U.S. FARM EQUIPMENT EXPORTS DECLINE, BUT AT SLOWER PACE
Exports of U.S.-made agricultural equipment for first quarter 2016 dropped 8 percent overall compared to first quarter 2015, for a total $1.7 billion shipped to global markets.
Europe and Central America each recorded double-digit gains, with double-digit declines from the other world regions, led by Africa and South America, according to the Association of Equipment Manufacturers (AEM), citing U.S. Department of Commerce data it uses in global market reports for members.
AEM is the North American-based international business group representing the off-road equipment manufacturing industry.
Exports by World Region
First quarter 2016 U.S. agricultural equipment exports by major world regions compared to first quarter 2015:
- Europe gained 21 percent, for a total $495 million
- Canada dropped 20 percent, for a total $468 million
- Central America gained 11 percent, for a total $304 million
- Asia fell 21 percent, for a total $141 million
- South America dropped 30 percent, for a total $132 million
- Australia/Oceania fell 27 percent for a total $88 million
- Africa decreased 32 percent, for a total $46 million
AEM Market Analysis Overview
AEM’s Benjamin Duyck, director of market intelligence, provides some insights:
While U.S. ag equipment exports to the world continue to decline, this quarter’s year-over-year decline of 8 percent was lower than last quarter’s 16.7-percent decline and 2015 third-quarter decline of 29 percent. Declines continued to be expected as global market drivers responsible for the ag downturn, such as low commodity prices and the larger global malaise, remained in place. Aside from specific industry-related issues, international trade overall is slowing down. On a macro-economic scale, the Baltic Dry Index, which tracks the price of moving major raw materials by sea, fell to an all-time low in March. A strong U.S. dollar also continues to hamper our nation’s global competitiveness.
According to the results of the recent Agrievolution Business Barometer, the global recovery for our industry is not expected to be in sight for at least six months. While the sector seems to have stabilized, it is at a low level. While the survey indicated that East Asia and Africa are leading the future expectations, our recent data shows that for the United States, Central America remains an important market. While in the Barometer survey, there was also a reduction in optimism coming from Europe, U.S. exports did increase. Exports of harvesting equipment, and in particular combines, as well as exports of tractors and parts drove the growth in exports to Germany. Export growth in new tractors was the main driver for trade with France.
Exports by Top 10 Countries
The top countries buying the most U.S.-made agricultural machinery during first quarter 2016 (by dollar volume) were:
- Canada - $468 million, down 20 percent
- Mexico - $276 million, up 14 percent
- Australia - $79 million, down 27 percent
- Germany - $73 million, up 11 percent
- France - $63 million, up 37 percent
- Brazil - $50 million, down 19 percent
- Ukraine - $49 million, up 161 percent
- China - $49 million, down 36 percent
- Russia - $39 million, up 48 percent
- United Kingdom - $37 million, down 13 percent
Economic Resources Available
AEM provides a variety of market macroeconomic and industry trend data for members as well as survey opportunities and custom research. Visit www.aem.org in the Market Data/Market Intelligence section. For more information, contact AEM’s Benjamin Duyck, director of market intelligence (firstname.lastname@example.org).
About the Association of Equipment Manufacturers (AEM) - www.aem.org AEM is the North American-based international trade group providing innovative business development resources to advance the off-road equipment manufacturing industry in the global marketplace. AEM membership comprises more than 850 companies and more than 200 product lines in the agriculture, construction, forestry, mining and utility sectors worldwide. AEM is headquartered in Milwaukee, Wisconsin, with offices in the world capitals of Washington, D.C.; Ottawa, Canada; and Beijing, China.