Prospects for Developing Agricultural Machinery Market in Western China

With the increase in the level of agricultural mechanization and the promulgation and implementation of relevant national agricultural policies, the development of the agricultural machinery market in the west has ushered in a good opportunity.

Development Status Agricultural machinery circulation in Southwest China is more developed than in Northwest China, mainly in Sichuan, Chongqing, Yunnan, Guizhou and Guangxi. In the northwest region of Gansu, Ningxia and Qinghai, because of the backwardness of economic development, poor natural environment, and geographic location, agricultural mechanization and agricultural machinery circulation in the three regions are lagging behind; Xinjiang, though located at the border, has adopted large-scale agricultural production methods for its production and construction corps. The level of mechanization for tillage and harvest has always been higher; Shaanxi and Inner Mongolia have enjoyed relatively rapid economic development in recent years. The supporting policies and inputs of local governments for agricultural mechanization have also increased, which has also led to a rapid increase in the level of local agricultural mechanization. However, in the agricultural machinery fittings market, there is no one in the entire western region that has a nationwide influence, scale, and mature operation. Most agricultural machinery parts in the western region are purchased from the agricultural machinery parts market in Hebei and Henan.

The operating environment needs to be improved. According to the survey, the projects in the major agricultural machinery distributors in the western region seem to be in good condition, but since most of them are in the preliminary stage of development, the operation and management mechanism has not yet been perfected, and the dealers have been decentralized for a long time. The market effects of market policies and government policies do not play well and restrict the further development of the market. In addition, some self-employed, unprofessional technicians and self-employed individuals who have no financial strength through landing operations have caused a large number of unqualified agricultural machinery products to enter the field of agricultural machinery circulation, seriously disturbing and impacting the normal business order of the market.

The coexistence of opportunities and risks In recent years, with the increase in the purchase subsidies for agricultural machinery and the intensified demand in the market, the agricultural machinery industry has maintained an overall growth rate of over 13%. The "12th Five-Year Plan" of the agricultural machinery industry proposed that the agricultural machinery industry's total production value will increase from 280 billion yuan in 2010 to 400 billion yuan in 2015. Due to the lack of large-scale agricultural machinery companies in the western region, local governments have great support for the development of agricultural machinery projects. Of course, there are certain risks in the development of the agricultural machinery market in the west.

Affected by planned economy and local protectionism, in the agricultural machinery market, production and distribution companies all have certain fixed customers. In particular, large and medium-sized agricultural machinery retail markets and small-scale agricultural machinery state subsidies products have been monopolized by a few enterprises and occupy a certain market share. Market segmentation is serious.

In addition, there are price risks. The agricultural machinery market mainly sells agricultural machinery products. Due to the high price of steel products in recent years, the cost of steel products accounts for a large proportion of the total sales cost of agricultural machinery, and there is a risk that the prices of products will increase. Due to fierce market competition in the northwestern region, farmers are more sensitive to product prices and have lower brand loyalty. Once price fluctuations occur, market competition will be further fiercer.