(Bloomberg) -- Caterpillar Inc. is signaling to the market that demand from China is going to decline in 2022, despite machinery needs across most of the globe improving.

Chief Financial Officer Andrew Bonfield said the drop will be driven mostly by a slowdown in China’s construction market, which could see benchmark sales of 10-ton and above excavators tumble between 10% to 50%. The company said in a statement that sales of construction equipment in the nation slumped during the fourth quarter as end-user demand waned. 

“Overall, the market was about flat in 2021, but obviously we do expect the market to decline in 2022 given the construction outlook,” Bonfield said in a phone interview. “There’s a range of forecasts out there -- we look in the 10-ton and above excavator market -- I think the range of forecasts out there are -10% to -50%, so it’s a very broad range. Your guess is as good as mine at the time.”

Chinese stocks extended a nearly $1.2 trillion rout this month as worries continued to mount over China’s growth and property market distress, which cast doubts over a swift turnaround. While investors do keep watch on Caterpillar’s business in the Asian nation, the country only represents about 5% to 10% of the company’s total business sales, Bonfield said. 

“We lack the comparatives for the fourth quarter,” Bonfield said. “China was down a lot, but that was because we had a very strong fourth quarter last year and a more normal fourth quarter this year.”

Caterpillar reported fourth-quarter earnings early Friday, saying it raised prices to stay ahead of increasing raw-material costs and worked with suppliers to alleviate bottlenecks. Shares fell 3.9% during the early trading session in New York. 

(Updates with shares in sixth paragraph. An earlier version of this story was corrected to amend Bonfield’s title in second paragraph.)

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