Unprecedented year for tractor market

It has been a calculated assumption for a while but recent data from the Tractor and Machinery Association of Australia (TMA) has all but confirmed that 2020 was a record-breaking year for local tractor sales, with the final number sitting well above the 13,000-unit mark.

That was a number last seen in the 1980s. Sales in December 2020 was 27 per cent up on the same time in 2019.

“Much has been said about the level of optimism in the agricultural sector with a great harvest now largely completed supported by the Instant Asset Write Off Scheme which has now been extended to June 2022,” said TMA executive director, Gary Northover.

“Concerns surrounding supply from overseas sources are generally being dealt with as dealers work to deliver on customer’s requirements. The year has seen a continuation of recent trends as demand for bigger horsepower machines increased along with demand for low emissions engines.”

He added the used equipment market has also been strong thanks to the IAWO incentive and finance rates continually being set at very attractive levels.

All states recorded strong results in December with NSW again the standout, up 66 per cent on the same time last year and now sitting 40 per cent ahead for the year. Victoria reported a solid lift up 17 per cent in the month and finished 22 per cent ahead year-to-date, while Queensland was up 31 per cent to sit 18 per cent ahead for the year.

Western Australia sales picked up seven per cent in December and is now in line with last year, while sales in South Australia held steady to end the year 27 per cent up YTD. Finally, Tasmania finished the year 27 per cent ahead.

The strength in sales numbers again sits almost entirely in the smaller end of the market supported by the Instant Asset Write off scheme. The under-40hp range was up 72 per cent for the month and ended 36 per cent ahead YTD.  The 40 to 100hp range recorded a 16 per cent increase YOY and sat 27 per cent ahead for the year.

The 100 to 200hp category also had a healthy increase of 28 per cent YOY to sit 26 per cent ahead YTD; while the 200hp plus range dipped again leaving this category eight per cent behind for 2020.

“The much talked about supply challenges have been felt across all size categories and for the first time in a long while, dealers have been forced to move stock around amongst themselves to satisfy orders,” Northover said.

“Pleasingly, most dealerships are now returning to full staffing levels which will assist in meeting the challenges ahead.”

It wasn’t just tractors going through a boom, with previously struggling machinery categories also experiencing strong growth.

Sales of combine harvesters experienced a late year flourish – up 25 per cent YTD thanks to one of the best harvests in recent memory.

Baler sales continued their boom run to sit 35 per cent ahead year to date, while sales of out - front mowers are also flying, now 40 per cent ahead up YTD.

“As we look forward to 2021, most suppliers are predicting a continuation of the strong levels of demand underpinned by both the ongoing favourable weather conditions and the Instant Asset Write Off Scheme,” Northover said.

“We do however expect to see some unevenness in supply as the main manufacturing centres in North America and Europe continue to struggle with the impacts of the Coronavirus.

“This may lead to some ‘lumpiness’ in sales reporting however, we expect next year to be another strong one.”