Good farming conditions have boosted farm incomes to such an extent that tractor sales are expected to reach record highs this year, in spite of the dramatic fall in milk prices.
BusinessDesk reports that sales of tractors of at least 40 horsepower – the most common measure for fame tractors – have reached 2536 units in the first nine months of this year, and are expected to reach the same number sold in 2005 of 3515, which will be the highest number since the Tractor and Machinery Association (TAMA) began gathering the data in 1990.
It is estimated that 60% of farm tractor sales nationally are related to the dairy industry.
TAMA president Ian Massicks told BusinessDesk the dairy payout of $8.40 per kilogram of milk solids and the good growing conditions negating the need for buying extra stock feed, meant that farmers had more cash this year to buy farming equipment such as tractors.
TAMA expects that the lower forecast payout of $5.30 per kilogram of milk solids to dairy farmers may only reduce 2015 tractor sales by around 15% from this year’s highs.
“Even at that level, it is still a reasonable payout,” says Massicks. “There is no doubting this year’s has been an exceptional payout. It’s still going to be a very healthy tractor market next year.”
