Compact Tractor sales Off 31%

[wallace]

congrats on the deal. I am trying to get 0% for 48/mos. I wouldn't mind 3.9% for 60 or 72 mos.

I'll give you 3.25% for 60 months and 3.75% for 72 months on a new Kioti.....

 

[RoyJackson]

I expect some of the badge engineered imports to die out...especially the ones that have little or no dealer network or factory support. This might reduce some of the forums on TBN, by the way.
Even some of the larger offshore manufacturers may pull out of US sales.
It's really going to depend on how long this recession goes on.

 

[froggy]

It's really going to depend on how long this recession goes on.

Take a look at the ads in the local papers, Ebay and Craig's list. More and more late models tractors of all sizes are being put up for sale. Think this trend will only get worse.

 

[ChallengerMT265B]

For The last 5 or so years the sales of >40hp compact tractors
have grown by 20%. Then last year, sales fell 3-5% giving
a 23+% drop. I have not seen the numbers for this year.
The market has become quite crowded with 15+ brands. In the 1980's, some manufacturers, ie Yanmar, Mitsubishi/Satoh?, pulled out of the U.S. leaving J.D, M.F, Ford New Holland, and Kubota to survive the economic downturn.

 

[seapea]

For The last 5 or so years the sales of >40hp compact tractors
have grown by 20%. Then last year, sales fell 3-5% giving
a 23+% drop. I have not seen the numbers for this year.
The market has become quite crowded with 15+ brands. In the 1980's, some manufacturers, ie Yanmar, Mitsubishi/Satoh?, pulled out of the U.S. leaving J.D, M.F, Ford New Holland, and Kubota to survive the economic downturn.

That would be a 23% drop in sales growth, not the a 23% drop in sales. Reminds of how our government whines about "budget cuts". Usually when a government office says it has had its budget cut, what it really mean is that the budget will not be growing by the amount it was originally targetted for. When their budget is frozen or increased by a smaller amount than expeced, they claim the budget has been cut.

 

[froggy]

0< 40 HP -22.0% YTD over last year sales
40 < 100 HP -18.4% YTD over last year sales
100+ HP +28.3% YTD over last year sales​

Total 2WD Farm Tractors -15.1% YTD over last year sales


These actual sales figures are from the website CCI posted.

 

[Barneyhunts]

The local Kubota dealer has consolidated two sites into a nice new, large showroom and separate service facility. Seems to always be busy!
Closer to me

 

[lawn_king]

Thankx nuru, i got 3.9 on my B3030 package in 2005. I was thinking it would be nice to get another good rate. I think $70,000. on kubota tractors (3) in 8 years entitles me to a good rate!

 

[Builder]

100+ HP tractor sales are up because farmers are getting the highest crop prices in recent history. Food has jumped and ethanol is driving corn prices up. Times are getting better for farmers, so they're buying new 100+ HP tractors. Many 100HP + tractors are domestic and with the lower dollar are a better buy globally.

The under 100HP size is usually imported construction/landscaping/hobby farm size tractors and all that is on the downside nationally because of the failing economy and shrinking value of the dollar since most of these tractors are imported.

 

[HayDR]

100+ HP tractor sales are up because farmers are getting the highest crop prices in recent history. Food has jumped and ethanol is driving corn prices up. Times are getting better for farmers, so they're buying new 100+ HP tractors. Many 100HP + tractors are domestic and with the lower dollar are a better buy globally.

The under 100HP size is usually imported construction/landscaping/hobby farm size tractors and all that is on the downside nationally because of the failing economy and shrinking value of the dollar since most of these tractors are imported.

I don't think you understand that a high corn price is very hard on the dairy industry, Beef Cattle, Poultry industry & Pork producers. Be ready to see premium cuts of beef to double in price. These corn prices may also drive cola MFG's back to sugar.

 

[Blee25]

I don't think you understand that a high corn price is very hard on the dairy industry, Beef Cattle, Poultry industry & Pork producers. Be ready to see premium cuts of beef to double in price. These corn prices may also drive cola MFG's back to sugar.

Also, for every sent that the price of grain has gone up so has the price of every type of imput. Even corn/soybean farmers aren't ended up with much more money in there pocket then a couple years ago. The beef, pork, dairy, farmers have to be feeling the hurt.

 

[Builder]

I don't think you understand that a high corn price is very hard on the dairy industry, Beef Cattle, Poultry industry & Pork producers. Be ready to see premium cuts of beef to double in price. These corn prices may also drive cola MFG's back to sugar.

OK, I understand that, but how about all the corn farmers? How they doing with these increased profits? Rice & wheat are up, too? Doesn't that line their pockets with more money? Sure it does.

If I'm incorrect, then who's buying all the extra 100+ HP farm tractors in the US?

 

[john_bud]

Don't forget that WORLD demand for small grains is up. I wonder if the weak USD is quieting the demand for the <50hp machines which are 100% imported? Also "real" farmers are able to buy more with the generous depreciation in the stimulus package, so them getting a larger tractor makes sense.



Actual acreage of corn is steady to dropping from what I hear. Beans and wheat are up. There is more land being returned to production also. You do know that there are many many many less acres under production to help keep prices up and that those programs are still being funded? What a government.... prices way up and farmers still paid to not farm!


jb

 

[Farmwithjunk]

OK, I understand that, but how about all the corn farmers? How they doing with these increased profits? Rice & wheat are up, too? Doesn't that line their pockets with more money? Sure it does.

If I'm incorrect, then who's buying all the extra 100+ HP farm tractors in the US?

There's a fine line between "increased profits" and actually turning a profit for the first time in years. The recent raise in commodity prices is merely giving SOME farmers a chance to replace a lot of older equipment, pay off SOME debts, and regroup. Even with grain prices doubling, inputs and operating cost's have kept pace with the additional income. Land prices (both purchase and rental/lease) have skyrocketed.

The hopes (false hopes?) that increased grain sales dollars are here to stay have sent a lot of farmers out in search of more land, more equipment, and with that, more DEBT. One only needs to look back to the late 1970's to see a parallel in history....... The run-up to the farm crisis of the 1980's.......

So, YES, grain prices are responsible for recent increased sales of 100+hp tractors, but those increased grain prices might not be a true indicator of "GREAT DAYS AHEAD" for farmers. More of a blip on the radar screen indicating trouble ahead.

 

[riptides]

The hopes (false hopes?) that increased grain sales dollars are here to stay have sent a lot of farmers out in search of more land, more equipment, and with that, more DEBT. One only needs to look back to the late 1970's to see a parallel in history....... The run-up to the farm crisis of the 1980's.......

The current problem is that banks are going bust on lending. You cannot get into DEBT anymore. And the DEBT you owe is probably more that your assets are worth. Hence, people are finding it easier to walk away from their current DEBT.

Land prices are somewhat stable. House prices are free-falling.

-Mike Z.

 

[Farmwithjunk]

The current problem is that banks are going bust on lending. You cannot get into DEBT anymore. And the DEBT you owe is probably more that your assets are worth. Hence, people are finding it easier to walk away from their current DEBT.

Land prices are somewhat stable. House prices are free-falling.

-Mike Z.

While that may be true in the housing market, farm credit is still readily available. It has been for years. Equipment manufacturers still offer their own credit to "qualified customers". Many farmers locked in to credit obligations over the past few years and are commited to them through thick or thin. With the increase in commodity prices, MOST farmers are seeing their rent raised by land owners who want a piece of the action. Average per acre land rental has gone up over 50% in this area in 2 years. Farm ground has been swallowed up by developement for ages. They don't make MORE farm land. Prices on GOOD farm ground have risen and continue to do so as more land is taken out of production.

From someone who 2 years ago sold 190 acres for 33 times what I paid for it 30 years earlier, I'm fairly convinced land values are indeed rising at a staggering rate. I took part of the proceeds from that sale and bought 45 acres. 2 years later, I'm entertaining offers nearly double that investment. They're still rising.

There's quite a few of us who have "BTDT" during the 80's who saw our friends loose farms, their credit (and lives) ruined by the fallout of a situation oh, so simular as what is occuring in the ag world right now.

 

[Builder]

Look at loading docks at a major ports. The ones near where I live have lots of new green & red tractors sitting there waiting to get on big ships and find new homes where different languages are spoken. Coincidentally, where they are going, they have currencies that buy more dollars than they did 3-5 years ago.

What that means is that America is exporting more tractors, one of the reasons sales are up on 100+ HP.

Higher farm land values just give farmers a more valuable asset to borrow more money for more new 100+ HP tractors.

 

[Farmwithjunk]

Higher farm land values just give farmers a more valuable asset to borrow more money for more new 100+ HP tractors.

That works to the farmers advantage when, (A) they OWN the land, as opposed to renting, MOST cash grain farm land in the US is rented. And (B) when the AG economy is on the upswing. Hit a downturn and that very same "advantage" just turned into runaway debt. Anyone who farmed throught the 1980's can attest to that. At least the ones that didn't put a bullit through their temple.

 

[riptides]

An interesting commentary on the economic climate is posted in the link.
It is any easy read (not lengthy, no big confusing words) but offers no solutions other than what is painfully happening today.

Armageddon?

 

[BungeeII]

Read the first paragraph here and tell me if it doesn't sound familiar.

The Main Causes of the Great Depression

Speculators had their money in the mortgage market and are now throwing it into oil. We're in a recession and the cost of living increases are pinching everyone who's not solidly in the middle class or higher. I'm not smart enough to say what's going to happen, and it's been a long time since I was in school, but I thought recent market developments sounded familiar.