MOSCOW--The China Machinery and Innovations Fair was held at the Moscow Expocenter Fairgrounds here Oct. 30 – Nov. 1. It was operated by Messe Frankfurt and supported by China Chamber of Commerce, Chinese municipal governments and China Councils for the Promotion of International trade.

The announced purpose of the fair was to promote the Chinese goods in the Russian market.

The show occupied about 12,000 square meters and accommodated 150 participants – most of them Chinese companies. Most of the participants were limited to small booths, except one – XCMG, which presented two construction machines, an asphalt compactor and a grader. Most of other participants were lesser known companies.
One popular program of the fair was the Machinery Forum. This event included a major presentation by XCMG and speeches by Russian officials and Chinese businessmen.

The interesting insights from the show include:

  • Construction work financing in Russia grew from 4.4 trillion rubles in 2010 to 7.5 trillion rubles in 2017. However, if one considers currency exchange rates for the period, the financing trend is flat on the level of US$150 billion annually.
  • There are about 27,000 active construction companies in Russia. This number has been increasing slowly since 2012.
  • The Wear level of the construction machine fleet in Russia is very high. It varies from 32% (share of machines with expired lifetime) for excavators to 57% for crawler cranes, 47% for dozers, and 46% for graders.
  • The share of Chinese machinery in Russia’s total import volume ranges from 5% for wheel excavators to 87% for front end loaders. About 45% of all imported construction machinery comes from China.
  • The current trade sales between Russia and China is US$ 100 billion. The goal now is to double this figure.
  • The quality of Chinese machinery has improved significantly in recent years, and now it can compete with leading Western equipment. Chinese OEMs have a good chance to find customers in Russia, especially when they keep low prices and provide financing.
  • Other opportunities for Chinese business have opened recently with the introduction of high custom duties on US construction machinery. For example, the 25% is a response for aluminum import taxes; Caterpillar and others are affected.
  • Import restrictions for machinery in Russia will be stronger in coming years. Currently, there are closed discussions in the government about restricting the use of imported gen-sets for installations above 15 MWt. If this is true, it will affect turbine gen-sets, mostly. So, Chinese companies are considering creating JVs with local players.   PSR