Known from the Summit Forum on Circulation of Agricultural machinery and industrial development at Xiangtan on 25 September, the market in this field is faced with the biggest decline in 10 years.
Since the implementation of China agricultural machinery purchase allowance from 2004, the market had ushered a golden decade of development. Both manufacture and marketing had developed well, with 18% growth per year.
For having benefited from the increasing allowance, many agricultural machinery manufacturers and dealers expected for the next golden decade at the beginning of 2014.
However, the facts turned out to out of expectation. According to data published on the forum by Wang Yushi, the vice chairman of China Agricultural Machinery Circulation Association, production and sales of large and medium size agricultural machinery from January to July increased by 7% on year-on-year basis. That of small farm tractors even declined by 11.6%, compared with the same period in 2013.
The decrease is actually the biggest one in the past tens years. Some agricultural manufacturers and dealers also testified that plow machines and harvesters do not sell well in 2014.
Wang Yushi analyzed that the main reason for the downturn is that production capacity of traditional agricultural products is excess in some regions while the new traditional agricultural machines and tools is not enough. For example, most of manufacturers focus on the manufacture of machines and tools
that used in grain production process. However, with development in ten years, the comprehensive mechanization level of wheat and rice reach 93.7% and 73.1% respectively while that of many cash crops is far from enough.
Experts stated that, the unceasing growth of agriculture will promote the market growth of agricultural machines. The downturn at present is temporary. It demonstrates that the industry needs an adjustment.