of domestic manufacturers<br />
is diminishing. Despite an unstable<br />
political situation characterized by a stalemate<br />
between president Yushchenko and the<br />
old Yanukowich government, subsequent<br />
elections, and a longer process of coalition<br />
formation, imports grew as compared to<br />
2006. Experts believe that this growth would<br />
have been even stronger if the situation had<br />
been more stable. This is now expected for<br />
2008.<br />
<strong>The</strong> discussion about grain export quotas is<br />
continuing. Despite political announcements<br />
stating that the quotas would be abolished<br />
and strong lobbyism of the agricultural<br />
holdings, the government has so far kept the<br />
quotas and increased them only slightly.<br />
<strong>The</strong>re are fears that food prices might explode<br />
if the quotas were waived completely. This<br />
would mean that the majority of the population<br />
would have to struggle for its existence.<br />
Even though the gross domestic product has<br />
constantly increased by approximately 7% in<br />
recent years, more than half of the population<br />
still lives below the poverty line and spends<br />
more than one half of its income on food.<br />
Since the 2008 harvest is expected to be good,<br />
one assumes that the quotas will be abolished<br />
or at least increased significantly.<br />
<strong>The</strong> <strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong> <strong>Association</strong><br />
is advocating the improvement of the<br />
investment conditions for local production<br />
and assembly. In cooperation with the EU<br />
Commission, the reduction of the “local<br />
content” requirements for the granting of<br />
national subsidy programmes from 50% to<br />
30% is being striven for.<br />
Strategically important market Kazakhstan<br />
<strong>The</strong> entire Kazakh agricultural area comprises<br />
223 million ha, of which 24 million ha are<br />
arable land, 5 million ha are cultivated<br />
grassland and meadows, and 189 million ha<br />
are natural grassland and pastures. Currently,<br />
approximately 77 million ha are used for<br />
agriculture, among them 100% of the arable<br />
land.<br />
Arable farms which specialize in grain<br />
cultivation (primarily bread wheat) play the<br />
most important role. Grain accounted for<br />
more than 80% of the entire area cultivated in<br />
the whole country in 2007. According to the<br />
US Department of Agriculture, grain was<br />
cultivated on 15.4 million ha, of which 12.8<br />
million ha were used for wheat cultivation.<br />
<strong>The</strong>re are some smaller farms (by Kazakh<br />
standards), which are between 3,000 and<br />
5,000 hectares in size. <strong>The</strong> agricultural<br />
holdings, which cultivate an area of 20,000 to<br />
200,000 hectares each, are more important. A<br />
few farms have already exceeded the 0.5<br />
million ha limit. <strong>The</strong>se farms use highly<br />
efficient, large-volume machinery as well as<br />
modern, soil-protecting technologies in soil<br />
cultivation, and high-quality seeds.<br />
Financing by public and private organizations<br />
Some sources of financing are available<br />
through KazAgroFinanz, for example. Today,<br />
this organization is the biggest financial<br />
service provider in the agricultural and food<br />
sector of Kazakhstan. <strong>The</strong> current annual<br />
standard interest rate for loan financing<br />
amounts to 4%. Meanwhile, interest subsidies<br />
are also possible for the financing of „western“<br />
imports. In addition to KazAgroFinanz,<br />
there are also several other banks (AstanaFinanz,<br />
Centre Credit, HSBC), which generally<br />
only take over the financing of new machinery.<br />
In 1999, the import regulations for agricultural<br />
machinery were loosened. For some<br />
machines (e.g. combines, tillage equipment,<br />
seed complexes), no tariffs are charged. At the<br />
beginning of 2008, maximum tariffs were<br />
reduced from 15% to 5% (e.g. for all tractors).<br />
Imports are exempt from import sales tax.<br />
Tariff and tax regulations are identical for<br />
new and used machinery.
Given an increasing global price level,<br />
agriculture in Kazakhstan is currently as<br />
attractive as never before.<br />
Impetus for western agricultural machinery<br />
North American manufacturers have a strong<br />
position on the market. <strong>The</strong>ir machinery is<br />
very suitable for the climatic conditions in this<br />
country. In addition, it is robust and has a<br />
simple design. Due to the weak dollar, the<br />
purchasing price of North American machinery<br />
is considerably lower than the price of<br />
competing products from Western Europe.<br />
Approximately two thirds of the total volume<br />
of the imported soil cultivation equipment,<br />
seed drills, and sprayers come from North<br />
America.<br />
Current agricultural successes in Kazakhstan<br />
are regarded as a kind of reference in the<br />
entire region also for agriculture in neighbouring<br />
countries. <strong>The</strong>refore, the kind of machinery<br />
used is observed closely. More than in<br />
Southern or Central Russia, for example,<br />
Western <strong>European</strong> manufacturers must adapt<br />
their machinery to the natural conditions here<br />
in order to successfully compete with Russian<br />
and particularly North American manufacturers.<br />
US farmers keep investing in 2008/2009<br />
2008 is the sixth boom year on the agricultural<br />
machinery market in the USA. By the end<br />
of the year, the leading manufacturers expect<br />
another sales increase of 15 to 20%. This<br />
development is based on good agricultural<br />
incomes. According to estimates of the US<br />
Department of Agriculture, incomes could<br />
increase by 4% to a total amount of US $ 92<br />
billion in 2008, which is 51% above the<br />
average of the past ten years. This is a<br />
fundamental difference between agriculture<br />
and other recessive branches of industry, such<br />
as the construction sector, which is affected<br />
by the downward spiral caused by the real<br />
estate crisis. In the USA, there are slightly<br />
more than 2 million farms with an average<br />
area of 182 hectares. <strong>The</strong> largest 10% of the<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 15<br />
farms with an average of 400 hectares<br />
produce 75% of the national agricultural<br />
product.<br />
In the past weeks, the harvest prognoses had<br />
to be lowered due to heavy floods in some<br />
states around the Mississippi river, among<br />
them Iowa as an important agricultural<br />
region. <strong>The</strong> ratio of use of the cultivated area<br />
has become slightly more balanced again,<br />
whereas 22% more area was used for maize<br />
cultivation in the previous year. As a result,<br />
there was a shortage of grain as an important<br />
export product and soya.<br />
However, the initial level for future growth on<br />
the agricultural machinery market is very<br />
high. In 2007, a record number of 218,600<br />
tractors were sold with particular growth in<br />
the large-power segment. In the first five<br />
months, sales declined by 9% to 86,100 units<br />
so that optimism must still be confirmed by<br />
the sales figures of the coming months.<br />
Figures in the combine segment, however,<br />
remain very good: by May, 15% more new<br />
machines were sold. While in spring the most<br />
optimistic sales expectations have come from<br />
dealers in the Midwest corn belt, Missouri<br />
(Northern Plains), and the northern lake states<br />
region, the heavy floods have changed the<br />
picture totally. But the predominant expectation<br />
for the whole country remains that grain<br />
farmers are likely to cope with the high prices<br />
of operating resources better than livestock<br />
farmers. Regarding the agricultural machinery<br />
market, the supply bottlenecks had a slowing<br />
effect.<br />
Tractor Registrations in the USA<br />
in units<br />
250000<br />
200000<br />
150000<br />
100000<br />
50000<br />
Source: AEM<br />
2000 2001 2002 2003 2004 2005 2006 2007
16 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
Brazil with a very positive investment climate<br />
<strong>The</strong> Brazilian agricultural machinery market is<br />
currently experiencing such a boom that one<br />
could almost overlook the fact that the latest<br />
crisis occurred just two years ago. In 2006, the<br />
combine market dropped to a historical low of<br />
just 1,000 new machines. <strong>The</strong> tractor market<br />
reached its bottom at 17,000 units. For 2008,<br />
a volume of 5,000 combines and 40,000<br />
tractors seems realistic. With the good harvest<br />
in 2007/2008, farmers are likely to have<br />
earned the money for investments.<br />
For years, the government programme<br />
Moderfrota has promoted investments by<br />
financing the purchase of new machines or<br />
tested used machinery. Moderfrota primarily<br />
finances tractors, harvesting machinery, and<br />
machines for the processing of coffee, though<br />
only from Brazilian production. <strong>The</strong> loans at<br />
interest rates between 7.5 and 9.5% are taken<br />
for periods between 48 and 72 months. Other<br />
programmes that play a role are Pronaf for<br />
small farms and Moderinfra for investments<br />
in irrigation systems and storage.<br />
<strong>The</strong> average age of tractors and combines is<br />
five and eight years, respectively. <strong>The</strong> indicated<br />
service life of combines is 10 to 15 years.<br />
In tillage, practically only the direct drilling<br />
technique is applied.<br />
An important agricultural machinery trade<br />
fair is the Agrishow, which will be expanded<br />
to include the topics of bioenergy and<br />
sustainability in the future.<br />
Political tumults in Argentina<br />
Argentina´s economy is largely based on its<br />
agriculture, which holds an important<br />
position on the world market thanks to<br />
favourable climatic conditions and the<br />
resulting highly advantageous cost/yield ratio.<br />
More than 50% of the foreign trade revenues<br />
are provided by the export of agricultural<br />
goods.<br />
<strong>The</strong> current crisis, whose reasons lie within<br />
the country, is therefore all the harder to<br />
understand. Instead of being pleased about<br />
the high world market prices and increasing<br />
the inflow of foreign currencies through a<br />
strong export position, the government<br />
insults the farmers as an egotistical minority<br />
which wants to earn too much money.<br />
Meanwhile, the farmers cannot sell their<br />
products and protested in the streets. What is<br />
the reason for this troubled situation? On<br />
11th March, a government decree raised the<br />
export taxes for soybeans from a remarkable<br />
35% to 44% and the taxes for sunflower seeds<br />
from 32% to 39%. <strong>The</strong> argument was that it<br />
was time to redistribute wealth within the<br />
country and to reduce the inflation caused by<br />
increased food prices by keeping more<br />
products within the country. In fact, food<br />
prices have been increasing in the past<br />
months, which leads to hardship among large<br />
parts of the population. Given the high export<br />
taxes, however, farmers do not see any<br />
incentives to produce more and feel downright<br />
punished by progressively increasing tax<br />
rates while world market prices keep rising.<br />
<strong>The</strong> strike of farmers ended in June after 100<br />
days, as the Parliament started to find a<br />
solution for the topic.<br />
Until the beginning of the political disputes,<br />
the Argentinian agricultural machinery<br />
market showed a very dynamic development.<br />
For 2007, the national associations published<br />
market volume figures of pesos 3.3 billion<br />
(approximately € 690 million) minus an<br />
estimated inflation rate of 18%, which leaves<br />
a real growth of 29% as compared to the<br />
previous year. Combine harvesters accounted<br />
for approximately one third of the market
volume. More than 60% of the imports come<br />
from the neighbouring country Brazil followed<br />
by the USA and the <strong>European</strong> Union. For some<br />
machines, the demand for imports is small<br />
(e.g. direct drills and sprayers). Almost 100% of<br />
these machines are bought from domestic<br />
production.<br />
<strong>Agricultural</strong> <strong>Machinery</strong> Imports of Argentina<br />
Average of the years 2005-2007<br />
Italy<br />
3%<br />
Germany<br />
7%<br />
USA<br />
21%<br />
China<br />
2%<br />
Others<br />
2%<br />
Brazil<br />
65%<br />
Source: National statistics agencies, total of the exports of 42<br />
countries to Argentina<br />
<strong>The</strong> future development of the market in<br />
Argentina will depend on the solution of the<br />
tax conflict. In the first months of 2008,<br />
machinery exports to Argentina still increased<br />
considerably. In the medium run, the good<br />
fundamental conditions for agriculture will<br />
probably be predominant so that the investment<br />
volume will remain at its high level. <strong>The</strong><br />
new Expoagro, a merger of the former two<br />
leading trade fairs, has established itself as<br />
the most important trade fair.<br />
India: Largest tractor market of the world<br />
According to information provided by the<br />
national associations, the size of the Indian<br />
agricultural machinery market is approximately<br />
€ 2.2 billion. By 2011, an increase by<br />
more than two thirds to € 3.8 billion is<br />
expected given India´s pronounced need to<br />
catch up with other agricultural nations. It is<br />
mentioned that the Indian farmers had<br />
learned to adapt to new technologies and<br />
would like to use their incomes for investments.<br />
With regard to a constant rural<br />
exodus, which results in reduced manpower<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 17<br />
potential in rural areas and higher political<br />
pressure with regard to reliable food supply,<br />
modern machines are meanwhile meeting<br />
with great acceptance.<br />
Tractors account for 85% of the Indian market<br />
volume<br />
In 2007, the tractor market had a volume of<br />
approximately 325,000 units or € 1.9 billion in<br />
terms of value. <strong>The</strong> volume of the market for<br />
combines and tillage equipment amounted to<br />
only € 44 million. If the other harvesting<br />
machines and tillage implements are included,<br />
sales reached about € 300 million.<br />
<strong>The</strong> growing demand in individual segments<br />
of the agricultural machinery market is based<br />
on different factors. <strong>The</strong> tractor market will<br />
continue to grow because, very generally<br />
speaking, tractor use for work such as drilling,<br />
plant protection, harvesting, as well as<br />
drainage, irrigation, and the wood harvest, is<br />
going to increase. For cultivators, high<br />
subsidies are available in poorly mechanized<br />
states. A large number of sprayers is sold to<br />
small farmers, though generally in the form of<br />
knapsack sprayers.<br />
When seeking access to the Indian market,<br />
manufacturers of western machinery must<br />
consider that foreign brands are generally not<br />
very well known and that the search for a<br />
dealer can be difficult. A very good<br />
price/performance ratio is the main purchasing<br />
criterion. Import tariffs amount to 7.5% for<br />
agricultural machines, 10% for tractors, and<br />
24% for small tractors. Additional fees must<br />
be added to these rates, which therefore<br />
generally increase by 50%. Given the desired<br />
mechanization, however, the authorities<br />
waive import tariffs in some cases. Moreover,<br />
companies have the possibility to establish<br />
themselves in special free trade areas.<br />
<strong>The</strong> most important agricultural machinery<br />
trade fairs in India are the Agrotech in<br />
Changdigarh and the Agriintex in Coimbatore.
18 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
Great challenges for agriculture in China<br />
<strong>The</strong> People´s Republic of China is facing the<br />
greatest agricultural challenge of its history.<br />
<strong>The</strong> economy of this most populous nation of<br />
the world with its population of 1.3 billion<br />
grew by an average of 9% in the past years.<br />
<strong>The</strong>refore, the gross domestic product is<br />
meanwhile eight times as high as in 1992.<br />
During this time, the purchasing power of the<br />
population increased fivefold. As compared<br />
with a Western <strong>European</strong>, the Chinese<br />
consumer still spends a relatively large<br />
percentage of his income on food. <strong>The</strong> eating<br />
habits of the Chinese are changing, in<br />
particular in the cities.<br />
<strong>The</strong> only solution to the growing bottleneck in<br />
food and feedstuff supply is more efficient<br />
agriculture because the largest part of the<br />
agricultural area is cultivated by extremely<br />
small farms with one to two hectares. <strong>The</strong>se<br />
structures do not permit efficient agriculture.<br />
However, large farms in the north-eastern<br />
provinces Heilongjiang, Jilin, and Inner<br />
Mongolia prove that alternatives are available.<br />
<strong>The</strong>se provinces are relatively sparsely<br />
populated and allowed large farms to<br />
develop. On primarily state-owned and a few<br />
private farms, the wider use of modern<br />
machinery, the use of high-quality seeds, and<br />
efficient farm management allowed yields to<br />
be increased, and the potential is far from<br />
being exhausted.<br />
Granary in the north of the country<br />
Large state-owned and a few large private<br />
farms (> 500 hectares) only exist in the northeast<br />
(in the provinces Heilongjiang, Jilin, and<br />
Liaoning), in the north-west (Xinjiang, Gansu),<br />
and Inner Mongolia. In these regions, primarily<br />
grain (mainly wheat and maize), potatoes,<br />
as well as sugar beet and cotton (in Xinjiang)<br />
are grown. <strong>The</strong>se regions are a kind of granary<br />
for the People´s Republic of China. <strong>The</strong> largest<br />
part of the agricultural production is sold in<br />
the economically strong, densely populated<br />
regions. <strong>The</strong> farms cultivate large areas and<br />
strive for maximum profitability. Even though<br />
they make their investment decisions<br />
themselves, they are dependent on the local<br />
administration. <strong>The</strong>y generally also purchase<br />
their machinery from the large regional<br />
dealers.<br />
<strong>The</strong> role of the cooperatives is slighlty more<br />
unclear. In the more densely populated<br />
coastal regions and the southern provinces<br />
Yunnan, Sichwan, and Guanxi, they are likely<br />
to have more important functions. <strong>The</strong>se are<br />
excellent regions for rice, fruit, and vegetable<br />
cultivation because they allow several<br />
harvests per year. <strong>The</strong>y can provide good<br />
yields and have the means for the purchase of<br />
machinery. Since they generally also have only<br />
smaller farms, the cooperative form suggests<br />
itself. <strong>The</strong>se cooperatives also buy their<br />
machinery from regional dealers.<br />
<strong>The</strong> enormous currency reserves of the<br />
People´s Republic of China lead to a growing<br />
danger of inflation. <strong>The</strong> Ministry of Trade is<br />
currently examining the possibility of using<br />
some of these reserves for the import of<br />
machinery for which no local production<br />
exists. <strong>The</strong> new representative office of the<br />
<strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong> <strong>Association</strong> in<br />
Beijing serves to develop and expand a<br />
network which includes the above-mentioned<br />
regional dealers as well as government<br />
representatives and local associations.
<strong>Agricultural</strong> <strong>Machinery</strong> in the <strong>European</strong> Union<br />
Values in Million Euro, including tractors<br />
Production Exports<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 19<br />
Country 2005 2006 2007 % 2005 2006 2007 %<br />
Germany 4722 5193 6061 17% 3350 3624 4493 24%<br />
France 2772 2931 3248 11% 1901 2050 2255 10%<br />
Italy 4970 4852 5006 3% 2979 3089 3294 7%<br />
United Kingdom 1905 2019 2113 5% 1376 1468 1598 9%<br />
Spain 548 583 643 10% 272 299 412 38%<br />
Netherlands 583 627 712 14% 890 1168 1372 18%<br />
Denmark 566 584 665 14% 445 530 653 23%<br />
Austria 963 1022 1143 12% 699 791 931 18%<br />
Finland 1089 1108 1253 13% 627 660 764 16%<br />
Belgium-Luxembourg 542 528 629 19% 1075 1003 1192 19%<br />
Ireland 133 155 180 16% 102 117 134 14%<br />
Sweden 291 330 390 18% 383 424 560 32%<br />
Greece 32 38 43 13% 25 27 31 16%<br />
Portugal 65 64 74 17% 20 21 30 42%<br />
EU 15* 19181 20034 22159 11% 5864 6541 7646 17%<br />
Poland 480 563 630 12% 320 414 478 15%<br />
Czech Republic 320 414 491 19% 301 349 410 18%<br />
Hungary 299 307 337 10% 272 319 353 11%<br />
Romania 59 67 61 -10% 34 41 29 -31%<br />
Bulgaria 13 15 17 15% 6 11 13 21%<br />
Rest of new EU members 129 146 184 26% 158 213 325 53%<br />
EU 12* (Entry 2004 and 2006) 1300 1512 1720 14% 563 695 724 4%<br />
EU 27* 20481 21547 23879 11% 4983 5453 6122 12%<br />
Imports Market Volume<br />
Country 2005 2006 2007 % 2005 2006 2007 %<br />
Germany 1579 1778 2121 19% 2950 3347 3689 10%<br />
France 2324 2391 2692 13% 3195 3272 3685 13%<br />
Italy 606 642 704 10% 2597 2405 2416 0%<br />
United Kingdom 1283 1465 1715 17% 1812 2017 2230 11%<br />
Spain 798 804 1026 28% 1074 1088 1257 15%<br />
Netherlands 605 708 868 23% 710 814 997 22%<br />
Denmark 649 780 971 24% 770 834 983 18%<br />
Austria 502 537 647 21% 766 768 859 12%<br />
Finland 286 275 324 18% 749 723 813 12%<br />
Belgium-Luxembourg 953 939 1080 15% 421 464 517 11%<br />
Ireland 325 377 466 24% 356 415 512 24%<br />
Sweden 428 492 599 22% 336 398 429 8%<br />
Greece 178 181 232 28% 185 192 244 27%<br />
Portugal 167 168 183 9% 212 211 228 8%<br />
EU 15* 2443 2629 2943 12% 16132 16948 18858 11%<br />
Poland 489 607 789 30% 649 755 941 25%<br />
Czech Republic 313 396 505 28% 332 460 585 27%<br />
Hungary 232 257 382 49% 258 245 366 49%<br />
Romania 148 268 219 -18% 173 294 251 -15%<br />
Bulgaria 89 86 137 59% 96 90 141 56%<br />
Rest of new EU members 605 689 863 25% 575 622 722 16%<br />
EU 12* (Entry 2004 and 2006) 1679 2075 2569 24% 2083 2468 3006 22%<br />
EU 27* 2111 2253 2442 8% 18215 19415 21864 13%<br />
* excluding intra trade<br />
Some countries including transfers (e.g. Netherlands, Belgium - reason for exports exceeding production)<br />
Sources: Eurostat, <strong>VDMA</strong> (incl. own calculations and estimation production 2007), CEMA
20 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
Exports of <strong>Agricultural</strong> Machines and Tractors Worldwide<br />
Share of total volume in % (2007)<br />
25%<br />
20%<br />
15%<br />
10%<br />
5%<br />
0%<br />
Germany<br />
USA<br />
Italy<br />
France<br />
Netherlands<br />
China<br />
Belgium<br />
Canada<br />
Denmark<br />
Austria<br />
United Kingdom<br />
Brazil<br />
<strong>Agricultural</strong> Machines Tractors<br />
Imports of <strong>Agricultural</strong> Machines and Tractors Worldwide<br />
Share of total volume in % (2007)<br />
25%<br />
20%<br />
15%<br />
10%<br />
5%<br />
0%<br />
USA<br />
France<br />
Germany<br />
Russia<br />
Canada<br />
United Kingdom<br />
Belgium<br />
Denmark<br />
Netherlands<br />
Spain<br />
Poland<br />
Sweden<br />
Poland<br />
Spain<br />
Finland<br />
Hungary<br />
Japan<br />
Mexico<br />
<strong>Agricultural</strong> Machines Tractors<br />
Source: official national statistics, <strong>VDMA</strong>, total of the ex- or imports from 42 countries<br />
Austria<br />
Italy<br />
Sweden<br />
Mexico<br />
Czech Republic<br />
Ireland<br />
Norway<br />
Czech Republic<br />
Hungary<br />
Russia<br />
Ireland<br />
Japan<br />
South Korea<br />
Finland<br />
Others<br />
Switzerland<br />
Turkey<br />
Turkey
Origin of <strong>Agricultural</strong> <strong>Machinery</strong> Imports of Selected Countries<br />
Average of the years 2005-2007<br />
Brazil Russia*<br />
Totals in Mn. Euro:<br />
2005: 658.5<br />
2006: 1121.8<br />
2007: 1707.5<br />
Totals in Mn. Euro:<br />
2005: 79.3<br />
2006: 85.3<br />
2007: 175.1<br />
Others<br />
24%<br />
Others<br />
23%<br />
Germany<br />
32%<br />
USA<br />
47%<br />
Netherlands<br />
3%<br />
Belgium<br />
4%<br />
France<br />
4%<br />
Germany<br />
4%<br />
Finland<br />
4%<br />
Netherlands<br />
4%<br />
Italy<br />
5%<br />
USA<br />
18%<br />
Canada<br />
6%<br />
Sweden<br />
6%<br />
Ukraine<br />
8%<br />
Argentina<br />
8%<br />
* without imports from Belarus<br />
India China<br />
Totals in Mn. Euro:<br />
2005: 217.0<br />
2006: 201.6<br />
2007: 218.7<br />
Totals in Mn. Euro:<br />
2004: 23.8<br />
2005: 36.0<br />
2006: 45.4<br />
USA<br />
24%<br />
Others<br />
23%<br />
China<br />
26%<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 21<br />
Others<br />
32%<br />
United Kingdom<br />
3%<br />
France<br />
4%<br />
Italy<br />
16%<br />
Netherlands<br />
3%<br />
Japan<br />
20%<br />
Italy<br />
4%<br />
Japan<br />
6%<br />
South Korea<br />
9%<br />
Germany<br />
13%<br />
USA<br />
10%<br />
Germany<br />
7%<br />
2007 data not available<br />
Source: National Statistics Agencies
22 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
Destinations of <strong>Agricultural</strong> <strong>Machinery</strong> Exports of Selected Countries<br />
Average of the years 2005-2007<br />
Brazil Russia*<br />
Totals in Mn. Euro:<br />
2005: 144.0<br />
2006: 126.4<br />
2007: 164.9<br />
Others<br />
10%<br />
Lithuania<br />
2%<br />
Uzbekistan<br />
2%<br />
Totals in Mn. Euro:<br />
2005: 822.3<br />
2006: 715.1<br />
2007: 939.2<br />
Argentina<br />
28%<br />
Turkey<br />
3%<br />
Others<br />
32%<br />
Kyrgyzstan<br />
3%<br />
Azerbaijan<br />
3%<br />
Kazakhstan<br />
51%<br />
Venezuela<br />
11%<br />
Ukraine<br />
26%<br />
Chile<br />
3%<br />
South Africa<br />
4%<br />
USA<br />
9%<br />
Paraguay<br />
7%<br />
Mexico<br />
6%<br />
* without imports from Belarus<br />
India China<br />
Totals in Mn. Euro:<br />
2005: 731.6<br />
2006: 917.2<br />
2007: 1320.2<br />
USA<br />
19%<br />
Totals in Mn. Euro:<br />
2004: 61.2<br />
2005: 146.6<br />
2006: 212.2<br />
Others<br />
26%<br />
Germany<br />
8%<br />
USA<br />
47%<br />
Others<br />
53%<br />
Ghana<br />
3%<br />
Japan<br />
6%<br />
Turkey<br />
4%<br />
United Kingdom<br />
4%<br />
Australia<br />
4%<br />
Thailand Sri Lanka<br />
4% 8%<br />
Nigeria<br />
4%<br />
Bangladesh<br />
4%<br />
Bangladesh<br />
Thailand 3%<br />
3%<br />
2007 data not available<br />
Source: National Statistics Agencies
Companies and Employees<br />
in the German <strong>Agricultural</strong> <strong>Machinery</strong> Industry<br />
Development of the number of employees - long-term and in the course of the past years<br />
80000<br />
70000<br />
60000<br />
50000<br />
40000<br />
30000<br />
20000<br />
10000<br />
0<br />
1950 1960 1970 1980 1990 2000<br />
Current number of enterprises: 206, number of employees: 27.000<br />
30000<br />
28000<br />
26000<br />
24000<br />
22000<br />
20000<br />
Source: Federal German Statistics Agency, total for companies > 20 employees<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 23<br />
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007<br />
German Market Volume for <strong>Agricultural</strong> <strong>Machinery</strong> by Segments<br />
Value in 1,000 Euro<br />
Kind of machinery<br />
2005 2006 2007 %-change<br />
Tractors 853.569 1.032.453 1.232.201 19,3%<br />
Soil Working Equipment 114.563 135.745 149.660 10,3%<br />
Machines for sowing, plant protection and fertilising 111.782 128.559 122.856 -4,4%<br />
Harvesting machinery 578.749 653.956 621.118 -5,0%<br />
Equipment for husbandry 138.381 146.486 177.913 21,5%<br />
Conveyor equipment for agriculture 43.164 44.623 53.389 19,6%<br />
Trailers for agricultural use 53.953 65.804 68.544 4,2%<br />
Other machinery* 1.001.223 1.139.054 1.263.181 10,9%<br />
Total 2.895.384 3.346.680 3.688.862 10,2%<br />
Sources: Turnover Statistics <strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong>, Federal German Statistic Agency, * incl. parts, lawn and<br />
garden maintenance, forest equipment, repair, others
24 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
<strong>Agricultural</strong> Key Figures of the Biggest Agrarian Nations<br />
Surface (in 1000 ha) <strong>Agricultural</strong> Production (Mn. tons) <strong>Agricultural</strong> Exports (Mn. USD)<br />
Meat Cereals 1999-2001 2003 2004<br />
Pastures Fruits and<br />
vegetables<br />
Arable land Permanent<br />
crop<br />
Total country<br />
area<br />
15.839<br />
20.871<br />
114<br />
27.215<br />
20.574<br />
20.827<br />
1.314<br />
46.642<br />
39.240<br />
3.585<br />
7.058<br />
9.401<br />
1.427<br />
24.424<br />
693<br />
9.879<br />
379<br />
487<br />
1.254<br />
2.051<br />
6.679<br />
765<br />
2.197<br />
3.421<br />
24.294<br />
11.926<br />
5.958<br />
3.415<br />
21.185<br />
63.893<br />
3.312<br />
604.329<br />
13.867<br />
15.173<br />
103<br />
20.914<br />
17.598<br />
20.460<br />
938<br />
42.127<br />
32.847<br />
3.231<br />
6.504<br />
6.992<br />
1.600<br />
20.645<br />
733<br />
8.725<br />
419<br />
612<br />
1.234<br />
1.953<br />
4.160<br />
603<br />
2.339<br />
2.937<br />
21.442<br />
10.284<br />
4.831<br />
2.722<br />
17.192<br />
62.305<br />
2.488<br />
523.885<br />
34.086 10.873<br />
36.586 15.271<br />
40.960<br />
107<br />
65.632 14.215<br />
51.429 15.878<br />
394.644 16.648<br />
20.998<br />
575<br />
62.737 33.844<br />
45.262 23.836<br />
12.754 2.276<br />
232.883 4.942<br />
64.169 4.815<br />
21.370 1.031<br />
20.566 15.737<br />
13.536<br />
577<br />
31.533 7.385<br />
24.493<br />
380<br />
22.700<br />
415<br />
29.637 1.093<br />
19.013 1.447<br />
26.513 2.558<br />
18.638<br />
433<br />
70.897<br />
935<br />
12.088 2.151<br />
23.080 14.179<br />
29.849 7.285<br />
32.428 3.975<br />
30.329 1.810<br />
21.771 15.256<br />
368.981 55.293<br />
38.523 2.260<br />
2.178.067 414.279<br />
3.968<br />
3.811<br />
449<br />
19.154<br />
4.404<br />
72.730<br />
1.404<br />
6.331<br />
6.700<br />
1.124<br />
5.986<br />
2.308<br />
1.634<br />
4.049<br />
715<br />
4.955<br />
595<br />
1.054<br />
1.882<br />
2.336<br />
3.372<br />
963<br />
4.963<br />
1.868<br />
5.505<br />
2.014<br />
1.538<br />
1.660<br />
3.270<br />
38.901<br />
2.573<br />
256.893<br />
99.867 10.745<br />
404.900 5.302<br />
600 3.585<br />
196.206 43.905<br />
15.435 3.180<br />
400.001 497.664<br />
-<br />
23.682<br />
10.124 19.050<br />
5.048 8.037<br />
1.051 3.511<br />
11.040 127.100<br />
11.177 21.378<br />
44.000 26.629<br />
4.353 32.083<br />
185.098 2.888<br />
80.000 24.717<br />
314 5.557<br />
39.200 17.405<br />
5.000 9.717<br />
1.500 17.426<br />
4.083 8.565<br />
4.949 7.453<br />
90.924 19.302<br />
83.928 7.833<br />
11.462 29.923<br />
800 11.127<br />
12.378 36.704<br />
7.910 8.771<br />
11.036 2.848<br />
234.000 67.642<br />
642 12.990<br />
3.442.078 1.364.353<br />
1.000<br />
296<br />
400<br />
7.560<br />
6.368<br />
11.533<br />
490<br />
1.142<br />
216<br />
201<br />
9.200<br />
13.100<br />
2.002<br />
2.805<br />
136<br />
2.500<br />
589<br />
2.650<br />
658<br />
5.000<br />
337<br />
527<br />
1.864<br />
959<br />
4.904<br />
3.380<br />
2.553<br />
932<br />
52<br />
2.050<br />
1.938<br />
135.821<br />
27.800<br />
50.304<br />
8.084<br />
57.640<br />
45.810<br />
137.124<br />
2.801<br />
18.440<br />
11.804<br />
4.602<br />
160.555<br />
20.500<br />
14.324<br />
8.479<br />
21.535<br />
24.800<br />
9.909<br />
28.200<br />
21.302<br />
5.650<br />
13.993<br />
9.381<br />
124.374<br />
14.753<br />
13.400<br />
15.865<br />
23.826<br />
32.564<br />
5.876<br />
176.018<br />
6.200<br />
1.397.656<br />
Argentina 273.669<br />
Australia 768.230<br />
Bangladesh 13.017<br />
Brazil 845.942<br />
Canada 909.351<br />
China 932.742<br />
Egypt 99.545<br />
France 55.010<br />
Germany 34.895<br />
Hungary 9.211<br />
India 297.319<br />
Indonesia 181.157<br />
Iran 163.620<br />
Italy 29.411<br />
Kazakhstan 269.970<br />
Mexico 190.869<br />
Myanmar / Birma 65.755<br />
Nigeria 91.077<br />
Pakistan 77.088<br />
Philippines 29.817<br />
Poland 30.436<br />
Romania 22.971<br />
Russian Federation 1.638.134<br />
South Africa 121.447<br />
Spain 49.900<br />
Thailand 51.089<br />
Turkey 76.963<br />
Ukraine 57.935<br />
United Kingdom 24.193<br />
United States of America 915.896<br />
Viet Nam 32.549<br />
World 13.004.202<br />
A bold figure means: this country is among the TOP 10 countries worldwide for the corresponding item.<br />
Source: FAO, area figures refering to the year 2000, production figures: year 2003/2004
Members of <strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong><br />
Company Webpage Tractors<br />
Trailers /<br />
Transport<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 25<br />
AG-Chem Europe BV www.agchemeurope.com �<br />
AGCO GmbH www.fendt.com � �<br />
AGCO Vertriebs GmbH www.masseyferguson.de �<br />
Agria-Werke GmbH www.agria.de �<br />
AGROCOM GmbH & Co. Agrarsystem KG www.agrocom.com �<br />
Ahlmann Baumaschinen GmbH www.ahlmann.com �<br />
ALLWEILER AG www.allweiler.de � �<br />
ALÖ Deutschland Vertriebs-GmbH www.alo-deutschland.de �<br />
AMAZONEN-WERKE H. Dreyer GmbH & Co. KG www.amazone.de � � � �<br />
AUTOKÜHLER GmbH & Co. KG www.akg-gruppe.de �<br />
Röhren- und Pumpenwerk Bauer Gesellschaft m.b.H. www.bauer-online.com � �<br />
Beinlich Agrarpumpen und —maschinen GmbH www.beinlich-beregnung.de � �<br />
BELIMPEX-Handels GmbH www.belimpex.de �<br />
Ludwig Bergmann GmbH www.l-bergmann.de � �<br />
BONDIOLI & PAVESI GmbH www.bypy.de �<br />
Bosch Rexroth AG www.boschrexroth.de �<br />
BPW Bergische Achsen KG www.bpw.de �<br />
BRILL GLORIA Haus- und Gartengeräte GmbH www.gloriagarten.de �<br />
BSK Plast Pack & Agrarservice und Trade GmbH www.bsk-ast.de �<br />
BUCHER HYDRAULICS GmbH www.bucherhydraulics.com �<br />
Th. Buschhoff GmbH & Co. www.buschhoff.de �<br />
Bernard van Lengerich Maschinenfabrik GmbH & Co. KG www.bvl-group.de �<br />
Caterpillar Motoren GmbH & Co. KG www.cat.com �<br />
CLAAS KGaA mbH www.claas.com � � �<br />
Claas Industrietechnik GmbH www.claas-cit.com �<br />
CNH Deutschland GmbH www.cnh.com � �<br />
Continental Teves AG & Co. oHG www.contiteves.de �<br />
CRAMER GmbH www.cramer-technik.de � �<br />
Daimler AG - Mercedes-Benz Werk Gaggenau www.daimlerchrysler.de �<br />
Herbert Dammann GmbH www.dammann-technik.de �<br />
DANAGRI Deutschland GmbH & Co. KG www.danagri.de � �<br />
John Deere Vertrieb www.deere.com � � � � � �<br />
DES Diesel Exhaust Systems GmbH www.des-systems.com �<br />
DEUTZ AG www.deutz.de �<br />
Dickey-john Europe S.A. www.dickey-john.eu �<br />
Gerhard Dücker KG www.duecker.de � �<br />
Franz Eisele & Söhne GmbH & Co. KG www.eisele.de � �<br />
Emitec Gesellschaft für Emissionstechnologie mbH www.emitec.com �<br />
EPL EGENOLF Prüftechnik Leipzig GmbH www.epl-prueftechnik.de �<br />
ESM Ennepetaler Schneid- und Mähtechnik GmbH & Co. KG www.esm-ept.de � �<br />
Faresin Deutschland GmbH www.faresin.de �<br />
FELLA-Werke GmbH www.fella-werke.de �<br />
Fendt Fördertechnik GmbH www.fendt.foerdertechnik.de � �<br />
Fliegl Agrartechnik GmbH www.fliegl.com �<br />
Flötzinger Gerätetechnik GmbH www.floetzinger-geraetetechnik.de �<br />
FRANK Walz- und Schmiedetechnik GmbH www.frank-wst.de �<br />
Freudenberg Dichtungs- und Schwingungstechnik GmbH www.freudenberg-ds.de �<br />
Frielinghaus GmbH www.frielinghaus.de �<br />
FRITZMEIER Systems GmbH & Co. KG www.fritzmeier.de �<br />
CARL GERINGHOFF Vertriebsgesellschft mbH www.geringhoff.de �<br />
GKN Walterscheid GmbH www.walterscheid.com �<br />
Friedrich Graepel AG www.graepel.de �<br />
GRAMMER AG www.grammer.com �<br />
Grasdorf - Wennekamp GmbH www.grasdorf-wennekamp.de �<br />
Grimme Landmaschinenfabrik GmbH & Co. KG www.grimme.de �<br />
Hako-Werke GmbH www.hako-werke.de � � �<br />
HARDI GmbH www.hardi-international.com �<br />
Kalkwerk Hufgard GmbH www.hufgard.de �<br />
HYDAC TECHNOLOGY GmbH www.hydac.com �<br />
IFA-Maschinenbau GmbH www.ifa-gruppe.de �<br />
ifm electronic gmbh www.ifm-electronic.com �<br />
IMPULSA AG www.impulsa-ag.de �<br />
INTER CONTROL Hermann Köhler Elektrik GmbH & Co. KG www.intercontrol.de �<br />
INTERKAT Katalysatoren GmbH www.interkat.com �<br />
ISEKI-Maschinen GmbH Deutschland www.iseki.de � �<br />
Isringhausen GmbH & Co. KG www.isri.de �<br />
JCB Deutschland GmbH www.jcb.com � � �<br />
Jensen Service GmbH www.holzhackmaschinen.com �<br />
Jetter Aktiengesellschaft www.jetter.de �<br />
Maschinenfabrik KEMPER GmbH & Co. KG www.kemper-stadtlohn.de � �<br />
Dipl.-Ing. Georg Kersten Maschinenfabrik www.kersten-maschinen.de � �<br />
Livestock<br />
Soil Working<br />
Sowing<br />
Fertilizing<br />
Plant Protection<br />
Harvest<br />
Lawn and Garden<br />
Components<br />
Others
26 <strong>VDMA</strong> AGRICULTURAL MACHINERY 2008<br />
Members of <strong>VDMA</strong> <strong>Agricultural</strong> <strong>Machinery</strong><br />
Company Webpage Tractors<br />
Köckerling GmbH & Co. KG www.koeckerling.de � �<br />
Komptech GmbH www.komtech.com �<br />
Köppl GmbH www.koeppl-motorgeraete.de �<br />
Kramer-Werke GmbH www.kramer.de �<br />
Maschinenfabrik Bernard Krone GmbH www.krone.de �<br />
Kubota (Deutschland) GmbH www.kubota.de � �<br />
KUHN MASCHINEN-VERTRIEB GMBH www.kuhn.de � � � �<br />
Kverneland Group Deutschland GmbH www.kvernelandgroup.com � � � � �<br />
Landini Deutschland Agro GmbH www.landini-gmbh.de �<br />
LECHLER GmbH www.lechler.de �<br />
Lely Industries N.V. www.lely.com � �<br />
Lely Deutschland M.R.S. GmbH www.lely.com �<br />
LEMKEN GmbH & Co. KG www.lemken.com � � �<br />
MAN Nutzfahrzeuge AG www.man-nutzfahrzeuge.de �<br />
MANITOU Deutschland GmbH www.manitou.com �<br />
Maschio Deutschland GmbH www.maschio.de �<br />
matev GmbH www.matev.org �<br />
Merlo Deutschland GmbH www.merlo.de �<br />
MESTO Spritzenfabrik Ernst Stockburger GmbH www.mesto.de �<br />
MSR Dosiertechnik GmbH www.msr-dosiertechnik.de �<br />
MTD MOTORGERÄTE GMBH www.mtdeurope.com �<br />
Müller-Elektronik GmbH & Co.KG www.mueller-elektronik.de �<br />
MX GmbH www.m-x.fr �<br />
NIEMEYER Agrartechnik GmbH www.niemeyerweb.de �<br />
OSB AG www.osb-ag.de �<br />
Alois Pöttinger Maschinenfabrik GmbH www.poettinger.at � �<br />
Pumpenfabrik Wangen GmbH www.wangen.com �<br />
RABE Agri GmbH www.rabe-agri.eu � �<br />
Rapid Technic AG www.rapid.ch �<br />
Rauch Landmaschinenfabrik GmbH www.rauch.de � �<br />
Reform-Werke Bauer & Co Gesellschaft m.b.H. www.reform-werke.at � �<br />
Reichhardt GmbH www.reichhardt.org �<br />
ROTH Motorgeräte GmbH & Co. www.roco.de �<br />
RTS GmbH www.riegger-rts.de �<br />
SAME DEUTZ-FAHR Deutschland GmbH www.deutz-fahr.de �<br />
SAUER-DANFOSS GmbH & Co. OHG www.sauer-danfoss.de �<br />
Schanzlin Traktoren und Maschinen GmbH www.schanzlin.de �<br />
Schmidt GmbH www.schmidt-auma.de � �<br />
Schmotzer Agrartechnic GmbH www.schmotzer.de � �<br />
Schuitemaker Machines B. V. www.schuitemaker.nl � � �<br />
Gebr. Schumacher GmbH www.gebruederschumacher.de �<br />
SGARIBOLDI Deutschland Schneider KG www.sgariboldi.de �<br />
SHW SCHMIEDETECHNIK GmbH & Co. KG www.shw-fr.de �<br />
Sontheim Industrie Elektronik GmbH www.s-i-e.de �<br />
SPRAYING SYSTEMS Deutschland GmbH www.spray.de �<br />
Wilhelm Stoll Maschinenfabrik GmbH www.jf-stoll.com �<br />
B. Strautmann & Söhne GmbH & Co. KG www.strautmann.com �<br />
SUEVIA HAIGES GmbH www.suevia.com �<br />
Sulky-Burel www.Sulky-Burel.com � � �<br />
TECNOMA TECHNOLOGIES SAS www.tecnoma.com �<br />
TeeJet Bomlitz www.teejet.com �<br />
THIELE GmbH + Co. KG www.thiele.de � �<br />
Thomas Magnete GmbH www.thomas-magnete.com �<br />
Julius Tielbürger GmbH & Co.KG www.tielbuerger.de �<br />
Gebr. Tigges GmbH & Co. KG www.tigges.com �<br />
Trelleborg Wheel Systems GmbH www.trelleborg.com �<br />
Trioliet Mullos B.V. www.trioliet.nl �<br />
Valtra Vertriebs GmbH www.valtra.de �<br />
Vector Informatik GmbH www.vector-informatik.de �<br />
VETTER Umformtechnik GmbH www.vetter-forks.com �<br />
VOSS Fluid GmbH www.voss.de �<br />
Wachendorff Elektronik GmbH & Co. KG www.wachendorff.de �<br />
Walker-Technik GmbH & Co. KG www.walker-technik.de �<br />
Hans Wanner GmbH www.wanner-maschinenbau.de �<br />
WEBER-HYDRAULIK GMBH www.weber.de �<br />
WELGER Maschinenfabrik GmbH www.welger.com �<br />
WERNER GMBH www.werner-trier.com �<br />
WestfaliaSurge Deutschland GmbH www.westfaliasurge.com �<br />
Wiedenmann GmbH www.wiedenmann.de �<br />
WIKA Alexander Wiegand GmbH & Co. KG www.wika.de �<br />
WTK-Elektronik GmbH www.wtk-elektronik.de �<br />
Zetor Deutschland GmbH www.zetor.de �<br />
ZF Friedrichshafen AG www.zf-group.de �<br />
ZF Passau GmbH www.zf.com �<br />
Status: June 2008<br />
Trailers /<br />
Transport<br />
Livestock<br />
Soil Working<br />
Sowing<br />
Fertilizing<br />
Plant Protection<br />
Harvest<br />
Lawn and Garden<br />
Components<br />
Others
Imprint<br />
Editors<br />
Gerd Wiesendorfer<br />
Alexander Haus<br />
Dagmar Häser<br />
Design and Layout<br />
<strong>VDMA</strong> DesignStudio<br />
Print<br />
h. reuffurth gmbh<br />
Mühlheim am Main<br />
<strong>VDMA</strong> AGRICULTURAL MACHINERY 2008 27<br />
Photos<br />
Gerd Wiesendorfer (cover)<br />
Franz Kleine Vertriebs & Engineering GmbH (p. 6)<br />
Herbert Dammann GmbH (p. 8)<br />
Ludwig Bergmann GmbH (p. 10)<br />
Lely Deutschland GmbH (p. 11)<br />
Fliegl Agrartechnik GmbH (p. 13)<br />
Kverneland Group Deutschland GmbH (p. 16)<br />
Hardi GmbH (p. 18)<br />
Status<br />
June 2008<br />
Subject to correction.<br />
© <strong>VDMA</strong>
<strong>VDMA</strong><br />
<strong>Agricultural</strong> <strong>Machinery</strong><br />
Lyoner Strasse 18<br />
60528 Frankfurt am Main<br />
Germany<br />
Phone +49 69 66 03-12 98<br />
Fax +49 69 66 03-14 64<br />
E-Mail gerd.wiesendorfer@vdma.org<br />
Internet www.vdma.org<br />
www.vdma.org<br />
<strong>VDMA</strong>, Titel DesignStudio