What is the impact of a demand for agricultural machinery? I believe that tracing the source or the agricultural machinery corresponding to the area planted with the crop. The so-called 'skin does not exist, the hair will attach?', From this perspective, the impact of wheat planter, harvester , Subsoiling machines and other needs should also be the year of wheat sown area.
So in 2018 how the wheat market? Sown area is to increase or decrease it? Through various indications, I believe that in 2018 wheat acreage will decline, and the market price is also lack of security mechanisms, the overall bearish wheat market, and will be related to the wheat Other industries, including our agricultural machinery industry.
Bearish 2018 wheat market
China is the world's largest producer and consumer of wheat, accounting for 17% of the total wheat production and 16% of the total consumption in the world In 2018, the market for wheat in China is grim.
1, reduce revenue, planted area decreased
Wheat acreage has started to decline since 2009. The main reason for the decline is economic reasons, which is to say that planting wheat is not profitable.
2006 wheat net profit level
From the data of research institutes, we can see that the cost-profit rate of planting one acre of wheat was 33% in 2008, compared with only 1.7% in 2015. Due to the labor cost, land rent, input of agricultural inputs, The cost of machine operations and other increases, the planting cost per acre far exceeds the growth rate of output and earnings (2008 cost of 411 yuan per mu, 784 yuan in 2015).
Of course, the increase in planting cost and the decrease in yield are not the most terrible. The main reason for the decline in the area planted to wheat is the decrease in its comparative income, that is, the poor returns from growing wheat relative to economic crops. After a simple comparison, farmers Will certainly give up wheat and replant economic crops.
2009-2017 wheat acreage chart
The total area planted for summer cereal crops in 2017 was 24.1 million hectares, a decrease of 90,000 hectares over the same period of last year, which is generally reflected by the replacement of wheat by cash crops in various regions.
2, imported wheat quality and cheap, domestic wheat sales are facing an impact
In recent years, almost all domestic crops are subject to the impact of foreign quality and cheap crops, wheat has not been spared.
2016 US Wheat Farming Costs and Domestic Comparisons
As can be clearly seen from the above table, the cost per ton of wheat in China is much higher than that in the United States, while the reason that the cost per ton of wheat in China is higher than that in the United States is due to high labor costs and operating costs Is due to the implementation of large-scale mechanized farming of wheat in the United States. The high cost is reflected in the price.
Domestic wheat prices compared with the US CIF
This phenomenon does not always exist and the cost of planting wheat in China is lower than that of the United States until 2013. After 2013, the cost of wheat cultivation in China started to overtake due to the year-on-year increase of agricultural capital, labor cost and land cost.
Of course, thanks to the import quota system to protect the domestic wheat industry, otherwise wheat has long been reduced to the second soybean.China's accession to the WTO promised to import quotas on wheat since 2004, when the promised import volume of 9.636 million tons, since Quotas remain unchanged, imports are mainly gluten wheat, mainly to offset the gap of domestic strong gluten wheat.
In spite of the protection of the import quota system, the fact is that domestic wheat still faces the pressure of importing good quality wheat. First, the negotiations on increasing major food quotas have never stopped. The second is that domestic food processing enterprises have strong demand for high-quality foreign wheat, Also exert pressure on the relevant departments, third is through smuggling, flour, semi-finished products imported wheat is also a minority.
3, food, feed, industrial consumption all declined
The main uses of wheat, food, feed and industrial use of three kinds of consumer routes which consumption accounted for more than 70% of total consumption, feed accounted for 10% to 12%, industrial consumption accounted for 6% to 8%, of course, there are some Seed production, but that part of the strict sense can not be considered spending.
The main purpose of domestic wheat and demand structure
In light of the changes in demand in recent years, the consumption of these three uses has been slowly declining, which is extremely unfavorable to the development of the wheat industry in China.
2011-2017 total wheat consumption trend
Consumption consumption is replaced by rice, meat and other fast.
Due to its good taste and more convenient cooking properties, the proportion of rice consumed by residents in both North and South China has been steadily rising over the last decade, which has formed a strong replacement for wheat flour. In addition, as the consumption of meat and snacks or other food products increases, flour Consumption in the resident population continues to decline.
Compared with corn, wheat has no advantage in feeding.
From the past two years, the situation of consumption of feed point of view, with the market-oriented reform of corn, corn prices, the current wheat-corn spread has reached more than 700 yuan, corn as a feed price advantage compared to wheat, wheat gradually reduced the amount of feed Whether future increases in feed intake will depend on whether wheat-corn spreads can fall.
Demand for industrial raw materials is slowly declining.
Wheat and corn can be used in large quantities in the industrial field, the most common are starch, modified starch, wheat gluten, wine, industrial alcohol, maltose, spices, pharmaceutical accessories, etc. However, the domestic processing of wheat flour at an early stage, deep processing and transformation Coupled with the high cost of wheat compared to corn, corn can completely replace wheat, so in the industrial processing of wheat has no advantage in recent years, the domestic wheat deep processing of product price trend is weak, wheat processing enterprises generally loss , So wheat consumption of industrial consumption has decreased.
Consumption of wheat declined
4, exposure of inventory problems, as with the pressure to go to stocks of corn
Since 2012, wheat inventories have been increasing year by year, while consumption has not risen, resulting in an increase in the inventory consumption ratio year by year. In 2017, there is a situation where inventories exceed consumption, which is directly related to the future trend of the wheat market.
Domestic wheat supply and production, inventory comparison (million tons)
The increase in wheat stocks is the increase in yield leads to an increase in total output and consumption can not keep up.Although the current wheat stocks are not prominent corn stocks, but over time, wheat stocks will eventually usher in the outbreak.
5, the minimum purchase price down to combat wheat planted enthusiasm
In order to protect the enthusiasm of planting and prevent grain prices from hurting the peasants and to ensure food security, China has implemented a minimum purchase price purchase policy for corn, rice and wheat for a long time and the policy on wheat has been officially launched since 2006. In mid-October The minimum purchase price of wheat for the coming year will be announced later in the year and the lowest price for the wheat produced by the farmers will be implemented by the local medium grain storage companies.
Due to the huge inventory pressure and the distortion of the market price mechanism, many countries have canceled the policy of temporary storage of soybean, cotton and rapeseed since 2004, and the Pro-Temporal Corn Acquisition Policy of the three northeastern provinces and Inner Mongolia was canceled in 2016 Followed by October 27, 2017, the National Development and Reform Commission will wheat minimum purchase price from 118 yuan / 100 pounds down to 115 yuan / 100 kg.
The minimum purchase price is lowered, and the market price is expected to decline in 2018 (yuan / ton)
A cut in the national purchase price will result in lower market prices of wheat by 2018, which could be the last straw that will crush the existing stable cropping pattern in wheat.
Wheat market changes will have any impact on the farm machinery market?
1, wheat main producing areas of agricultural demand will decline
Domestic wheat is divided into winter wheat and spring wheat. The overall output of winter wheat accounts for 89% of the national output. Among them, the provinces with larger wheat yield are Henan, Shandong, Hebei, Anhui and Jiangsu in turn, 75% of production.
Proportion of output of major wheat provinces in China (%)
To be sure, these provinces are the provinces where domestic demand for tractors, seeders and grain combine harvesters is highest every year.
In 2018, the weakness of wheat will directly affect the demand for agricultural machinery in these major wheat producing areas. Except for the large-scale planting areas of rice and economic crops in Jiangsu and Anhui and scattered demand for agricultural machinery, the impact is not expected to be large. Henan, Shandong In Hebei, the main crops are wheat and corn. According to the market price of wheat and corn each year, the acreage of the two crops is expected to increase. The area planted to maize in 2018 is expected to rebound while the area under wheat planting is likely to decline , These three provinces and wheat full mechanization related to agricultural machinery products will decline.
2, tractors, planters and combine harvesters will decline the most
The whole process of wheat land consolidation, cultivation, planting, harvesting, management and post-processing basically achieved full mechanization. In the three major crops, the yield of wheat was the highest. If the wheat acreage was reduced in 2018, it would be the most affected Must be a wheat-growing machine, followed by a dual-use machine.
We judge the tractor and the wheat seeder, and the cereal combine harvester these three kind of farm machinery to receive the greatest influence, next the rotary cultivator, the subsoiling machine, the hydraulic overturning plow, sprayer influence.
It is also important to remind that the demand for fully fed rice harvesters will also be directly challenged as fully fed rice harvesters continue to erode the wheeled grain harvester market in recent years and new machines for wheat harvesting each year It is estimated that there are 15,000 units.
3, there will be a chain effect, which may affect the entire agricultural machinery market winter wheat market
A butterfly from the tropical Amazon rainforest in South America, occasionally with a few wings, may cause a tornado to Texas in the United States two weeks later. This is the 'butterfly effect.'
The same agricultural machinery industry will have this phenomenon.In the winter wheat area, the demand for wheat machinery is the industry benchmark, tractors, grain combine harvesters if the sluggish demand, it will give the market a signal of the overall decline in demand for the industry.
Such as the wheat combine harvester every year in late March and early April the market started, the spring market in the northern region is based on the sale of wheat combine harvester as a starting point, whether this signal is true or false, always affect the manufacturing enterprises, distributors And the user's mentality, but the confidence of the market waver, this year's market will basically be over.
Therefore, it is determined that the market of wheat will not be good in 2018, the area under cultivation and the price will drop, and the related agricultural machinery products will also be affected. In particular, the impact on several major producing areas will be even greater.