The Tractor and Machinery Association (TAMA) says the impact on sales in response to the coronavirus pandemic is still unknown.
TAMA president John Tulloch says 2020 is shaping up to be a year of uncertainty and “only time will tell”.
Covid-19 could impact sourcing components from China although this had not yet occurred, he says.
“We just don’t know the actual impact yet. It could end up being positive as New Zealand is known as a safe country for food production. We have stringent and well-recognised food safety systems so could be seen as a preferred supplier,” Tulloch says.
TAMA statistics showed overall machinery sales were down in 2019 with 4382 units compared to 4531 of all types sold in 2018.
Tulloch says as these units included everything from $1000 sprayers through $500,000 harvesters, it was more useful for meaningful comparisons to focus on the key machinery areas of grass and forage harvesting.
These sales were down around 6.8% with 1665 units sold in 2019 compared to 1787 units the year prior.
Meanwhile, there were 4007 tractor sales in 2019 compared to 4640 in 2018, a drop of 13.6%.
“Anything over 4000 tractor units is still a respectable result and showed we had a pretty solid year. And certainly within the machinery sector, we had a better year than many were expecting considering the conditions,” Tulloch says.
These conditions included uncertainties around government policy on water quality and emissions plus challenges in obtaining finance as banks beefed up their equity reserves.
Tulloch says the North Island drought conditions would have an effect on farmers although contractors might have a good season as feed reserves have been used up, requiring restocking.
Farmers in Westland, Southland and Otago were also suffering after a wet, cold spring followed by summer flooding.
“The reduction in value of dairy company shares is also suppressing the mood and sentiment of dairy farmers even though the predicted payout of $7 plus is still quite positive.
“I would like to think that this coming season might give us a slight increase because some farmers and contractors have deferred purchasing so there’s some pent-up demand to realise.
“Many are saying ‘let’s wait and see’ but by the time they decide it could be too late to purchase in 2020.
“Factory lead times are becoming longer as the machinery becomes more complex and technical.
“People need to order much earlier now to ensure their order can be imported in time so it’s important they make the buying decision sooner not later,” Tulloch says.
