Throughout 2023, farmers were “cautious” about committing to machinery purchases, due to current market conditions, according to a knowledge report from Genfitt, in partnership with Agriland.
It showed that in terms of spending and investment in machinery, the vast majority (60%) of respondents, have spent or plan to spend under €10,000 on machinery.
The Genfitt Knowledge Report 2023 was based on a survey, ran through Agriland, which received 3,648 respondents, including farmers, re-sellers and Original Equipment Manufacturers (OEM).
Genfitt, which employs over 60 people, was established in 1973 in Kiltimagh, Co. Mayo to supply spare parts and accessory products to re-sellers and retailers in the farming, engineering and hardware trades.
The report highlighted that only 30% of farmer respondents plan on spending in the €10,000-€50,000 range.
A total of 7% fell into the €50,000-€100,000 bracket, and a further 3% have spent or will spend over €100,000.
The price of machinery has continued to increase this year, and the expert focus group, which took part in the survey said this suggested that demand is going down as a result.
The group consisted of representatives from the Farm Tractor and Machinery Trade Association (FTMTA), Farm Contractors Ireland (FCI), Genfitt, and the farming media, as well as a farmer, a farm contractor, and a machinery importer and distributor.
“People are cautious about the future and therefore are not committing to large investments as they have done in the covid years,” the report stated.
The matter of the depreciation costs increasing on machinery was also highlighted.
One of the experts stated that over the last two years depreciation costs were up to 77%.
While non-agricultural sectors, such as construction ranked “particularly positive” with farmer respondents, the OEM market specifically was ranked as “below average”.
Re-sellers
For re-sellers participating in the survey, 14% felt that the cost and availability of farm machinery had been “very negative” for businesses this year, a further 39% cited it as being “somewhat bad”.
A similar figure, 36%, however, said there had been no effect.
The supply and availability of products; Delays in machinery delivery times; Parts procurement; and vehicle supply issues were all mentioned as challenges this year.
Looking ahead for re-sellers, the report said it is a “positive outlook”.
A total of 54% said they plan on making no investment in technology, while 46% said they will be investing, leaving a close to even split.
EU purchases
Challenges were felt in Europe across all agricultural sectors this year, according to the report.
Eastern Europe found itself in a difficult market due to inflation; for example, there was an 8% decline in tractor sales across Europe.
When asked for their thoughts looking further ahead to the end of 2024, the focus group predicted a tough 12 to 18 month outlook, possibly seeing a rise in confidence this time next year.
Whilst next year is expected to continue being a challenge, there will be predicted recovery in 2025, according to the focus group.