In recent years, the country has elevated food security to a strategic height, and the development of agricultural mechanisation has gained unprecedented attention.2023, the construction of high-standard farmland in many parts of the country is in full swing: Xinjiang has completed 4.35 million mu of arable land for new construction and renovation, and Inner Mongolia and Heilongjiang have added 8.5 million acres and 8.686 million acres of high-standard farmland, respectively. It is worth noting that mountainous areas such as Yunnan, Guizhou, Sichuan and Gan are breaking through the terrain limitations through modern mechanical means to develop speciality agro-forestry industries. These initiatives have directly boosted the market demand for agricultural machinery such as seeders and harvesters.
With the deep implementation of the 'agricultural machinery scrapping and renewal subsidy implementation guidelines', a large number of over-service equipment into a concentrated phase-out period. Industry research shows that China's tractors, combine harvesters and other major agricultural equipment, about 30% has exceeded the legal end-of-life. This policy not only accelerates the renewal of the stock of equipment, but will continue to drive the incremental demand for agricultural castings market. In the domestic market, the acceleration of agricultural modernisation is triggering a profound change in the demand structure. 2020 agricultural castings accounted for 10.4% of the total demand for castings, second only to the automotive industry. With the popularity of smart and electric farm machinery, this share is expected to rise to 11%-12% in 2025. Especially in the northeast grain silo and Xinjiang cotton area, the penetration rate of high-end equipment such as high-powered tractors and intelligent cotton pickers is increasing at a rate of 5% per year. Overseas market performance is also bright. With the 'Belt and Road' east wind, China's agricultural machinery exports for three consecutive years to maintain a growth rate of more than 15%. Southeast Asia is particularly prominent, Vietnam, Thailand and other major rice-producing countries import rice transplanter, dryer and other equipment from China more than 20,000 units per year, leading to the simultaneous growth in demand for supporting castings. Customs data show that the first half of 2024 agricultural castings exports surged 22% year-on-year, a record high.
Therefore, the future of agricultural castings, such as agricultural machinery casting, agri parts and accessories, agricultural casting, etc. will have favourable development conditions.