Worldwide Farm Machinery Markets New Delhi, 6 th December 2013 Gerd Wiesendorfer Coordinator Agrievolution Economic Committee [email protected]

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Worldwide Farm Machinery Markets

New Delhi, 6th December 2013

Gerd WiesendorferCoordinator Agrievolution Economic [email protected]

Fourth World Summit on Agriculture MachineryDecember 5-6, 2013 ~ New Delhi, India

Fourth World Summit on Agriculture Machinery ~ December 5-6, 2013 ~ New Delhi, India

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Business climate in the global industry is favourable …Agritech Business Climate Index

Possible range from -100 to +100

Source: Agritech Business Barometer, Agrievolution weighted global average

Apr 10 Oct 10 Apr 11 Oct 11 Apr 12 Oct 12 Apr 13 Oct 13

Climate Index 1 34 65 44 35 19 29 32

Current Situation -23 8 60 49 37 25 25 36

Future Situation 26 61 71 38 33 13 33 27

-40

-20

0

20

40

60

80

Climate Index

Current Situation

Future Situation


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… with clear upward trends in most regionsAgritech Business Climate Index

Possible range from -100 to +100

Source: Agritech Business Barometer Survey, Agrievolution *weighted global average

-80

-60

-40

-20

0

20

40

60

80

100

World* USA Brazil WesternEurope

Turkey China Korea Japan

Oct 10 Apr 11 Oct 11 Apr 12 Oct 12 Apr 13 Oct 13


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Increasing orders for agricultural machinery in major markets …

Answers from manufacturers / importers according to location, in % of interviewees

Source: Agritech Business Barometer October 2013, Agrievolution - Western Europe: comparison Oct 13/Oct 12 * weighted global average

Question: Our volume of incoming orders on our domestic market, compared to the same period a year ago, has developed as follows in the past 3 months:

5

8

9

10

7

8

8

18

14

19

8

29

30

27

26

24

33

31

46

35

49

36

35

24

14

44

46

20

5

9

35

14

24

25

2

2

14

2

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

World*

USA

Brazil

Western Europe

Turkey

China

Korea

Japan

more than +40% +21% to +40% +5% to +20% unchanged (+/- 4%) -5% to -20% -21% to -40% more than -40%


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… lead to expansionary turnover expectations for the next months.

Question: We expect our overall turnover within the next 6 months to …Answers from manufacturers / importers according to location

Source: Agritech Business Barometer Survey October 2013, Agrievolution * weighted global average

45 4642

35 38

61

50 54

3744 50

3938

2035

46

1810 8

26 2420

15

0%

20%

40%

60%

80%

100%

World* USA Brazil WesternEurope

Turkey China Korea Japan

decrease

remainunchanged

grow


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Fläche für Grafik

Source: VDMA (Forecast status October 2013)

Development of the agricultural machinery production Index 2008 = 100, based on nominal terms in Euro

50

100

150

200

250

2009 2010 2011 2012 2013e

World

European Union

China

North America

India

Latin America

Production has experienced a very dynamic phase in the past 5 years

Average annual growth rates2009 - 2013

European Union 2%

Eastern Europe 3%

Japan 4%

Latin America 4%

World 7%

India 7%

North America 9%

China 19%

Turkey 23%


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Regional shifts of production – with China being a major driver

Source: VDMA (estimations), Status October 2013, basis in Euro

Shares of global agricultural machinery production in %

38,0 38,8 39,0 39,134,7 32,0 32,8 31,2 30,6

27,7 26,0 23,5 24,126,6

25,3 24,9 25,7 26,5

7,4 8,6 11,0 11,5 15,316,1 17,1 19,3 19,3

7,4 5,9 7,2 7,4 6,07,0 6,2 5,7 6,1

4,1 4,7 5,2 5,0 6,1 6,0 5,4 5,2 5,24,1 3,9 3,9 4,2 3,3 3,6 3,6 3,8 3,24,4 4,7 3,8 2,4 1,5 2,9 3,8 3,2 3,04,2 4,5 3,8 3,4 3,4 3,5 2,9 2,8 2,92,8 3,0 2,7 2,9 3,1 3,4 3,2 3,4 3,1

0

10

20

30

40

50

60

70

80

90

100

2005 2006 2007 2008 2009 2010 2011 2012 2013e

Others

Japan

Turkey

Eastern Europe

India

Latin America

China

North America

European Union


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Strong tractor markets 2013: America and Asia

2008 2009 2010 2011 2012 2013e %

Canada 28.865 23.167 22.834 24.117 25.238 27.500 9

United States 197.752 155.262 164.894 168.013 185.167 202.000 9

Brazil 43.414 45.437 56.420 52.296 55.810 65.000 16

Japan (> 22 kW) 15.629 15.318 14.269 15.246 16.539 19.847 20

China (> 18 kW) 200.000 280.000 320.000 350.000 390.000 440.000 13

Korea 15.179 14.717 15.603 15.879 14.488 15.000 4

India 392.000 403.903 520.073 564.699 534.079 570.000 7

Russian Federation 38.794 13.292 21.085 36.997 41.811 39.302 -6

Turkey 27.022 13.758 36.072 60.466 50.320 47.000 -7

European Union 210.504 184.379 167.517 187.352 188.125 183.000 -3

of which: France* 40.716 36.800 29.123 35.409 39.089 42.500 9

of which: Germany 31.250 29.464 28.587 35.977 36.264 35.500 -2

of which: Italy 27.261 27.057 23.323 23.431 19.343 18.500 -4

of which: United Kingdom 18.564 16.326 14.486 15.217 14.964 13.200 -12

World 1.500.000 1.450.000 1.700.000 1.900.000 1.950.000 2.050.000 5

* w ithout telehandlers

Source: Agrievolution, VDMA (incl. estimations)

New tractor sales (in units)


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New production and market peak 2013

Fläche für Grafik

Source: VDMA Agricultural Machinery Association (estimations October 2013)

Global agricultural machinery production in bn Euro

54 5661

70

6268

81

9196

2005 2006 2007 2008 2009 2010 2011 2012 2013e


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Weaker drivers for new machinery demand in Western Europe, but basic economic conditions remain favourable

Evaluation of economic farming parametersreferring to investment in new machinery in Western Europe

2013 2014/2015

Agricultural income K JVegetal Production K JAnimal Production J KLevel of agricultural commodity prices K JInput cost K L

Subsidies / agricultural policy J LInterest rates / access to credit loans J JAlternative investment (outside agriculture) K KSource: VDMA

2013 2014/2015

Structural change in agriculture J JContractor business J JCapacity increase / enlargement K K

Replacement need for machinery park K LUsed machinery market K LTechnological innovation / machinery offers J JGeneral sentiment / uncertainty etc. J KSpecial impact (e.g. animal diseases) K K


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General conditions for the global markets 2014/2015

• Comparatively good prices for agricultural commodities and slightly lower costs

• Investor´s liquidity predominantly on a good level

• Conditions on the capital market generally good

• Higher degree of mechanization due to a growing demand for efficiency

• Structural change increases the demand for high capacity machines

• Agricultural policy will continue to be a stimulus for investment, following different politcal objectives

• Emerging markets: Higher degree of mechanization, modernization of fleets

• East Europe: Self-sufficiency gains (food) and export position (grains)

• Europe: Promotion of smaller and diversified structures + „greening“

• USA: Income stability for farmers and promotion of bioenergy production


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Decline of market and production volume 2014 remains very limited

Fläche für Grafik

Source: VDMA Agricultural Machinery Association (estimations October 2013)

Global agricultural machinery production in bn Euro

54 5661

70

6268

81

9196 94

2005 2006 2007 2008 2009 2010 2011 2012 2013e 2014e

Documents

Worldwide Farm Machinery Markets New Delhi, 6 th December 2013 Gerd Wiesendorfer Coordinator Agrievolution Economic Committee [email protected]