“Protectionist endeavors in some markets” are a growing challenge for manufacturers, according to VDMA, the Agricultural Machinery Assn. based in Frankfurt, Germany.
“At present Russian industry is vigorously promoting the extension of import duties previously applied only to combines and forage harvesters to include other product segments,” Scherer says. “At the same time, 50% localization [domestic content] is aimed at as a prerequisite for participating in state aid programs.
“Similar tendencies are exhibited in the Chinese award policy for public invitations to tender, where the order volume largely goes to domestic agricultural machinery companies.”
German exports to Russia have declined by 60%, according to VDMA. Previously, Russia was the second largest customer for German machinery, but has now slipped to sixth.
Overall, German exports to Russia decreased by 31%, and those from the U.S. have fallen to $6.3 billion, or 27%. And according to the association, U.S. tractor exports, which are strongly dependent on Eastern Europe, were 39% under 2008 shipments. Italy, the third largest exporter of agricultural machinery, also registered a decline of 27%, although deliveries to Asia increased.
— Ag Equipment Intelligence, June 2010
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