Machinery Market: Tractor sales down 16 per cent in January

After an end-of-year rush, tractor sales have struggled in January to be 16 per cent down on the same month last year, writes Gary Northover.

Sales hotspot: Tractors in the 100hp to 200hp category were the best-selling machines in January, up 2.6 per cent.

FOLLOWING on from December’s end-of-year rush, when we saw a 7.5 per cent rise, tractor sales have been well down for January to be 16 per cent lower than the same month last year.

Dealers have generally reported that the extreme weather events, with the prolonged bushfire season, have considerably affected what demand there was in the market.

It’s early days yet, but the heavens have opened and at the time of writing, the bushfires have all but been extinguished and a fair degree of optimism has returned to agriculture.

There is some hope for farmers planting late summer crops particularly given the solid commodity prices still being achieved.

The story in January, however, was nothing short of dismal in NSW, down 33 per cent on a year earlier and Queensland, down 27 per cent.

South Australia was not much better, down 19 per cent for the month while Victoria was the one bright spot, up 2.5 per cent for the month. Western Australia was in line with last year.

January sales were strongest in the 100hp to 200hp (75-150kw) category, up 2.6 per cent. The 200hp (150kw) and above range was down 13 per cent for the month, the 40hp to 100hp (30-75kw) range was also down 20 per cent and the under-40hp (30kw) range again struggled, down 31 per cent.

Despite the positive outlook provided by the current rain, we still expect tractor sales to be down this year with early predictions putting the total at about 10,000 units.

The impact of the drought is likely to be felt for some time yet and 2020 is unlikely to be the year of full recovery.

That said, very low interest rates combined with strong inventory levels means that buying opportunities for farmers should remain strong throughout.

Conditions for combine harvester sales continue to be challenging, with only a small number of sales in January. Importantly, it is generally about now that forward orders are placed for deliveries later in the year, and the outlook for these is mixed across the nation.

Hay baler sales have taken a bit of a breather in January, down 29 per cent on last year’s bumper result, however, the prevailing view is that demand will still be very strong and anything that can be cut will be cut, so we are expecting another strong year for baler sales.

Out-front mower sales were down 50 per cent on the previous January.

The date for the 2020 TMA Conference has been set for July 21 to be held once again at the Hyatt Place Melbourne, Essendon Fields.

This year’s event will be themed “Towards 2030” and will be focused on the challenges expected in areas such as autonomy, sales and marketing effectiveness and many more as we launch into a new decade.

• Gary Northover is Tractor & Machinery Association of Australia executive director