Agriculture and Forestry Machinery Industry in Canada

General remarks:

1. The sources should be added
   1. The way we do it is like this[1]
   2. Also, since there are now sources, I cannot check how valid are your points
2. It is always better to talk about the movement rather than static:
   1. E.g. the point with loans. Less loans, more loans than in 2012 (2011, 2012)? What is the trend, and this trend is the result of what? (not just 2013)
   2. With agricultural land. Increasing? Decreasing? The trend.
3. Hard to understand the main story (and I think it is more related to the loans, and cutting of subsidies than with rich harvest)
4. I am also adding the competitive landscape from last year, so you can finish the company you didn’t know.

Headlines

• Market for agricultural and forestry machinery grows 15% in 2013 due to increasing capacities of domestic and main import/export partner USA farms and consequently high farm incomes that encourage farmers to invest in agriculture machinery.[G1]
• Industry increasingly concentrated, with top 5 companies: Buhler Industries Inc., John Deere Ltd., CNH Canada Ltd., Bourgault Industries Ltd., La Coop Purdel – increasing their revenue Government gives loans and insurance incentivise farmers to buy new equipment or update old machines[GL2]

• Domestic market grows slightly more than sales over 2013, mainly due to cost savings arising from adoption of innovative technologies[GL3]
• Maybe a point about cutting government subsidies
• Loans
• Something from production, like innovation trend or demand abroad for Canadien machinery ( I still didn’t get why exactly is the Canadian machinery demanded)
• Industry set to see 3% turnover growth in 2014 due to accelerating mechanisation and adoption of precision farming in agriculture, coupled with strong USA demand for Canadian-made machinery

Market Trends

• The Canada’s market for agricultural and forestry machinery was valued C$5.4 billion in 2013, up by astounding 15% from 2012. Year-on-year [G4]market growth was mainly attributed to the agriculture industry and its growing automation, while increasing application of innovative products such as precision farming equipment also had a positive impact. Farms sought to increase production capacity and capture the benefits of high revenue coming from high crop prices. [G5]Furthermore, major what? trends in Canada and other high-income countries included a reduction in the number but growth in the size of farms[G6], which fuelled demand for sophisticated agricultural equipment.

Farm size in Canada is growing similar to other high 0 income countries, which fuels demand for sophisticated agricultural machinery.

• The agriculture industry was main buyer of agricultural and forestry machinery in 2013, including both purchases for investment and business purposes. There were around 200 000 farms operating in Canada in 2013, with more than 51 million hectares of agricultural land classified as dependable agricultural land [GL7]. An excellent 2013 key grains such as… and oilseeds harvest in Canada was a main contributor for strong which?? sector performance. Consequently, net farm incomes in 2013 were as high as in 2012 , fuelling investment in capacity expansion, which led to 12% growth of agriculture sector spending for investment and business purposes.

• High agriculture revenue and consequent spending on agricultural and forestry machinery was a result of several key factors. Primarily, favourable weather conditions , translated in record 2013 crop production and allowed farmers to capitalise on higher crop prices, which remained high till the end of the year. In addition to that, although the number of farms in Canada is steadily falling since 2006 (taking in to perspective from 2006 to 2011 it fell 10.3% or by 24 thousand farms), they are getting bigger, which resulted in economies of scale and capital concentration. This naturally allowed greater spending on state-of-the-art agricultural equipment, adoption of precision farming, the use of new technologies to optimize agricultural yields and reduce costs. Precision farming employs innovations such as global positioning systems for vehicle and row tracking that allow farmers to use previous yield information and soil resistivity data to minimise planting overlaps.[G8]

• Farm credit approved 47 046 new loans in 2012-13, with average size of loan approved rising to C$162.406, giving farmers incentive to acquire new equipment. [GL9] However federal program payments, which include primarily payments made directly to agricultural sector? producers, were set to decrease from C$1.3 billion in 2012, to C$1.2 billion in 2013 and during the same 2 year period, provincial program payments were also set to decrease from C$ 1.6 to C$1.5 billion[G10].

• In 2013 majority – over 59% of domestic market demand was accounted for by foreign producers. Primarily from USA , which claimed 70% of all domestic market demand. [G11]Innovative technological advancements related to precision farming equipment, new advanced agriculture tractors and soil preparation machinery, backed by geographic proximity and NAFTA membership, allowed USA to remain Canada’s most import partner in agricultural machinery. Meanwhile, second Canada’s foreign supplier – Germany, managed to increase its market share from 8% in 2012 to 9% in 2013. This can be attributed to record high farm incomes in Canada and farmers, who valued Germany’s reputation as a producer of high-end agricultural machinery. This fostered demand for made-in-Germany machinery. [G12]

• Agricultural tractors were most demanded machinery in the market, accounting for 34% of the demand in 2013, increasing from C$1.6 billion in 2012 to C$1.8 billion by 10%, while harvesting and threshing machinery increased by 13% from C$1.3 to C$1.4 billion, which respectively accounted 26% of the demand in 2013. This increase of demand for the machinery can be explained by excellent 2012 year for farmers, who were able accumulate profit and bright expectations, that in 2013 grain production increase to 97 million tonnes, compared to 77 million tonnes, encourage farmers to plan ahead and to invest in new agricultural tractors, harvesting and threshing machinery. [G13]

Production Trends

• In 2013 production of agriculture and forestry machinery in the Canada was C$ 4.7 billion, up 14% from previous year. Turnover of local producers was driven by reboots demand from domestic market as well as 7% growth in exports. As the result of increased agriculture volume, high net farming income and high demand for Canadian machinery in biggest export partner USA, local manufacturers ran at full capacity throughout 2013. Tight competition in the agriculture industry, led farmers[GL14] to seek cost minimisation, which could only have been most efficiently achieved using sophisticated machinery – Canadian agricultural machinery industry had to offer. [GL15]

• Even though exports [GL16]percentage of production output fell from 53% in 2012 to 51%in 2013, exports grew by 7% from C$2.2 to C$2.4 billion. It was due to the fact that domestic demand grew faster than exports. Canada’s export partners were mostly industrialised market economies where agricultural activity is capital-intensive and reliant on advanced technology. The biggest trade recipients remained USA claiming 79% of Canada’s exports, due to geographic proximity and NAFTA membership, allowed Canada to remain the USA’s primary import partner in agricultural equipment. As for 2013, Canadian soil preparation machinery and harvesting and threshing machinery each accounted for a third of agricultural and forestry machinery imports to the US.

• 2013 was a year of innovations in agricultural and forestry machinery industry[GL17] – with breakthrough in precision farming. New ways at improving tillage by introducing tools capable of variable-rate tillage, vertical tillage and improved residue management, was leading innovation. Other significant areas of innovation were: equipment of smaller magnitude, directed at easier way to transport and to let tractors and planters achieve higher speed[GL18].

• Decreasing number of farms, but ever expanding in size has been long lasting trend in Canada, bigger farms are capable of buying more expensive and sophisticated machinery. In addition to that, StatsCan also found a shift away from livestock-based farms to crop-based operations, such farms require more machinery to be ran efficiently than livestock-based. Naturally large corporations in machinery industry were more successful in satisfying demand for such equipment, due to high capital requirements, massive fixed costs and the importance of economies of scale. Smaller firms were able to compete in agricultural and forestry machinery industry by capitalizing their sales by offering specialised equipment such as tractor attachments to smaller farmers, who were trying to compete with bigger farmers as well. [G19]

• Production volume expanded by 14%, leading to stunning increase in profit by 20% over 2013, was among the largest among developed countries. Comparing to a profit margin of USA, which increased by moderate 4% but remained high, outperforming such countries as Italy, France, Germany and the UK. [GL20]

• Due to the rising popularity of precision-farming technologies, which started in 2011, top agriculture machinery manufacturers started to employ more professionals to create and develop more state-of-art [GL21]data hosting technologies, cloud-based applications, and other modern solutions. This translated into boost in wages, to attract best qualified personnel through 2012 and 2013. These strategies as well as 7% increase in number of employees, led to 6% increase of turnover per employee. [GL22]

Competitive Landscape

They all manufacture agricultural machinery? But how are they different? What kind of machinery?

• The industry of agricultural and forestry machinery was becoming more concentrated in production terms with five leading entities – Buhler Industries Inc., John Deere Ltd., CNH Canada Ltd., Bourgault Industries Ltd., and La Coup Purdel in 2013.

• Majority of enterprises operated in the industry were micro-sized and small, mainly producing specialised equipment such as tractor attachments. Due to high capital requirements, massive fixed costs and the importance of economies of scale, the bigger share of turnover was captured by the largest producers.

• Buhler Industries Inc is headquartered in Winnipeg, Manitoba, Canada, manufacturer and distributor of agricultural equipment. Factories in Morden and Winnipeg, MB, Salem, SD, Willmar, MN and Fargo, ND, build tractors, front-end loaders, augers, compact implements and more. Buhler Industries maintains several well-stocked parts warehouses. 2007, Combine Factory Rostselmash Ltd, a major combine manufacturer located in Rostov-on-Don, Russia, acquired 80% of the common shares of Buhler Industries. With additional investment in engineering, research and development and production, the company is moving forward. The dealer / distribution network in North America remains unchanged, but the Rostselmash network of more than 200 dealers in Russia, Ukraine and Kazakhstan now has access to the products built by Buhler Industries. 2013 marked the launch of a highly anticipated product known as the Versatile DeltaTrack. The new Versatile 260, 290 and 310, a front-wheel assist fixed frame tractor, entered production. This interim Tier 4 compliant tractor features a Cummins QSL 9.0 mated to a 16-speed powershift transmission. This new row crop tractor uses the Versatile HQ cab, the biggest cab in the agriculture industry, featuring new ergonomic controls and unmatched visibility and comfort. News?

• CHN Canada Ltd. is a company based in Saskatoon, Canada, which produces industrial and commercial machinery products, including farm machinery and equipment. CNH has earned a reputation for product quality and superior design in seeding, tillage and chemical application equipment. In particular, air seeding systems stand alone in terms of innovation, efficiency and effectiveness[GL23]. News?

• John Deere Ltd. is a company based in the Canada, which design, manufacture and distribute agricultural and construction equipment, turf and forestry equipment and additional supporting businesses – Financial Services, Power Systems, Parts Services, and the Intelligent Solutions group. John Deere Ltd., future plans are to expand globally with a focus on six key areas – the United States and Canada, Europe, Brazil, Russia, India, and China. News?

• Bourgault Industries Ltd. is a company based in the St. Brieux, Saskatchewan, Canada, which design, manufacture and distribute farm equipment. Bourgault Industries Ltd. is the world leader in air seeder technology. In 2011 company introduced Model 7950 air seeder, with four main tanks totalling 34 000 litres and full inter-tank flexibility that Bourgault air seeders are renowned for. News?

Prospects

• The industry for agriculture and forest machinery is expected to enjoy a moderate 3% growth of turnover in 2014. The 2015 Canadian Agricultural Outlook projects that net income for Canadian farmer will continue to grow in 2014. In addition to that sizable gains realised during 2012 and 2013, and modest global demand for agriculture equipment, are anticipated to sustain demand for agricultural and forestry machinery in 2014.

Talk about continuous decrease in subsidies

Talk about how usa agricultural sector is projected to expand and have positive growth on exports

Talk about sift towards grain farming rather than live stock, this type of farming should be requiring more machinery to process land ( my guess) can we confirm?

• In the medium and long term prospects for Canada’s agriculture and forestry machinery producers are positive, particularly in terms of foreign opportunities. Growing demand for food and rising crop prices are set to fuel farm income worldwide and spur robust demand for advanced agricultural equipment. The necessity for cutting-edge machinery will be particularly high in regions characterised by rapid urbanisation and declining crop-land areas, as well as emerging markets in Eastern Europe and Africa, where consolidation will make capital investments more attractive and attainable.

• Application of new technologically-innovative farming practices, such as precision farming, is expected to fuel demand for agricultural equipment over the forecast period. which will as well drive the turnover of the industry under review. Demand for precision farming equipment is predicted to grow over the forecast period as young and open to what tech has to offer farmers continue to enter the national agriculture industry.[GL24]

Competitive Landscape (2012)

• CNH Canada Ltd is a Canada-based subsidiary of CNH Global NV, which is majority owned by Fiat SpA. CNH manufactures and markets agricultural and construction equipment with 37 manufacturing facilities located throughout Europe, North America, Latin America and Asia. In Canada the company operates a manufacturing centre in Saskatoon, SK, where it employs around 700 full-time workers. CNH Global NV operates through 11,300 dealers in approximately 170 countries and employs around 28,800 workers globally, with 9,900 in North America.
• Buhler Industries Inc is a Canadian company owned by Novoye Sodruzhestvo Industrial Group, which manufactures and sells agricultural equipment. Among the company’s products are tractors, self-propelled and pull-type sprayers, front-end loaders, grain augers, snow blowers, tillers, finishing mowers, feed processing equipment, seeding and tillage equipment, hay and forage equipment, among others. Buhler Industries Inc has several manufacturing plants in Morden and Winnipeg (Manitoba), Vegreville (Alberta), as well as sites in the US in Fargo (North Dakota), Salem (South Dakota) and Willmar (Minnesota). The company employs more than 1,000 workers in North America.
• John Deere Ltd is a Canadian subsidiary of Deere & Co, which is an American company specialised in the manufacture of construction equipment, farm and turf equipment and forestry equipment. The company offers such products as loaders, combines, corn pickers, cotton and sugarcane harvesters, tillage, seeding and application equipment. It owns 19 plants in the US and Canada and plants in Brazil, China, France, Germany, India, Israel, Mexico, and other countries around the world.
• MacDon Industries Ltd is a Canada-based company which designs, manufactures and sells harvesting equipment. Among the company’s products are self-propelled windrowers and headers, pull-types for hay, draper headers for combines and pick-up headers. MacDon Industries Ltd operates a manufacturing facility in Winnipeg, Manitoba, Canada, which occupies over 600,000 square feet of building space.
• Bourgault Industries Ltd is a company based in Canada, which designs, manufactures and sells agricultural equipment. Among the company’s products are air seeders, air drills, tillage units, harrows, packers, fertiliser application systems, and others.

[1] A Source

[G1]Per ilga antraste

[GL2]No companies. Unless its an important merge or news which is important to overall industry. In this case only one company news would come to head line. Not a summary list.

[GL3]If its meant to be market grew more than production? I think that reasons are confusing. I can not see the numbers but it seems like a. market is driven by local demand b. production by exports and market? If yes , I agree the statement is lacks strength in logic

[G4]What year? I would suggest explaining what is the difference.

[G5]When?

[G6]Is a new trend, still applicable to 2013? I would expect to read about it later in the txt, where a comparison is done of average farm size e.g. in year x versus 2013.

[GL7]to try to give an evaluation – is what does this number represent. E.g. is it more than e.g. usa or some other big nation. In general..

[G8]Repetitive, combine withe the 2^nd point – Maybe clean up some facts but leave the size info.

[GL9]I guess I want to see movement but simple fact of how different it is from 2012 more less would be enough.

[G10]Very important point. More important than harvest, or land are….  SO first, cutting subidies, decond, agricultural loans. The interesting things is how come with subsidies down investment grew that much? But I guess it’s a controversy which is difficult to answer. One would expect a jump in loans,. Even then, subsidies declined 2 bil, while there is 100 000 of loans, not even close to compensate.

[G11]Imports?

[G12]Not sure, quite weak argument, I agree, its enough in terms of us. Unless he would be listing the companies and brands and new real products introduced. I would love toread about precision faring. Which company is has offered such farming machinery in 2013 , it would be a good illustraiont

[G13]Gaun, repetitive. If you want to say it, add it above/ . I guess agree . I would say add that his buyers analises is strong enough, no need to empty talk on sectors.

[GL14]Who’s

[GL15]Sounds like an advertising slogan. I doubt that Canadian machinery is that special, and if it is, you have to tell what specific machinery or something is that important/demanded.

[GL16]Since market is already analysed, in this case export is second most important factor to be analysed and presented in the production sector. I would doubt the analytical need to analyse export share change. Its enough to say its curtail, and it grew a little less by (something, not share) this time than local market. In the intro though always clearly state if local production is driven by export growth or local market , in this case its local market. Yet exports remain curtail as its half of revenues.

[GL17]This argument needs support and examples. E.g. this this company, designed,/introduced and etc. Please expand this point.

[GL18]

[G19]Labiau prie market tinka I would delete it, the only interesting thing here that I found interesting is livestock-based farms to crop-based operations, this is important and should be mentioned in bueyrs. ( or agricultural analyses of the market) However, I do not see that text after that translates into explanation what it meant for producers.I would say its just a good fact to add to the positive facts of increasing size of farms, and good crop prices.

[GL20]Descriptive.

[GL21]ADVERTISING

[GL22]GUESSING

[GL23]Not a commercial. “earned a reputation for product” doesn’t fir

[GL24]Not clear what and why?

General remarks:

1. The sources should be added
   1. The way we do it is like this[1]
   2. Also, since there are now sources, I cannot check how valid are your points
2. It is always better to talk about the movement rather than static:
   1. E.g. the point with loans. Less loans, more loans than in 2012 (2011, 2012)? What is the trend, and this trend is the result of what? (not just 2013)
   2. With agricultural land. Increasing? Decreasing? The trend.
3. Hard to understand the main story (and I think it is more related to the loans, and cutting of subsidies than with rich harvest)
4. I am also adding the competitive landscape from last year, so you can finish the company you didn’t know.

Headlines

• Market for agricultural and forestry machinery grows 15% in 2013 due to increasing capacities of domestic and main import/export partner USA farms and consequently high farm incomes that encourage farmers to invest in agriculture machinery.[G1]
• Industry increasingly concentrated, with top 5 companies: Buhler Industries Inc., John Deere Ltd., CNH Canada Ltd., Bourgault Industries Ltd., La Coop Purdel – increasing their revenue Government gives loans and insurance incentivise farmers to buy new equipment or update old machines[GL2]

• Domestic market grows slightly more than sales over 2013, mainly due to cost savings arising from adoption of innovative technologies[GL3]
• Maybe a point about cutting government subsidies
• Loans
• Something from production, like innovation trend or demand abroad for Canadien machinery ( I still didn’t get why exactly is the Canadian machinery demanded)
• Industry set to see 3% turnover growth in 2014 due to accelerating mechanisation and adoption of precision farming in agriculture, coupled with strong USA demand for Canadian-made machinery

Market Trends

• The Canada’s market for agricultural and forestry machinery was valued C$5.4 billion in 2013, up by astounding 15% from 2012. Year-on-year [G4]market growth was mainly attributed to the agriculture industry and its growing automation, while increasing application of innovative products such as precision farming equipment also had a positive impact. Farms sought to increase production capacity and capture the benefits of high revenue coming from high crop prices. [G5]Furthermore, major what? trends in Canada and other high-income countries included a reduction in the number but growth in the size of farms[G6], which fuelled demand for sophisticated agricultural equipment.

Farm size in Canada is growing similar to other high 0 income countries, which fuels demand for sophisticated agricultural machinery.

• The agriculture industry was main buyer of agricultural and forestry machinery in 2013, including both purchases for investment and business purposes. There were around 200 000 farms operating in Canada in 2013, with more than 51 million hectares of agricultural land classified as dependable agricultural land [GL7]. An excellent 2013 key grains such as… and oilseeds harvest in Canada was a main contributor for strong which?? sector performance. Consequently, net farm incomes in 2013 were as high as in 2012 , fuelling investment in capacity expansion, which led to 12% growth of agriculture sector spending for investment and business purposes.

• High agriculture revenue and consequent spending on agricultural and forestry machinery was a result of several key factors. Primarily, favourable weather conditions , translated in record 2013 crop production and allowed farmers to capitalise on higher crop prices, which remained high till the end of the year. In addition to that, although the number of farms in Canada is steadily falling since 2006 (taking in to perspective from 2006 to 2011 it fell 10.3% or by 24 thousand farms), they are getting bigger, which resulted in economies of scale and capital concentration. This naturally allowed greater spending on state-of-the-art agricultural equipment, adoption of precision farming, the use of new technologies to optimize agricultural yields and reduce costs. Precision farming employs innovations such as global positioning systems for vehicle and row tracking that allow farmers to use previous yield information and soil resistivity data to minimise planting overlaps.[G8]

• Farm credit approved 47 046 new loans in 2012-13, with average size of loan approved rising to C$162.406, giving farmers incentive to acquire new equipment. [GL9] However federal program payments, which include primarily payments made directly to agricultural sector? producers, were set to decrease from C$1.3 billion in 2012, to C$1.2 billion in 2013 and during the same 2 year period, provincial program payments were also set to decrease from C$ 1.6 to C$1.5 billion[G10].

• In 2013 majority – over 59% of domestic market demand was accounted for by foreign producers. Primarily from USA , which claimed 70% of all domestic market demand. [G11]Innovative technological advancements related to precision farming equipment, new advanced agriculture tractors and soil preparation machinery, backed by geographic proximity and NAFTA membership, allowed USA to remain Canada’s most import partner in agricultural machinery. Meanwhile, second Canada’s foreign supplier – Germany, managed to increase its market share from 8% in 2012 to 9% in 2013. This can be attributed to record high farm incomes in Canada and farmers, who valued Germany’s reputation as a producer of high-end agricultural machinery. This fostered demand for made-in-Germany machinery. [G12]

• Agricultural tractors were most demanded machinery in the market, accounting for 34% of the demand in 2013, increasing from C$1.6 billion in 2012 to C$1.8 billion by 10%, while harvesting and threshing machinery increased by 13% from C$1.3 to C$1.4 billion, which respectively accounted 26% of the demand in 2013. This increase of demand for the machinery can be explained by excellent 2012 year for farmers, who were able accumulate profit and bright expectations, that in 2013 grain production increase to 97 million tonnes, compared to 77 million tonnes, encourage farmers to plan ahead and to invest in new agricultural tractors, harvesting and threshing machine