’05 tractor sales expected to be mixed

MILWAUKEE, Wis. – Agricultural machinery manufacturers expect total retail sales of two-wheel drive tractors in 2005 to increase 1.4 percent in the United States, while sales of four-wheel drive tractors in the U.S. market are predicted to decline by 8.8 percent.
Industry forecast. These predictions are included in the just-released annual State of the Ag Industry Outlook report produced by the Association of Equipment Manufacturers.
Negative retail sales of self-propelled combines are also expected, with U.S. sales of the machines anticipated to drop 2.9 percent.
For other types of farm-related equipment covered in the forecast, both U.S. and Canadian sales are expected to increase in the majority of machine categories.
Smaller is bigger. For two-wheel drive tractors, the most growth is seen for machines in the under-40 PTO HP range – a gain of 3 percent in the U.S. and a 9-percent increase for Canada.
Retail sales to the U.S. are predicted to be flat for two-wheel drive tractors 40-100 PTO HP and decline 4.8 percent for two-wheel drive tractors that are 100 PTO HP and over.
Market drivers. The ag industry outlook asked agricultural equipment manufacturers to forecast anticipated changes in 20 factors that have emerged as key influences on the sale of new equipment.
Interest rates are expected to be modestly up in the U.S. by 78 percent and modestly up in Canada by 55 percent. Credit availability is predicted to be about the same in the U.S. and Canada by 59 percent of respondents.
For U.S. sales, 44 percent see farm cash receipts and net farm income as being modestly up, while for Canada 45 percent anticipate farm cash receipts to be modestly up and 48 percent see net farm income as modestly up.
The impact of beef prices is expected to have a greater impact on Canadian sales than on U.S. sales (modestly up 39 percent for the U.S. and 48 percent for Canada).
The prices of new as well as used equipment is seen as modestly or significantly up as a factor for U.S. sales by the majority of respondents, with less change seen for quantity of used equipment and replacement demand.
What’s hot. For farm field equipment other than tractors and combines, the strongest growth in U.S. sales is predicted for self-propelled sprayers, with an increase of 8.8 percent by year-end 2005.
That’s followed by gains in the 3 percent range for farm loaders (up 3.9 percent), field cultivators (up 3.8 percent) and air seeders/drills (up 3.2 percent).
U.S. sales are expected to be the slowest for forage harvesters, with a decline of 4.7 percent, and rectangular balers, with a 4.4 percent drop in sales predicted.
Parlor talk. For farmstead equipment, sales of milking parlors are anticipated to increase 3.3 percent in the U.S. by year-end 2005.
Gains in sales of cooling tanks are expected for both the U.S. and Canada in 2005 (up 2.3 percent for the U.S.).