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September 8, 2022

Tractor sales begin financial year strongly

Sales of Agricultural tractors in August were again strong up by 22% on the same month last year and are now 2.5% up on the 2022 year to date. This is a particularly strong result given the rush of buyers that occurred in June, keen to maximise use of the Federal Government’s Temporary Full Expensing Program.

As we have been reporting for some months now, the industry’s ability to deliver tractors in such large quantities is due to the regular forward ordering that has been occurring for 2 years now in anticipation of supply challenges. The fact remains that if a farmer wants a specific “bespoke” tractor ordered from the factory then delivery will be at least 12 months, indeed most dealers now are resisting taking forward orders because of the uncertainty surrounding supply combined with the price movements that are beginning to occur across the board.

The big question being asked at present is when this incredible upswing will come to an end. With Tractor Sales running at around 50% ahead of what has traditionally been seen as a great year, there is no doubt that this can’t continue. Delays in supply have served to smooth out the peaks in the market but we are beginning to see signs of when the current boom might end. Ownership costs are rising steadily with both purchase prices and financing costs rising steadily and the current tax incentives are in their final year. The challenge for dealers will be to get the timing right regarding inventory given the prospect of machines ordered 12 – 18 months earlier, might arrive at a period of weakened demand.

Looking at sales across the nation, results were strong across the board with NSW sales up 8% to be now 1% behind last year. Queensland was up 46% to be now 13% ahead year to date and Victoria was 24% up on last August due mainly to supply of small hp units and is now up 3% on last year.

Sales in Western Australia recorded another huge lift with the further arrival of large hp machines, up 30% for the month and are now ahead 2% YTD, South Australia were up 13% for the month. Tasmania was down by 23% whilst sales into the Northern Territory were up 89%.

Looking at the performance reporting categories, the small under 40 hp (30kw) category was strongly up 25% to be 10% ahead YTD. The 40 to 100hp (30-75kw) range was up 21% in the month to remain 4% ahead YTD and the 100 to 200hp (75-150 kw) category was up again, 7% ahead in August to be 4% behind YTD.

The large 200 hp (150kw) PLUS range was the standout again this month, 55% ahead of the same month last year but still 1% off YTD.

Combine Harvester sales are ramping up in preparation for this year’s harvest and are now 19% ahead of the same time last year. There is every expectation of another 1,000+ year for this product as the renewal of fleets occurs in anticipation of another bumper harvest.

Baler sales have slowed through winter and are now down 19% compared with last year and sales of Out – Front Mowers finished down again by 3%.