The Russian market for AG machines has increased by 1.5 times during the first six months of this year, reaching 93.9 billion rubles (US$ 1.27 billion). Production volume has increased by 45% to 112.7 billion rubles (US$ 1.54 billion).
The largest growth has been in the output of plows, climbing to 1,800 units and AG tractors – by 43% to 2,800 units. Production of sprayers has increased by 37.3% to 953 units. There has been a modest gain in production of grain combines, increasing 10.2% to 3,800 units, and self-propelled mowers, gaining 2.6% to 228 units.
The domestic media has published information that experts have reduced the forecast about grain harvest. However, vice-president of the Russian Grain Union Korbut says there are no such threats.
PSR Analysis: Among the reasons of such growth are the recovery from the pandemic, high prices for grain, expected future price growth for machines based on metal price growth and possible depletion of the money, assigned by the State to subsidize purchase of local AG machines. If this fund is depleted, the prices for machines will go up by 25% at once. From the other side, the sales growth is restricted by the deficit of some machines, like combines and sprayers. In this case, the production cannot catch growing demand. PSR
Maxim Sakov is Market Consultant – Russia Operations, for Power Systems Research
