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U.S. Ag Equipment Exports Continue To Decline
According to the Association of Equipment Manufacturers (AEM), exports of U.S.-made agricultural equipment declined 15.8% in the first three quarters of 2015 compared to the same time last year.
With a total of $5.8 billion of equipment shipped worldwide, Asia recorded double-digit gains; while South America and Europe saw the biggest drop.
Exports by Region: January to September 2015 compared to January to September 2014
Canada dropped 19% ($1.8 billion total)
Europe declined 28% ($1.2 billion total)
Central America gained 4% ($844 million total)
Asia gained 21% ($738 million total)
Australia/Oceania fell 3% ($539 million total)
South America dropped 34% ($521 million total)
Africa decreased 26% ($198 million total)
“The third quarter of 2015 marked the seventh consecutive quarter that U.S. agricultural equipment exports and imports experienced year over year declines,” says Benjamin Duyck, AEM’s director of market intelligence. “These results are in line with the domestic and global demand trends. AEM’s third quarter North American ag equipment industry conditions trends report initial results indicated that 76.75% of respondents felt demand had fallen compared to the same period the previous year. Only 13.95% of respondents felt demand had remained unchanged. That marked the sixth quarter that more people felt the market demand was decreasing vs. increasing. Also, according to the survey, 55.2% of exporters felt their exports had fallen year over year while 31.5% felt they had remained unchanged.”
According to Agrievolution Alliance’s Agritech Business Barometer, pessimism is still a dominating theme from a global perspective.
“However, there were some variations between regions,” notes Duyck. “North America and South America, namely the U.S. and Brazil, continue to experience a strong downturn as new orders fall short. Additionally, Brazil is also struggling with strong credit restraints. Eastern markets such as Russia, China and India seem to be in a better mood, driven by optimism regarding government support. Optimism in the eastern markets seems to be supported by the double digit uptick in exports to these markets.”
Besides a strong U.S. dollar, lower commodity prices are taking a toll on worldwide farm income, profitability and ultimately exports.
Countries buying the most U.S.-made ag machinery in the first three quarters of 2015 (by dollar volume) were:
Canada - $1.8 billion, down 19%
Mexico - $737 million, up 8%
Australia - $473 million, down 3%
China - $418 million, up 47%
Germany - $196 million, down 20%
Brazil - $172 million, down 49%
France - $147 million, down 12%
United Kingdom - $129 million, down 5%
South Africa - $127 million, down 31%
Belgium - $122 million, up 6%