By Michelle van der Spuy
The sale of tractor and combine harvesters improved for the fourth month in the row during April, says the South African Agricultural Machinery Association (SAAMA).
A total of 527 tractors sold during April, 5% more than the 500 units sold in April last year. Year-to-date tractor sales are now almost 22% higher compared to the same period last year.
A total of 46 combine harvesters were sold last month, 20 more than the 26 units sold in April last year. On a year-to-date basis, combine harvester sales are now approximately 37% higher compared to the same period last year.
According to Saama’s current predictions, this year’s tractor sales will be similar, or marginally more, than the 6 463 units sold last year. Combine harvester sales are also expected to be higher than the 201 machines sold last year.
Willie Human, Saama’s chairperson, says late rains caused problems with the harvesting of most summer crops.
“This will delay the whole season, going into soil preparation for the forthcoming summer crops. Sales of agricultural machinery are therefore likely to be delayed because of this.
“However, market sentiment is still positive, with farmers waiting to see what the yields and quality of their harvests are going to be once they have harvested their crops. Commodity prices are still holding up in most cases.”
According to the crop estimate committee summer grain and oilseeds production for the 2024-’25 season is expected to reach roughly 18 million tonnes, 16% higher than the 2023-’24 season.
Wandile Sihlobo, chief economist at Agbiz, says though the heavy rains in April have caused concerns about the current season’s crop quality, optimism about the yields supports this year’s robust sales.
“If we reflect briefly on the past few years’ performance, it is fair to say that the poor agricultural machinery sales performance in 2024 resulted from three major factors.
“First, South Africa’s agricultural sector had higher machinery sales between 2020 and 2023. Improved farmers’ incomes supported higher sales due to an ample harvest and higher commodity prices. Thus, there was bound to be some correction, leading to a moderation in sales in 2024.
“Second, we struggled with a mid-summer drought in the 2023-24 season, weighing on farmers’ fortunes and worsening sales performance. Lastly, the relatively higher interest rates for much of 2024 added to the economic pressures on the sector, leading to poor sales.
This year, however, things are different, as the sales for the first quarter have already shown.
“The interest rates have eased somewhat from last year’s levels, although there remains uncertainty about the path ahead given the renewed risks to the global economy. Moreover, agricultural production conditions are favourable across most commodities.
“Also worth noting is that some farmers may start with machinery replacement in the coming months. All this will support the sales of tractors and combine harvesters in 2025.”
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