Common topics
1. Tractor sales trend last 6 months compared to same 6 months last year and why
Tractor sales were down 9% in the last six months compared to the same six months last year. The reasons are as follows.
・There was a government subsidy for machine purchases in 2021, but there was no such subsidy in 2022.
・The farmers' investment motivation was low due to deterioration in the quality of agricultural products and the decrease in yield by heavy rain disasters in 2022.
2. Farm Income projection for the next 12 months and what is driving this trend
The production and quality of agricultural products are affected by the weather, and the consumption in recent years has been affected by Covid-19. These trends are expected to continue in 2023. It is difficult to forecast farm income; the hope is that it will be higher than the previous year.
3. Key Commodities in regional price trends
The price of rice is determined by the balance between supply and demand, but it is difficult to forecast the price of rice in 2023. The price of rice in 2022 rose compared to the previous year; and it is hopeful that the same trend will continue.
Country report summary
Equipment Forecast
Market trend in 2023 will be nearly the same as 2022. However, shipment volume of 2022 is 95% compared to the previous year. So, 2023 is not expected to be good. Reasons:
- Farmers will not be willing to invest in agricultural machinery due to soaring fertilizer and pesticide prices.
- Ag machinery production will be affected due to shortages of semiconductors and electronic components.
Key influencers of equipment sales
Covid-19, Russia-Ukraine problem, Semiconductor shortage, Supply chain disruption
Common concerns in all manufacturing industries
- Soaring prices of parts, logistics, energy, etc.
- Difficulty in procuring raw materials for parts
- Rising foreign exchange risk (depreciation of Japanese Yen)
Overall Conclusions
- Business activity is slowly returning to pre-covid19 situation
- Above “key influences” will continue for a while
- The market trend in 2023 will see a small recovery
