MSP Issue 24

cover story
Deferred Demand
It is widely known that the
Western countries are leading in
the production of equipment for
the food and particularly meat
industry, because they develop
new technologies and provide the
market players with new solutions.
It is difficult to give exact figures,
but according to different estimates,
80−95% of the equipment installed in
Russian meat processing companies
is imported, and moreover, 2016
has begun better for the equipment
suppliers than the previous one.
According to the research and
information company VVS
(VladVneshService), in the first six
months of 2016, the import of meat
and poultry processing equipment
was 8,320 units with the total price
of $92,2 mln. Compared to January-
June 2015, this indicator rose by
23,9% in quantitative terms and by
19,9% in money terms.
In the first half of the year, meat
and poultry processing equipment
was purchased by 192 Russian
companies from 33 regions. A
quarter of the entire equipment was
delivered to Moscow: the companies
from the Russian capital purchased
2,111 units of equipment. The
second place was taken by Yaroslavl
Oblast with 1,819 units of equipment
delivered. Moscow Oblast took the
third place with 1,788 units imported.
According to VVS, in the first six
months of 2016, the greater part of
the import structure by equipment
type consisted of solutions for meat
chopping, cutting and mixing (meat
grinders, cutters, slicers, mince meat
mixers, etc.) — 5,561 units. They
represent 66.8% of the total import
volume versus 73.9% in the previous
year. There is also a growing demand
for fillers and stuffers. Their share rose
from 6.1% in 2015 to 11.3% (based
on the results of the first six months
of 2016). 939 units were delivered to
Russia in the first half of 2016.
Moreover, the experts note an
increase in the activity of the used
equipment market. Many companies
get rid of the excess redundant
equipment which is leading to a
growing number of companies that
wish to purchase used equipment
necessary for their production.
In general, the so-called deferred
demand is increasing, i.e. when the
factories are interested in purchasing
new equipment but cannot afford
it yet. The reason is that besides
the sharp rise in prices of foreign
machines in rouble equivalent, the
potential buyers are pressured by
the high cost of credits and leasing,
as these financial instruments are
actively used by food manufacturers
in the whole world for technical
reequipment.
40 | MSP Magazine • February/March 2017