No concerns over drop in national tractor sales

South Africa’s agricultural machinery manufacturers and marketers are not too concerned about the decreases in monthly tractors sales so far this year.

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Forecasts were that total new tractor sales for the 2013 calendar year would still be well above the historical norm of 4 500 to 5 000 units. The SA Agricultural Machinery Association reported that in March 2013 tractor sales of 595 units, were down 7,8% on the 645 units sold in March 2012. Year-to-date March 2013 tractor sales of 2 106 units were 5,8% down on the 2 235 units sold during the same period last year.

“Current industry predictions are that tractor sales in the 2013 calendar year will be of the order of 6 700 to 7 100 units, between 10% and 15% down on 2012 sales,” said SAAMA’s Chairperson, Callie Human. “Tractor sales so far this year reflect this trend.” SAAMA attributed this recent decline to some of SA’s summer grain cropping areas having suffered drought damage, resulting in national 2012/2013 summer grain crop production estimates being cut by approximately 15%.

The association added that, in light of this some potential tractor buyers were holding back on their purchases until their crops had been harvested and they had accurate figures of their yields. With the 2012/2013 summer grain harvesting season in full swing, combine harvester purchases have been strong. SAAMA reported that 72 new units were bought in March 2013, 213% more than the 23 units bought during March 2012. For the year-to-date March 2013, 136 combine harvesters had been sold. This was 142,9% more than the 56 units sold during the same period last year.

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SAAMA’s Secretary, Dr Jim Rankin, said that there were no concerns in the agricultural machinery sales industry at the moment due to the decline in tractor sales. He said that despite the lowered summer grain crops estimates, fundamentals affecting agricultural machinery purchases remained positive overall.

“Predictions for total 2013 tractor sales are still significantly higher than the historic average. The market will be buoyed in the short-term by farmers purchasing lower-priced equipment ahead of price increases caused by the recent devaluation of the rand,” Rankin, said.