Tractor dealers report price rises as supply issues remain

According to the Tractor and Machinery of Association of Australia’s (TMA) latest monthly report, sales of agricultural tractors remain steady in April, with numbers down three per cent on the same month last year and now sitting 11 per cent behind for the 2022 year to date.

Despite the dip, the TMA said it was still a strong result as demand remains high, however the main challenge is still supply.

RELATED: Tractor sales slow amid supply challenges

TMA’s executive director, Gary Northover, said the inevitable price increases are starting to occur.

“Exacerbating the challenges associated with getting machines, most members are now reporting solid price increases being passed on by their factories after a number of years of largely absorbing these movements,” he said.

“Of particular note is the supply of steel with Ukraine reportedly responsible for a large share of the world's production being severely impacted leading to price increases across the board."

Northover said demand for agricultural machines is currently very strong worldwide and in Australia, and with the Temporary Full Expensing Program set to run until June 2023, buying activity will remain strong.

“Indeed a recent survey of dealers has found that the majority expect turnover to remain unchanged for the outlook period,” he said.

Breaking the numbers down by state, tractor sales in NSW dropped further by 21 per cent for the month and are now 13 per cent behind last year. Queensland numbers were up by 12 per cent as deliveries delayed in March due to inclement weather finally took place and the state now sits one per cent behind year-to-date. Victoria was 19 per cent up on last April due mainly to supply of small horsepowered units and is 4.2 per cent down YTD.

Sales in Western Australia recorded another drop, this time by five per cent YOY to be 27 per cent behind YTD. South Australia also dropped eight per cent YOY while Tasmania recorded a 15 per cent drop. Finally, sales into the Northern Territory were down 21 per cent YOY.

Across the horsepower categories, sales of the smaller units are picking up pace with the under 40hp category up 20 per cent YOY to sit two per cent behind YTD. The 40 to 100hp range was up three per cent in the month to remain two per cent ahead YTD, while the 100 to 200hp category was down 18 per cent.

Sales in the larger 200hp and over range once again dropped, this time by 15 per cent compared to the same month last year and is now 33 per cent off YTD.

“The big end of the range is experiencing the worst of the supply chain delays as members report lengthy lead times out of the factories due to everything from steel supply to the ongoing shortage of computer chips,” Northover explained.

Combine harvester sales are yet to commence for the year, however, dealers are already reporting healthy pre-order interest for machines which should lead to another strong year of sales, the TMA said.

Baler sales were down in April and are now 20 per cent behind YTD, and sales of out-front mowers were down a whopping 44 per cent.