The 11,9% drop in year-on-year national tractor sales between February 2017 and February 2018 has been described as “quite disappointing” by the South African Agricultural Machinery Association (SAAMA).

The association reported that 595 tractors were sold countrywide last month compared to the 675 units sold during February 2017.

In comparison, SAAMA reported that SA’s January 2018 tractor sales were up 10,3% compared to January last year, and that this had been “encouraging”.

The association’s chairperson, Lucas Groenewald, said that sentiment in SA’s tractor market was being affected by a variety of factors.

“The summer crops currently in the lands are patchy in terms of their yield potential and time of planting, both caused by the patchy rainfall pattern across these areas. Crop prices remain low and a lot of last year’s crops are currently being stored, with many farmers holding out for higher crop prices. This is having an effect on their cash flow and their ability to finance the purchase of capital equipment,” Groenewald said.

“The short-term trend in agricultural machinery sales is very difficult to predict. However, industry forecasts for the 2018 calendar year are that tractor sales should be at least at similar levels to 2017 sales of 6 362 units.”

He also said that the rand that was currently stronger against major trading currencies, so tractor prices were likely to come down in the foreseeable future. Many farmers were delaying their buying decisions to take advantage of this.

In his analysis of SAAMA’s February 2018 agricultural machinery sales statistics, Wandile Sihlobo, Agbiz’s head of agribusiness intelligence, said that after a “disappointing performance” in December 2017 and January 2018, national combine harvester sales recovered in February 2018 to 21 units sold.

This was 16,7% up on the 18 combine harvesters sold in February 2017.

“This was partly supported by both the fairly strong domestic currency as well as expectations of a good summer grain and oilseed harvest of 14,6 million tons. This is down by 25% from the previous season, but better than market expectations at the start of the year,” Sihlobo said.

Agribusiness Information

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