Global business climate low


The global business climate is back at the low level of October 2014. Source: AFDJ eNews

Although the global downturn might has come to a halt, at least for the next six month a global recovery is not in sight according to the Agrievolution Business Barometer.

On a global scale, the sector seems more likely to stabilize at the current low level.

In comparison with October 2014, the current situation is significantly worse, while the future expectations improved and are now slightly in the positive.

However, compared with the last two surveys in 2015, the future expectations are far more muted – in particular the expectations from companies located in Western Europe.

This is the main cause for the relapse of the global business climate.

The further deterioration of the current business of the US industry is an additional reason.

Regarding the global industry’s expectations for the single markets in the next six months, East Asia is leading the ranking, followed by Africa.

For North and Latin America a majority of the survey participants expect turnover decreases.

A large majority of Japanese and Russian industry representatives, but also one third of the Turkish participants, report about changes in government programs with positive effects on demand for agricultural machinery in their countries.

This could be one explanation, why contrary to other locations, the volume of orders did not decrease in Russia, Japan and Turkey.

Apart from Russia the general mood of farmers remains largely negative due to the low commodity prices and thus profitability. This might not change in the short-term.

The industry’s evaluation of the impact from energy production to its end customer is worst in the US.

Europe leads the negative ranking concerning the impact from crop and animal production.

On the other side, Russian participants report high credit loan restraints.