Germany’s mining equipment manufacturers have hardly been affected by the financial crisis so far. For the coming year, they are predicting that the total turnover will increase by 10% to €3.3 billion. Peter Jochums, Chairman of the VDMA German Mining Equipment Association, noted this at the annual press conference in Zeche Zollverein. The VDMA says: “Recently, some orders have been cancelled, especially by East European customers; however the manufacturers are not affected by massive drops like in other economic sectors.”
“Our order books are well-filled at least for the coming year”, underlined Jochums. However, he expects a “temporary decrease” for 2010 as a consequence of the financial crisis, but that is really unpredictable at the moment. Reliable data about how the crisis affects the mining equipment sector are not available, the VDMA says.
For the 2008 final figures, the manufacturers expect a decrease of total turnover of 10% to €3 billion. In the past two years, the total turnover increased by 18%. It is for this reason that the decrease could be absorbed, Jochums explained. In Germany, uncertainty grows with regard to the impending phasing out of hard coal production in 2018. This concern is reflected in the figures also. Therefore, Jochums expects a loss in domestic sales of 17% to €390 million for this year. For 2009, a further decrease of 5% is estimated. However, Germany still remains the largest and a very important sales market.
The turnover abroad will be approximately €2.6 billion this year. This is an indicated decrease of 11% as compared to 2007. Due to high growth rates in past years, this situation could be “handled well” though, said Jochums; especially since the industry expects an increase in foreign sales of 11% to €2.92 billion despite the financial crisis in the coming year. The order books are well-filled.
Like last year, the biggest foreign sales market is again Russia in 2008. Final figures could show exports increased by €20 million to €280 million. For 2009, Jochums assumes a decrease of some 10% due to the financial crisis. This is partly because orders have been stretched or cancelled. In order to counteract this development, German manufacturers tried to use Hermes tools or Hermes financing via German banks.
In China, the second most important market, German mining equipment manufacturers probably will increase their sales by only €1 million to €210 million for 2008. Due to the state subsidies many companies received, the Chinese developed into serious competitors on the global markets according to Jochums. Between 2005 and 2007, exports of Chinese mining equipment manufacturers more than doubled from €871 million to €1.8 billion. Exports to the USA quadrupled and to Russia even decupled. Despite this, Jochums expects the same turnover for the coming year.
This year, exports to the USA will probably have declined from €252 million to about €200 million. Uncertainties due to the financial crisis, declining commodity prices and related smaller investments of large mining companies are the reasons put forward by Jochums. Due to the almost “good mood” the US American and Canadian operating companies are in, the turnover of 2008 is assumed to be maintained for 2009. Jochums anticipates potential future markets in India, Indonesia and the Philippines.
