Machinery sales maintain momentum

Tractor and combine harvester dealers in South Africa received a welcome Christmas bonus this past December, with sales exceeding all expectations.
Issue date : 30 January 2009

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Tractor and combine harvester dealers in South Africa received a welcome Christmas bonus this past December, with sales exceeding all expectations.

Tractor and combine harvester dealers in South Africa received a welcome Christmas bonus this past December, with sales exceeding all expectations.
According to the SA Agricultural Machinery Association (SAAMA), farmers bought 438 tractors in December 2008, a 67,8% increase on the 261 tractors sold in December 2007. Farmers also snapped up 12 combine harvesters, a 300% increase on the three combine harvesters sold in December of the previous year.

“Several industry commentators were surprised at the high number of tractor sales in December, the highest December sales since 1988. Traditionally, it’s the lowest sales month,” said a SAAMA statement. The association secretary, Dr Jim Rankin, told Farmer’s Weekly he believed that a combination of factors had led to local farmers investing in new machinery this past year.

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“Their good summer season of 2007/08 resulted in many grain farmers having money in their pockets that they could use for upgrading their farming enterprises during 2008. When the rand weakened in March and October last year, farmers probably decided to buy machinery before the impact of the weaker rand filtered down to machinery prices. All of the tractors and combine harvesters are imported, so it was in the farmers’ best interests to invest in this machinery at the lower prices while they still could,” Dr Rankin explained.

He added that the latest tractor and combine harvester technology improved production efficiencies such as diesel consumption and farmers value these benefits for reducing input costs.While the Crop Estimates Committee has yet to release its estimates for the current summer grain crops, Dr Rankin said that he would be surprised if one of the major motivators for the increased tractor and combine harvester sales was the larger grain crop plantings this season.

“Input costs were very high and rainfall patterns not favourable during the planting season of the current grain crops, so I can’t imagine that plantings would be more extensive than during the 2007/08 season. I think that the increased machinery purchases were primarily motivated by sound financial planning on the part of farmers in the light of economic forecasts,” he said. – Lloyd Phillips