Tractor sales pick up in May

Tractor sales in SA rose to the highest level this year in May despite challenges such as the midsummer drought, which resulted in a 19% drop in the expected harvest of summer grains and oilseeds.

However, the 566 units sold is still down from the 655 recorded in the same month a year earlier, according to the the SA Agricultural Machinery Association (SAAMA). Year-to-date tractor sales are down almost 22% compared with the same period in 2023.

In addition, 25 combine harvesters were sold in May, which is 40 units less than the 65 sold in the same month in 2023. Year-to-date combine harvester sales are almost 61% lower than a year earlier.

Speaking at the annual Nampo Harvest Day agricultural exhibition in Bothaville last week, Wandile Sihlobo, the chief economist of the Agricultural Business Chamber of SA (Agbiz), said the monthly uptick did not change the overall decline recorded since the beginning of 2024.

“We believe this persistent annual decline in sales since the start of the year reflects the normalisation of sales after a few years of robust activity,” he said.

Sihlobo noted that tractor sales for 2022 amounted to 9,181 units, a 17% increase year on year, and the highest annual sales figure in the past 40 years. Combine harvesters also had an excellent performance, with 373 units sold in 2022. That was 38% higher than the year before and the highest figure since 1985.

“In 2023, the tractor sales were down marginally from the previous year, while the combine harvester sales held last year’s momentum. These past few years, the generally strong agricultural machinery sales were primarily supported by ample grains and oilseed harvests when prices were also favourable,” he said.

Sihlobo said high interest rates had added strain to farmers’ budgets. Though various input costs such as fertiliser and agrochemicals had eased since 2023, prices generally remain well above pre-Covid levels, which increased their financial burden.

Tallie Giessing, SAAMA’s vice-chair, said the mood among farmers attending the exhibition “was generally positive, though cautious”.

“This caution expressed itself as uncertainties in terms of the then forthcoming elections, weather prospects and crop harvest expectations. These uncertainties still prevail, to a lesser or greater extent,” he said. 

Meanwhile, the crop estimates committee forecasts SA’s 2023/24 total summer grains and oilseed production at
15.9-million tonnes, down 0.5% from the previous month’s forecast and 21% lower than the previous season’s harvest.

“A closer look at the data shows the white and yellow maize harvest could be 6.4-million tonnes (down 0.9% month on month) and 6.9-million tonnes (down 0.3% month on month). These revisions place the total maize production estimate at 13.3-million tonnes (down 0.6% month on month),” Sihlobo said.

“When viewed annually, the white maize harvest is down 25%, with yellow maize down 13% from the 2022/23 season,” he said.

The expected harvest of 13.3-million tonnes was 19% lower than the 2022/23 season, though Agbiz wasuncertain about the quality of the crop, he said.

“Suppose we are correct, this harvest would meet SA’s annual maize consumption of roughly 12-million tonnes, leaving the country with over 1-million tonnes for exports,” he said.

majavun@businesslive.co.za