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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

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