Boom times for Tractor SalesPosted by Mim Monkivitch, 11th October 2020
2020, the year of the worst shock to the world’s economy since the great depression looks like be a record for tractor sales in Australia. Sales in the month of September were up 29% on the same month last year and are now up 22% year to date. The ongoing demand for agricultural produce combined with favourable weather conditions across the nation, supported by the Federal Governments Instant Asset Write Off program are supporting record sales volumes. Previous record years have seen tractor sales of 12,000 achieved, this year looks like going past the 13,000 mark for the first time since the 1980’s
Activity across the states remains extremely positive with the continued recovery in NSW the standout up a whopping 41% on the same time last year and now sitting 30% ahead for the year.
Victoria reported another strong month, up 27% and now 22% ahead year to date meanwhile Queensland was up 22% to be 14% up for the year. Western Australia sales were down due to some negative weather events and remains 4% behind last year. Sales in South Australia are back on track with another strong month after a poor 2019 now 60% up YTD, activity in Tasmania remains strong, now 25% ahead for the year.
The increase in sales numbers is again due almost entirely to the ongoing strength in the smaller end of the market supported by the Instant Asset Write off scheme. The under 40hp (30kw) range was up 71% for the month and now sits 29% ahead for the year to date.
The 40 to 100hp (30-75kw) range was again up strongly 27% now 22% ahead for the year.
The 100 to 200hp (75-150kw) category bounced, up 26% and still up 31% for the YTD whilst sales in the large 200 hp (150kw) PLUS range where again down another 23% leaving this category 9% behind YTD. Demand for large tractors is being impacted by a range of factors including the persistent drought in regions within Northern NSW and Southern Queensland and the ongoing challenges being felt in the West. Further pressure is being felt as a result of recent price increases.
With regards to other products, sales of Combine Harvesters remain steady with most product now in place for the upcoming harvest season. The full year picture is likely to be around 15%-20% down on last year.
Baler sales were again very strong, remaining up 38% year to date whilst sales of Out Front Mowers were strong and still 15% ahead of the same time last year.
The outlook for the industry remains extremely positive, particularly in light of the recent budget announcements still to be approved in parliament. Initiatives such as the extension of the Instant Asset write off program, incentives for apprenticeships and increased investment in R&D go a long way to building confidence in the industry.
The current La Nina weather pattern being experienced across much of Australia, combined with historically low interest rates, augers well for the year ahead.
The results for the TMA Quarterly Dealer Business Sentiment Survey are now in and not surprisingly, the outlook expressed by dealers is quite positive. The full report can be found on the TMA website – www.tma.asn.au