OREANDA-NEWS. August 7, 2012. Russia’s total production of tractors rose 12.0% year-on-year to 10,894 units in the first six months of 2012, according to ASM Holding analysts’ data. Grain harvester production in Russia rose 18.0% year-on-year to 3,755 units in H1 2012, while output of forage harvesters rose 1.4 times on the year to 922 units in the period.

Based on the manufacturers’ results in January-June, ASM Holding analysts give their current annualized Russia tractor and harvester production forecast for the full year 2012: tractors – 22,795 units, grain harvesters – 7,857 units, forage harvesters – 1,929 units. The forecast of tractor production surpasses the last five years’ best result (18,805 units in 2008) by 21.2%. The annual forecast of grain harvester output is virtually equal to the best production result (7,864 units in 2008), and the annual forecast of forage harvester output surpasses the best result (1,192 units in 2011) by 61.8%.

However, the positively looking prospects cause also some anxiety. With the expected output of 22.8 thousand tractors in 2012, the share of domestic models has already squeezed to 20%, while all the pre-crisis (2008) output volume of 18.8 thousand tractors was provided by domestic manufacturers. The overwhelming proportion of the current Russia’s tractor output is taken by assembly of Belarus tractors (58.5%) being gradually ousted by local assembly of Western makes (21.3%). In both cases, the main part of the product value (in the form of SKD kits) is created outside Russia, while a comparatively small value added in Russia does not require much labour and cannot ensure full-scale employment of workforce. The loss of jobs in Russia for account of creation of jobs abroad is confirmed by ASM analysts’ data on employment in Russia’s agricultural engineering industry: the number of employees has fallen from 40.5 thousand persons in 2008 to about 20 thousand persons by now.