U.S. retail sales of small farm tractors under 40HP increased 1.7 percent in November 2015 compared to the same period last year, according to the Association of Equipment Manufacturers (AEM). Year-over-year, total retail sales of two-wheel drive farm tractors, including under 40HP, were down 8.9 percent, a reversal from last month’s 5.8 percent growth. This is mostly due to a lower year-over-year growth in less than 40HP and a reversal in growth for the 40-100HP categories. Four-wheel drive tractors sales decreased by 43.9 percent, down from a 29.5 percent decrease in October. These growth number are now back in line with the trends seen earlier in the year.
Year-to-date sales of the smaller, less than 40HP tractors increased 7.7 percent compared to 2014, while sales of 40 to 100HP farm tractors turned negative again. In a more long-term comparison, retail sales in units for agriculture tractors and combines are reporting slightly below the five-year average.
“Sales of large production tractors and combines have been impacted this year by some significant trends that we have been seeing all year,” said Charlie O’Brien, AEM senior vice president. “In many cases, the farmer’s profits have evaporated due to low corn and soybean prices, resulting in projected Net Farm Income for the year to be $55.9 billion, which is 38 percent down from last year.”
“What’s more, the tremendous volume of equipment sales in 2012 and 2013 has created a glut of used equipment on dealer lots, which has greatly impacted the sales of new equipment. In addition, ongoing uncertainty about the impact of the Renewable Fuels standard and Section 179 continue to negatively influence buying decisions,” continued O’Brien.