First Half Tractor Sales Take a Dip

The new tractor market was down almost ten per cent in the first half of 2016, but used business has picked up slightly.

The new tractor market was down almost ten per cent in the first half of 2016, but used business has picked up slightly.

 

With road registrations of new agricultural tractors for the month of June now having been confirmed at 1,007 units, the total UK market for the first six months of 2016 stands at 5,382 tractors, according to data collated by the Agricultural Engineers Association.

Measured to include only those tractors rated at 50hp-plus, to differentiate agricultural models from those under 50hp (37kW), where the market is predominantly for machines used in horticulture and groundscare, tractor registrations are seen widely as a barometer of the farming industry as a whole. The 2016 first-half total represents a decrease of 9.8% compared with the first six months of 2015, with the June figure meaning that the first half total is 5,382, down from 5,970 units sold during the same six-month period during 2015.

As a guide to the potential total market for the year, the June numbers take the moving 12-month total to the end of June to 10,254 units. The figures show a continuation of the steady decline the market has been subject to since November 2014, when the last year-on-year monthly increase was recorded.

With the combinable and root crop sectors and the dairy industry – the main users of 50hp-plus tractors – all feeling the pressure of the current sustained bout of low commodity prices, the figures are not unexpected. But some manufacturers and importers at the recent Cereals event held near Cambridge reported that, while the quantity of enquires was low, the quality was high, suggesting that there remains a core of businesses with the wherewithal to keep their replacement and investment plans on track despite the downturn.

The continued steady decline in the number of manufacturers present at the event was notable, though, and among the big names to stay away and conserve their marketing money were McCormick and Landini importer AgriArgo, JCB’s tractor and materials handling Landpower division, and tractor and harvesting specialist Claas. With prospects for the 2016 combinable crop harvest looking good but not outstanding, and world markets continuing to be well supplied with a surplus of wheat, significant upturn in the farm equipment sector does not look likely for some time to come.

The machinery trade has been buoyed slightly by a small revival in the used tractor and equipment market in recent months, as currency movements have brought overseas buyers back to the market and domestic farmers and machinery traders have sought equipment to cover their requirements ahead of the 2016 harvest. With that now underway, it remains to be seen how quality and yield may impact upon prices – and consequently on farm machinery investment this autumn. Harvest across much of mainland Europe and the CIS states has been delayed by the difficult spring/early summer weather suffered across much of the continent, and the effect of this on tonnages and on the suitability of cereals for milling and malting could be the pivot point around which prices rotate. The effect of all this on both the new and the used machinery markets is one the equipment industry is awaiting with interest.

Charles Spencer

About Charles Spencer

Community Manager at Agriaffaires! You will find here all the latest agriculture and farm equipment news!