The latest tractor sales figures released by the Farm Tractor and Machinery Trade Association (FTMTA) show that for the first four months of this year, larger tractors of 120hp+ dominated the sales charts.
The association has divided the tractors sold into those of 121hp and above and these of 120hp or below, to give an approximate idea of how the market stands in relation to tractor size.
Turnaround in power demand
This year, the months of January to April saw 724 of the larger group sold as opposed to 343 of the smaller units. This a reversal of the situation in 2020 when just 594 bigger machines were sold against 621 lesser tractors.
It would be unwise though, to read too much into this split as there has been little consistency in the relative popularity of each power band over the last few years.
Total sales for the first third of this year showed an overall decline of 150 units on the 2021 figure, thus confirming a feeling in the trade that an ebb of confidence in the early part of the year had reduced sales.
Lead times create confusion
However, like most things in life, all is not what it seems for the sales figures are based on the registration of tractors and this may lag a long way behind the purchase decision.
Just to complicate matters further, the delivery time for different models will vary so making it impossible to pin down just what period the registration figures reflect.
We have moved on a long way from dealers having a stock of Ford 4000s or Massey Ferguson 135s in the yard just waiting for farmers to drop in and drive one away.
With the increasing sophistication and ability to customise tractors, lead times have increased to months and now, with the steel and component shortages, that can extend to a year or more.
Larger tractors winning out
The total registration figures have therefore become something of a blunt instrument in measuring the fiscal health of farming, they will certainly allow comparisons between years, but little more.
However, there does remain some devil in the detail and with the breakdown of power ratings, even such a crude one as we have here, the take away item is that the sub-120hp bracket appears to have slowed down.
If we assume that dealers ordering tractors for stock are likely to buy smaller machines, which don’t tie up as much capital, then this might better indicate the state of the market.
Balancing the years
The number crunching is not reassuring. The average for January-April in the five years up to and including 2021 is 461. This year’s figure is 343, the lowest for the past six years.
That being said, the total for 2021 was remarkably high at 621, so it might be thought that this year’s slump was due to last year’s boom.
This assumption is born out by averaging the two years which results in 482 units of less than 120hp sold per year, or just above the medium-term average.
Prediction for 2022
As always with statistics, trends and conclusions can be extracted from raw data to confirm a bias rather than accurately reflecting the true picture, so it is wise not to overanalyse the figures in any particular way.
Historically, 53% of tractor sales occur before the end of April. If we apply this to the latest sales figure of 1,102 units so far in 2022, then we can expect a total of around 2,080 units to be sold this year.
This is down on last year which saw 2,366 units being sold, but is still happily above the five-year average of 2,007.
On the plus side, lower sales may well reduce the lead times, although cost is dependent of far too many other factors to be greatly affected by a slackening of demand.