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2013 Results

Posted by Admin, 17th February 2014

With final figures now in, the Tractor & Machinery Association reports that 2013 produced what is best described as an “average result” for farm machinery sales.

Tractor sales were down 7.5% overall from 11,418 units in 2012 to 10,561 last year but the 100 – 200 hp sector which holds 18% of the market rose by 6%.

TMA Executive Director Richard Lewis feels that this was due to the uptick in dairy fortunes and improving hay and fodder markets during the latter half of the year.

“The aggregate decline in numbers caught most dealers and importers by surprise but it’s important to note that this was still the fifth year in a row of more than 10,000 units,” he said.

“It’s looking like the new average. There’s still solid underlying demand. The up to 40 hp sector accounts for around 30% of the total market and it was only down 5%.

“This is the lifestyle market largely driven by off farm income it’s difficult to forecast. It bears little correlation to general agricultural indicators.

“At the upper end the 200 hp plus market increased 1% to 2241 units. This was quite significant for importers and dealers because while this sector only holds 12% of the total market in units, it represents a much larger proportion of the dollars.”

Mr Lewis said he doubted the 10,000 benchmark would be achieved in 2014 but numbers would be very close.

“We’re forecasting a 5 to 7% reduction this calendar year because dealers have a lot of trade-ins on hand that they need to move. Attractive pricing on second hand units is likely to replace some new sales.”

Combine harvester numbers fell 30% to 702 units down from 1012 the previous year. Mr Lewis said that although reduced sales had been predicted, the final result was slightly below expectations.

“We’d seen bumper sales of over 1000 units the previous two years. We knew it had to come down from there. I don’t think we’ll see much more than 650 sold this year. There will be a lot of used harvesters on the market.”

Alan Kirsten of industry analyst Agriview expects combine harvester sales will settle around the 600- 800 mark for the next five years.

“The re-equipping cycle for harvesters is quite long. The last time we had two years of 1000 plus sales was 14 years ago,” he said.

Balers finally turned the corner in 2013 after five years in the doldrums with sales up 11% to 621.

“It’s been a long time between drinks for manufacturers and dealers and they were starting to worry if it would ever turnaround,” Mr Lewis said.

“We hear that most dealers were also able to clear out their inventory of used balers and hay tools.

“Rounds were up 4% to 433 but the big improver was large squares with a massive 68% jump from 78 units up to 131. Small squares were down 12% but they only account for a minor part of the market.

Mr Lewis said there was plenty of new and used inventory on the ground both in dealer yards and with manufacturers and importers. This offered a mixed outlook for dealers and farmers.

“Dealers will have to be very careful with what they are prepared to offer on trade-ins, that’s if they are prepared to trade at all. They have a lot of used stock to move and this will likely drive down the values of used machinery in the short term.

“That’s good news for farmers if they are trying to buy used equipment, but not so good if they are selling. Farmers might also see some good deals on new gear that came into the country while the dollar was higher, especially if they don’t have a trade.

“We don’t specifically measure tillage and sprayer sales but there’s no doubt that both have shown a vast improvement this last year. Tillage sales should continue to improve in 2014 but sprayer sales will drop – the market is again oversupplied with used equipment at the dealer level,” Mr Lewis said.

Mr Kirsten said tractor sales had declined in all states although the scale varied considerably.

“Queensland was only down 2.5% compared with 14% in Tasmania, although that was off a smaller base. New South Wales showed the next biggest fall with a 10% reduction. The other states all ranged around the 6 – 8% mark.


Further information: Richard Lewis 0421 847 872