SKC forecasts machinery sales to rise on rice prices
Farm machinery maker Siam Kubota Corporation (SKC) is optimistic about sales revenue rising 10% to 56 billion baht this year, mainly driven by an upturn in the country’s rice prices.
President Hiroto Kimura said rice prices are climbing and the government’s policy is gradually decreasing stockpiles.
“The rice market, jasmine rice in particular, is expected to grow on demand from abroad, increasing prices,” he said.
As farm product prices rise, SKC projects the country’s agricultural machinery market to grow by 5-10% to 55 billion baht this year.
For 2018, SKC plans on importing agricultural machinery from Japan that is equipped with higher technology and autonomous features.
“The government has a policy to promote innovative technology through S-curve industries, which include automation and robotics clusters, presenting huge opportunities for SKC,” Mr Kimura said.
Moreover, SKC plans to expand its production capacity for tractors, serving demand growth in Thailand and Asean.
Founded in 2010, SKC is a 60:40 joint venture of Japan’s Kubota Corporation and Siam Cement Group.
The company operates factories in Pathum Thani’s Nava Nakorn Industrial Park and Chon Buri’s Amata Nakorn Industrial Estate, with annual production of 240,000 and 80,000 units, respectively.
The Nava Nakorn factory makes diesel engines and power tillers. The site also serves as Kubota’s parts distribution centre and R&D hub for Asean.
Tractors and combine harvesters are made at the Amata Nakorn facility.
“SKC utilises its capacity to produce up to 100,000 tractors, so we have to expand further, in line with market demand,” Mr Kimura said.
Last year, SKC reported total revenue of 51 billion baht, up 2% from the previous year.
Revenue generated domestically represented 55% of the total, while exports accounted for the rest.
The company’s primary markets abroad are Cambodia, Laos and Myanmar, while SKC also has a presence in other Asean states and Latin America.
Thailand’s agricultural machinery market was valued at 50 billion baht last year, compared with 46-48 billion in 2016.
SKC also imports mini-excavators from Japan, expecting sales of 2,000 units in 2018.
In April 2015, the company turned its attention to the mini-excavator segment to cope with the country’s growing construction market.
“We are witnessing a lot of potential for the mini-excavator market, driven by the government’s infrastructure megaprojects and new construction being initiated by the private sector,” Mr Kimura said.