Wednesday, 05 June 2019 16:59

Machinery sales steady, challenges loom

Written by 
John Tulloch. John Tulloch.

Sales of tractors and farm machinery so far in 2019 are steady versus 2018 but challenges loom, says Tractor and Machinery Association (TAMA) president John Tulloch.

TAMA’s year to date figures to April 30 show 1104 sales across all sectors vs 1111 in 2018. 

North Island sales fell by 4.7% to 713 (2018 - 748). South Island sales rose by 7.4% to 390 units delivered (2018 - 363). 

April 2019 sales figures are down 11.7% on April 2018, says Tulloch. This is partly due to 10% fewer sales of smaller (20 - 50hp) machines typically used by small commercial operators and lifestyle block owners. 

While 2018 was a record sales year (4600 units sold) Tulloch predicts 2019 sales will fall to between 4300 and 4500 units,  mainly due to the decline in the smaller model sales which last year totalled nearly 1000 units. 

Overall confidence in the rural sector remains strong, prompting farmers to keep buying tractors and machinery, Tulloch says. But he forsees a tightening of credit conditions, likely because of signals by the Reserve Bank on increasing banks’ equity to loan ratios to help increase its cash reserves. 

“This will have the potential to affect the indebted rural sector, particularly dairy farmers who typically carry greater debt.” 

Tulloch also warns of a forthcoming increase in global shipping rates – due to new emissions regulations – that will take effect by January 2020. These will require most ships to reduce sulphur emissions under the Marpol Annex VI treaty. 

While New Zealand has not ratified this treaty, most visiting vessels are registered in countries that have ratified it and will be bound by the new rules. This will force ships now powered by crude oil to switch to more expensive diesel, pushing up importers’ costs and those of customers.

“There is also the impact of minimum wage rate upgrades, meaning that as the lower end of pay scales increase, then other grades would also need to be reviewed,” Tulloch says. 

He says service technicians four or five years ago typically earned $28/hour but their rates now exceed $35/h.

“Yet despite these increases there is still an industry wide problem recruiting qualified staff,” Tulloch told Rural News.

“Like many other industries, the tractor and farm machinery sector must get better at attracting, inducting and retaining young people while also retaining older, more experienced staff. 

“TAMA absolutely has a role in this and we need to better promote the exciting career opportunities that exist in our sector.” 

More like this

Positive signs, says McClay

First up to the podium at the recent Tractor and Machinery Association (TAMA) Conference in Wellington, Minster for Agriculture, Todd McClay, reflected on a difficult 12 months, but hinted at signs that things were turning the corner, saying “when ag does well, New Zealand does well”.

Time to cast the net past China

A 2022 Nuffield scholar, Lucie Douma, was brought up on a Southland dairy farm and as a hobby likes the risky business of trail running and ultra marathons.

Tractor, machinery sales dip

The recent Tractor and Machinery Association (TAMA) conference in Wellington was signalling cautious optimism on the back of rising milk and store cattle prices and drops in interest rates.

Changing of the guard at TAMA

Deere NZ territory manager Jaiden Drought was elected new president of the Tractor and Machinery Association (TAMA) at its August annual meeting.

Signs of life in Aussie farm machinery market

Following a couple of bumper sales years when the rolling year-to-date figure for 2022 hit about 16,250 tractors, it looks like things are changing in the Australian farm machinery landscape.

Featured

Brendan Attrill scoops national award for sustainable farming

Brendan Attrill of Caiseal Trust in Taranaki has been announced as the 2025 National Ambassador for Sustainable Farming and Growing and recipient of the Gordon Stephenson Trophy at the National Sustainability Showcase at in Wellington this evening.

National

Machinery & Products

Farming smarter with technology

The National Fieldays is an annual fixture in the farming calendar: it draws in thousands of farmers, contractors, and industry…

RainWave set to cause a splash

Traditional spreading via tankers or umbilical systems have typically discharged effluent onto splash-plates, resulting in small droplet sizes, which in…

» Latest Print Issues Online

Milking It

Misguided campaign

OPINION: Last week, Greenpeace lit up Fonterra's Auckland headquarters with 'messages from the common people' - that the sector is…

Fieldays goes urban

OPINION: Once upon a time the Fieldays were for real farmers, salt of the earth people who thrived on hard…

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter