SA agricultural machinery industry ‘to fight for its future’

This, with ongoing drought across most of the country and the recent fall of the rand to record lows against major trading currencies, has reportedly placed a heavy burden on South Africa’s agricultural machinery supply sector.

The South African Agricultural Machinery Association (SAAMA) reported that December 2015 new tractor sales of 246 units were 28,5% down on the 344 units sold in December 2014. Year- to-date December 2015 new tractor sales were 5 673 units compared with the 6 460 units sold in the previous year.

Five new combine harvesters were sold in December 2015, which was 37,5% lower than the eight units sold in December 2014. SAAMA reported that 211 new combine harvesters were sold nationally over the 2015 calendar year in comparison with the 333 units sold in the preceding calendar year.

“The situation has worsened again since last month as the drought and heat wave conditions have prevailed,” said SAAMA chairperson Wynn Dedwith.

The serious weather problems that South Africa was currently experiencing, as well as the recent sharp fall in the rand’s value would lead to significant increases in both agricultural machinery and summer crop prices, Dedwith said.

“This is going to have a serious knock-on effect for the larger South African economy. The agriculture and agricultural machinery industries, in particular, are going to face a difficult future in 2016 and will be fighting for their very existence in forthcoming months,” he said.

Dedwith added that while the country had anticipated a severe shortfall of locally grown maize due to the drought, and which non-official estimates anticipated would require five million tons of maize imports to remedy, this situation would become clearer only towards the end of January when the Crop Estimates Committee released its preliminary estimates of crop
plantings for the 2015/2016 summer.