4th Quarter 2019
Equipment markets continued the contraction that started in Q1 2019 and accelerated during the second half of the year. During the fourth quarter, global shipments declined by an additional 11% (units) and the value of these deliveries dropped by an estimated US$150 million (down 9% vs Q3). On a year-over year basis, unit shipments in 2019 were 18% lower than during 2018 while total estimated value declined by 12%. The latter reflects a continued shift toward larger/higher-value products and, within product lines, larger size classes.
The quarterly decline was due almost entirely to a reduction in mining truck deliveries which were off 16% vs Q3. Shipments of excavating equipment (hydraulic shovels/excavators, wheel loaders, electric/rope shovels) and dozers were virtually unchanged. This is in sharp contrast to the decline recorded during Q3 when shipments for these product lines accounted for a substantial share of the overall reduction in equipment deliveries.
There was a wide divergence in equipment deliveries among geographic regions with sharp reversals of changes recorded during Q3. Whereas shipments to North and Latin American mines increased Q3 over Q2 (vs. sharp contractions for other regions), they declined sharply during Q4 while shipments to Asia and Russia/CIS increased modestly. The distribution by mineral markets likewise exhibited wide divergence. Copper – down 53%; oil sands down 28%; coal down 2%; gold up 49%; iron up 8%. As Parker Bay has noted in the past, changes in quarterly shipments are often not reflective of longer-term shifts in product/geographic/mineral markets.
Possible revised reports by participating manufacturers plus additions for non-participating manufacturers will likely raise the current shipment totals. But experience indicates such changes are likely to be minor (1-4%). And these will almost certainly not change the fact that equipment markets declined substantially during 2019 albeit not nearly as severely as during the first year of the 2013-2015 contraction.