Agricultural machinery in Russia

Main article: Agriculture in Russia

2023: Growth of agricultural machinery production by 8.2% to 271.1 billion rubles

The production of agricultural machinery in Russia in 2023 reached 271.1 billion rubles, which is 8.2% more than a year earlier. At the same time, in 2022, the growth rate of output was higher (+ 15.1%). This is evidenced by the data published on February 1, 2023 by the Russian Association of Manufacturers of Specialized Equipment and Equipment (Rosspetsmash).

In physical terms, most market segments in 2023 showed a decline. For example, tractor output and shipments fell by 6.5% and 13.3%, to 5.8 thousand and 4.6 thousand units, respectively. Harvester production grew at a relatively low base after falling in 2022. The situation among the players of the Russian Federation was influenced by the limited financing of the "1432 program" in the first half of 2023, according to which farmers can receive discounts on equipment, Kommersant reports.

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Rosspetsmash associates the decrease in the dynamics of production of Russian agricultural machinery primarily with the low profitability of farmers, whose financial situation worsened due to low prices for agricultural products and export duties on grain. According to the experts of the association, a situation has developed in the Russian market when the supply of agricultural machines significantly exceeded demand. At first, the agricultural business directed funds to fertilizers, fuel and lubricants, seeds, loan servicing and other expenses. At the same time, agricultural machines were purchased according to the residual principle, noted in Rosspetsmash.

They also add that the situation has worsened due to the reduction in the first half of 2023 of funding for a fundamental measure of state support for farmers to update the machine and tractor fleet - the "1432 program" - from 8 billion to 2 billion rubles. Experts interviewed by Kommersant expect a drop in sales of agricultural machinery in Russia in 2024.^[1]

2022

The increase in tractor imports for 4 years to 30.6 thousand units.

In 2022, 30.6 thousand tractors were delivered to the Russian market from abroad, which is 37.6% more than in 2018. This is evidenced by data that the analytical agency BusinesStat published in November 2023.

According to the study, in 2022, 12% more equipment was imported into the Russian Federation than a year earlier. The main suppliers were the enterprises of Belarus and China, so the growth of tension in relations between Russia and Western countries did not become an obstacle to the supply of tractors. The strengthening of the ruble, in turn, made it possible to purchase foreign equipment at a more profitable price in ruble terms, which significantly stimulated demand during the year.

In the import of tractors for forestry and agriculture to Russia, medium-capacity tractors prevail: in 2022, almost half of all tractors were cars with engine power from 37 to 75 kW - 14.3 thousand units, or 46.9%. The second most popular were low-power tractors with an engine with a capacity of up to 18 kW - 8 thousand units, or 26.2% of annual imports. Tractors with an engine with a capacity of 75 to 130 kW amounted to 4.8 thousand units, or 15.9% of imports.

According to experts, imported tractors are much cheaper than Russian-built machines, which is their main competitive advantage. Vice President of the Russian Grain Union Alexander Korbut says that prices for agricultural machinery in Russia in 2-22 increased by an average of 20-25%.

At the same time, it must be understood that foreign spare parts are used when assembling Russian equipment. Work is underway on import substitution, but there is one difficulty here - small volumes of replacement production, - he said.

According to Korbut, the growth in the production of Russian agricultural machinery may begin by 2025.^[2]

Production of motor units and motor cookers in Russia decreased after an increase of 60%

By the end of 2022, the production of motor units and motor cookers in Russia decreased by 26.1% compared to 2021, when the market volume soared by 60%. Such data were disclosed by BusinesStat researchers in May 2023.

Experts attributed START Cargo (Patriot brand), Krasny Oktyabr - Neva (Neva brand), Korona (Korona brand), UralBenzoTech (Forza and Eco brands) and Tulamash-Tarpan (Tarpan brand), Mobile K (Mobile brand K). Some of these companies specialize in the independent production of motor units and motor cookers, some of them assemble on the basis of parts imported from abroad, and at the same time sell imported models of equipment. The production of motor units and motor cookers is also carried out by enterprises whose main activity is the production of defense industry products, and the production of civilian equipment is only an additional type of activity.

In 2022, the volume of exports of motor units and motor cookers from Russia amounted to $7.53 million, which is 73.5% higher than in 2018. During the five-year period, the indicator showed multidirectional dynamics, significantly increasing in 2020-2021. by 22.8-49.5% and decreasing in 2019 and 2022 by 1.1% and 4.4%, respectively.

In 2022, the average export price of motor units and motor cookers amounted to $661 apiece, which is 6.6% higher than the level of 2018. After a significant reduction in the price of supplies in 2019 by 15.9% in the next 2020-2022. The average export price increased annually at a rate of 1.6% to 21.1%.

At the end of 2022, the Russian export of motor units and motor pickers amounted to 11.4 thousand units, exceeding the level of 2018 by 62.5%. Both new products produced at Russian enterprises and imported products that are not sold on the domestic market or used are supplied for export, the study noted.^[3]

Growth in sales of Russian agricultural machinery by 17.2%, to 235.4 billion rubles

In 2022, Russian manufacturers of agricultural machinery increased its sales by 17.2% compared to 2021 - to 235.4 billion rubles. This is evidenced by the data of "Rosspetsmash," which on February 1, 2023 leads the newspaper "Kommersant."

In 2022, the output of agricultural machinery in the Russian Federation increased by 15.1%, to 250.6 billion rubles - by 15.1%. At the same time, production decreased: 32% fewer combine harvesters were harvested, 14% - forage harvesters, 1% - tractors. The accompanying devices also went into the red.

Russian manufacturers of agricultural machinery increased its sales by 17.2%

The output data partially correspond to the results of purchases of agricultural machinery by the domestic agro-industrial complex. The Ministry of Industry and Trade noted that Russian manufacturers account for a significant share of the entire market.

Agricultural machine builders are highly dependent on the income of farmers. Due to the fact that grain prices went down, the profitability of agricultural producers may fall, which will slow down the pace of renewal of the fleet of special vehicles, the newspaper points out.

The decrease in the sale of agricultural machinery in physical terms, recorded in 2022, is associated with an increase in its value and uncertainty in the agricultural market, as well as with a negative price situation. Also, the underproduction was influenced by interruptions in the supply of foreign components and the lack of established routes for imports, the publication says.

At the moment, the demand for new agricultural machinery remains weak, it is quite difficult to make forecasts for 2023. State support, including for the production of domestic parts, can help correct the current situation.

The volume of the entire Russian agricultural machinery market in 2022 amounted to 389.4 billion rubles, which decreased slightly (-0.4%). Experts interviewed by the publication called such dynamics a positive result.^[4]

Domestic producers account for more than 60% of the Russian agricultural machinery market

Domestic producers account for more than 60% of the Russian agricultural machinery market, Deputy Prime Minister of the Russian Government Denis Manturov said in October 2022.

2021: Russian agricultural machinery market grows by a third

Sales of Russian agricultural machinery in the Russian Federation at the end of 2021 reached 199.4 billion rubles, which is 32.7% more than a year earlier. Its output grew by 46%, to 217.7 billion rubles. Such data in early February 2022 were cited by Rosspetsmash.

Shipments of combine harvesters to the Russian market in 2021 amounted to 7 thousand units, which is 26.2% more than a year ago. In the segments of forage and agricultural tractors, an increase of 4% (up to 339 units) and 28.1% (up to 6 thousand units) was recorded, respectively.

The Russian agricultural machinery market in 2021 showed growth

According to Tebiz Group estimates, the agricultural machinery market in Russia in 2021 grew sharply and exceeded $4.4 billion due to imports (here the growth was 33%) and domestic production (+ 25%). Most of the market is formed by imported products - more than 75% in 2021 against 69% in 2020. The volume of domestic production in 2021 exceeded 530 thousand units of equipment.

The largest share in the sales structure in physical terms was occupied by hay mowers and other mowers (about 44%). More than 26% were harrows, ripples and cultivators, about 5% were poultry equipment.

According to experts, Russian manufacturers produce various equipment, but the largest areas of agricultural machinery are feed crushers, cultivators, minitractors, plows, ripples, poultry equipment, harrows and agricultural loaders.

More than 55% of exports are sent to Kazakhstan. Also, a significant part is sent to the nearest countries, such as Belarus, Ukraine and Lithuania.

Of the Russian exports, the largest income was brought to manufacturers by harvesting machines, machines or mechanisms for threshing, harrows, rippers, cultivators, hollows and hoops, seeders, seedlings and seating machines.^[5]

2020: Growth in the volume of exports of Russian agricultural machinery by 30%, to 15.9 billion rubles - Rosspetsmash

The volume of exports of Russian agricultural machinery in 2020 reached a record 15.9 billion rubles, an increase of 30% compared to 2019, when the previous maximum of 12.2 billion rubles was registered. This is evidenced by the data of the Rosspetsmash association.

Its experts linked the rise in exports with high prices for agricultural products, as well as with the effective implementation of state support measures and improving the quality of Russian equipment. Prices for agricultural products were at a level that allowed farmers to increase the pace of renewal of the machine and tractor fleet, Rosspetsmash said in a statement.

The volume of exports of Russian agricultural machinery in 2020 increased by 30%

In quantitative terms, the largest export growth was recorded in the following main segments:

• shipments of four-wheel drive agricultural tractors abroad increased by 43%, to 524 units;
• harrow - by 41%, up to 810 units;
• forage harvesters - by 35%, up to 112 units;
• plows - by 34%, up to 419 units;
• cultivators - by 30%, up to 153 units;
• combine harvesters - by 23%, up to 1063 units.

Deliveries of agricultural machinery from Russia in 2020 went to 38 countries, the main directions were the CIS and EU countries, as well as Mongolia, Africa and the Middle East. In 2020, exports to Germany in monetary terms increased by 4.6 times, to Austria - by 4.5 times, the Czech Republic - by 2.9 times, Bulgaria - by 2.1 times, as well as to France - by 84%, to the Netherlands - by 73%, Kyrgyzstan - by 51%, Hungary - by 44%, Kazakhstan - by 29%.

Rosspetsmash noted that in 2020 not only exports have grown, but also the volume of production of Russian agricultural machinery. Compared to 2019, the increase was 29.6% - up to 149 billion rubles. The share of domestic equipment in the domestic market reached 58%, which is 4 percentage points higher than in 2019.

According to experts, the preservation of positive dynamics and the development of agricultural machinery exports may be hindered by the rise in metal prices and the introduction of quotas for grain exports.^[6]

2018: Agricultural machinery market according to Rosspetsmash

2017

Exports of Russian agricultural machinery grew by 16% - to 7.9 billion rubles

Over the past years, exports of products of Russian agricultural machinery companies have been steadily growing. In 2017, it amounted to 7.9 billion rubles, which is 16% more than in 2016 and 36% more than in 2015. The geography of deliveries of domestic agromachines abroad over the past 5 years has covered 47 countries.

Among the main importers of Russian agricultural machinery in 2017 were the CIS countries, the countries of the European Union, Mongolia and Canada.

In 2017, supplies of Russian equipment to Mongolia increased 6.6 times, to Armenia - 6.5 times, to Canada - 2.9 times, to Bulgaria - 2.8 times, to Hungary - 2.7 times, in the Netherlands - 2 times, in Poland - by 78%, in Slovakia - by 73%, in Uzbekistan - by 68%, in Moldova - by 58%.

Supplies from Russia abroad of agricultural tractors increased by 63% - to 330 units, machinery for post-harvest processing of crops - by 50% to 560 units, tillage equipment - by 31% to 783 units, sowing equipment - by 24% to 536 units.

One of the main reasons for the growth of export supplies is the improvement of the quality of domestic agricultural machines and the production of new lines of equipment. In 2017 alone, more than 150 new models of equipment were put into mass production.

In addition, the increase in exports of domestic agromachines is associated with the preservation of existing and the introduction of new state support measures. Among them - subsidizing part of the costs of transportation of products, for certification of products in foreign markets during the implementation of investment projects, subsidizing part of the costs associated with participation in congress and exhibition events to promote products to foreign markets and other measures.

To promote the products of domestic plants abroad, the Rosspetsmash Association, together with the Ministry of Industry and Trade of Russia, organize their participation in major international exhibitions, and also conduct business missions in foreign countries. Practice shows that enterprises that take an active part in these events achieve the greatest success in the development of exports of their products.

The Export Development Strategy in the agricultural engineering industry for the period up to 2025, approved by the Russian Government on August 31, 2017, has a positive impact on the implementation of the export potential of Russian agricultural machinery producers. The optimistic scenario of the strategy provides for the expansion of the geography of supplies of Russian agricultural machinery to 65 countries in 2025 and an increase in export volume by this period to 30 billion rubles. "

To promote domestic agricultural machinery abroad, the Rosspetsmash Association, together with the Ministry of Industry and Trade of Russia and the Ministry of Economic Development of Russia, organize the participation of Russian agricultural machinery plants in major international exhibitions, and also conduct business missions in foreign countries. Practice shows that enterprises that take an active part in these events achieve the greatest success in the development of exports of their products.

The Export Development Strategy in the agricultural engineering industry for the period up to 2025, approved by the Russian Government on August 31, 2017, has a positive impact on the implementation of the export potential of Russian agricultural machinery producers. The optimistic scenario of the strategy provides for the expansion of the geography of supplies of Russian agricultural machinery by 46% - from 48 countries in 2018 to 70 countries in 2025.

Production of agricultural machinery in Russia for 6 months 2017 increased by 35%

Russian agricultural machinery plants produced equipment for 59.8 billion rubles in 6 months. 2017, which is 35% more than in the same period in 2016.

Agricultural machinery production has grown in many key positions. Significant growth is observed in the segment of all-wheel drive tractors - 45% to 1.37 thousand units.. Plow production increased by 9% to 1, 45 thousand units, harrow - by 11% to 2.52 thousand units, seeders increased by 12% - up to 5.40 thousand units, combine harvesters - by 18% to 3.14 thousand units, sprayers - by 23% to 604 units, machines for applying mineral fertilizers - 19% to 294 units, press pickers - by 8% to 1.05 thousand units.

Experts of the Rosspetsmash Association associate the growth in production in Russian agricultural machinery with the current measures of state support, an increase in the quality of Russian agromachines, the production of new lines of equipment and an increase in exports to countries of far and near abroad.

However, for the second half of the year, the forecast for the production of agricultural machinery in the association is negative. The shutdown of Program No. 1432, according to which the state subsidizes the factories with discounts in the amount of 15% -20% provided to farmers, will significantly affect the decrease in the production of agricultural machinery.

In June, the total amount of subsidies under concluded contracts exceeded the allocated 13.7 billion rubles, in connection with which the plants stopped the sale of equipment under Program No. 1432.

To maintain the pace of production this year, subsidies need another 4.4 billion rubles. If the amount of funding under Program No. 1432 does not increase in 2017, then the growth in agricultural machinery production in Russia will decrease and by the end of 2017 will amount to 12%.

Subsidizing agricultural machinery manufacturers in 2018-2020 is not provided for in the federal budget. At the same time, according to manufacturers, the failure to provide subsidies under Program No. 1432 in 2018-2020 will negatively affect the renewal of the fleet and the production of agricultural machinery in the Russian Federation. In 2018, the volume of agricultural machinery sales will decrease by 30% compared to 2017, tax payments to budgets of all levels will be reduced by 32%, the number of employees will be reduced by 2 thousand people, the average monthly salary will be reduced by 12%.

To continue Program No. 1432 in 2018-2020, taking into account the high depreciation of the fleet and the shortage of agricultural machinery among agricultural producers, the draft federal budget for 2018 and the planning period of 2019 and 2020 must provide for 15 billion rubles annually.

Also, factors that negatively affect the development of agricultural machinery production in Russia are the ruble strengthening compared to 2016 and a decrease in the income of agricultural producers due to low prices for agricultural products in 2017.

Agricultural producers will purchase twice as much equipment in 2017 as in 2016

Thanks to financing of agricultural machinery manufacturers in 2017 in the amount of 13.7 billion rubles, agricultural producers will be able to purchase more than 20 thousand units of modern agricultural machinery on preferential terms in 2017, and this is almost 2 times more than in 2016.

The measures taken by state support allow Russian factories to implement plans year after year to increase the output of agricultural machines in demand by farmers.

This was announced in April 2017 by the Minister of Industry and Trade of the Russian Federation Denis Manturov. "The data we obtained in the first quarter of 2017 confirms the implementation of these plans: the growth in the production of energy-saturated tractors was 50%, combine harvesters - more than 30% compared to the first quarter of last year."

Draft Strategy for the Development of Agricultural Engineering until 2030

The Ministry of Industry and Trade of Russia, in accordance with the instructions of the Government of the Russian Federation, prepared in March 2017 a draft Strategy for the Development of Agricultural Engineering of Russia for the Period until 2030.

"According to the results of 2016, the share of domestic producers in the domestic market amounted to 54%. The task facing domestic agricultural machine builders is to bring the indicator of the number of modern Russian machinery and equipment for agriculture to at least 80% by 2030. At the same time, it is planned to provide targeted support for exports so that manufacturers increase the volume of supplies of modern Russian agricultural machines abroad to 50% of consumption in the domestic market. Priority markets for domestic agricultural machinery, in addition to the markets of the CIS countries, will be the EU, South Africa, Australia, China, North America, "said Denis Manturov, Minister of Industry and Trade of the Russian Federation

As a result of the implementation of the Strategy's measures, the production of agricultural machinery in Russia will grow to 280 billion rubles by 2030, while exports will amount to about 93 billion rubles.

The Ministry of Industry and Trade of Russia plans in April - May to hold a number of public discussions of the draft strategy, based on the results of which, a document agreed by the Ministry of Agriculture of Russia, the Ministry of Economic Development of Russia, the largest industry organizations of manufacturers and consumers of agricultural machinery products, is planned to be considered in the Government in June 2017.

2016: Volume of domestic agromachines sales - RUB 80.7 bln

According to Resolution No. 1432 in 2016, farmers purchased Russian equipment for 47.7 billion rubles, with the total volume of sales of domestic agromachines - 80.7 billion rubles. In 2016, 79 plants took part in the program. The average share of subsidies in the volume of production for both leading and small Russian enterprises in 2016 was 12.6%.

Notes