Surge in tractor sales continues unabated

Tractor sales for the first 10 months of the year rose by 45,7% compared to the same period last year.

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Tractor sales for the first 10 months of the year rose by 45,7% compared to the same period last year. October saw the highest sales in one month for 28 years – since October 1982, according to the South African Agricultural Machinery Association (SAAMA).

A total of 979 tractors (October 2010: 610) and 45 combine harvesters (10) were sold in October. Since the beginning of the year, 6 286 tractors and 239 combine harvesters were sold respectively, compared to the 4 315 and 166 units last year.

“Agricultural tractor sales comes from a low base,” said Lane Reynolds, chairperson of SAAMA. “Commodity prices were low for a couple of years and farmers didn’t buy new tractors.”

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Edwin Galt, sales manager at TWK Landbou in Piet Retief, agreed that sales are up. “We definitely had a marked rise in tractor sales since September 2010. We used to sell a tractor here and there and now we have strong monthly sales.”

The surge in tractor sales is attributed to the need to replace old equipment, higher commodity prices, and the flow-through effect of the strong rand last year, according to Reynolds. “People know that prices are not going to stay at these low levels,” he said.

He said, however, that “the bargains are over” with reference to the impact of a weaker rand/US dollar value and an uptick in the global demand for tractors. “There’s going to be a sharp increase in tractor prices from now on.”

The higher prices will be compounded by the lack of tractors in stock. “There is no stock,” said Frans Kamfer, a New Holland marketer for Suidwes Landbou in Vryburg, Schweizer-Reneke, and Hartswater. “The tractors we ordered are sold.” – Jaco Visser