Agrievolution - Global Alliance for Agriculture Equipment Manufacturing Associations



AEM

USA - Association of Equipment Manufacturers
Ag Tractor and Combine Sales.png
Ag Tractor and Combine Sales.png
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Demand by Product.png

North American Agriculture Equipment Market Update

2023 TRACTOR AND COMBINE SALES

Through August, combine harvester sales show continued gains in unit sales while large ag tractors (2WD 100+ HP and 4WD tractors) also show sizable gains compared to 2022 during the same time period. In particular, 4WD tractors are up 34% YOY.

Total U.S. ag tractor unit sales are down 9% from the same period in 2022. Driving this decline are the notable decreases in tractors under 100HP; 40-100 HP sales are down 8% YOY, while sales of smaller, under 40 HP tractors are down 12%.

In Canada, combine harvesters are up 33% compared to the previous period last year. Large ag tractor sales are not up as sharply in Canada as the US – 4WD tractors are up 16% YOY, while 100+ HP 2WD tractor sales are up 3% YOY. However, sales of 40-100HP 2WD tractors are down 8% and sales of under 40HP tractors are down 20%. This combines for a net 14% decrease in total tractor sales YOY, compared to the 9% in the U.S.

A LOOK AHEAD

According to a recent AEM survey, the industry’s expectation of future demand finally returns to its pre-covid “neutral” level. The majority of the industry’s executives foresee demand of whole goods, parts and 12-month planning to remain flat or attain a normal growth, at best. This modest expectation is likely driven by increased risk and uncertainty in macroeconomic, farm economic, geopolitical, and weather outlook with direct impacts on US agricultural markets including farm equipment.

Recession risk remains a concern given current expectations of a prolonged high interest rate period. Geopolitical risks, sluggish global economic growth (China, in particular), strengthened US dollar, and increasingly more tense trade relations with China and Mexico are all forces that, if persisted, will likely sum-up to a net-negative impact on the US farm economy. In addition, the US farm economy will continue to be affected by three major near-term challenges.

Delayed signing of the Farm Bill, increased export competition from Brazil, and increased cost of logistics and transportation from farms to ports, vice versa, are all factors that will affect US farmers’ input procurement and production decisions for this coming year, including the purchase/renewal of farm equipment.

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AGRIEVOLUTION
The Agrievolution Alliance is the global voice of agricultural equipment manufacturers
that represents over 6000 companies around the world.
www.agrievolution.com

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