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July 9, 2018

Record Year for Tractors as Sales held back in June

The Financial Year just ended has been another record one for Tractor Sales with sales just shy of the 13,000 unit mark, despite a noticeable drop off in June as dealers slowed up deliveries.

Tractor sales in Australia have now surpassed the $1 billion mark for each the past 10 years, Overall Tractor Sales now sit 4% ahead on a year to date basis.

Whilst we continue to associate tractor sales with Agricultural use, the influence of the lifestyle of hobby farmer has been significant in delivering an almost new category of customers to the market. This segment has a very healthy appetite for new tractors and are operating with a level of sophistication which is demanding attention and now accounts for around one third of the total industry by number.

In addition to this influential segment, the size of tractors purchased, based on horsepower, has been steadily increasing. In 2013 the average tractor size was 32 horsepower and it is now 36 horsepower. The good news for buyers though is that whilst size has been increasing, prices have in fact been declining due to improved manufacturing techniques and the very low interest rate environment

Around the country, we have seen a mixed bag due in no large part to the drought conditions being felt along the eastern states.

Sales in Victoria were 2 % down on last year with June numbers behind 11%.

It was a similar tale in NSW and Qld, both in line with last year but down around 20% on the same month.

WA continues to be a bright spot where rains have fallen exactly where and when they were required, up 9% on last year following a strong June.

SA was again strong, up 12% for the year and Tasmania has had a great year, 20% up on last year.

All 4 reported size categories delivered a negative result in June, the under 40HP segment finished 4 % behind for the year after a very quiet June.

Sales in the mid categories, 40-100HP (up 2%) and 100-200HP (up 11%) had healthy years, whilst the over 200HP group was down around 9% this year after a very strong 2016/17.

Combine Harvester Sales are still in the “dormant” phase with planned deliveries not likely to occur for another few months. That said, expectations are for a much lower year as the impact of the drought takes hold. On a year to date basis, sales are presently tracking last years levels with 108 units sold since January.

Baler Sales are sitting in line with last year also at around 100 units since January and finally, sales of out front mowers have turned down, around 10% below last year.

All in all, we are beginning to see real signs of, if not a slowdown, then certainly a pause in activity particularly as a result of the dry conditions. The coming months will certainly tell a tale in this regard.