The tractor shortage is real, but it can be beaten

The fact that tractor sales, by unit, are down this year is well established, the reason for why this is so is a little more contentious.

The tractor shortage is real, but it can be beaten

Trade organisations and manufacturers are keen to stress that demand remains strong despite the cost of energy, materials and component shortages driving prices up and keeping them high.

Signals from the US

This position appears plausible, yet there are alternative views emerging and awkward facts, such as the halving of steel prices from their peak in 2021, which question this general belief.

Further confirmation of this shift of mood comes from the US in the form of the latest barometer of agricultural sentiment published by Purdue University of Indiana.

Tractor, investment, shortage
Farmers are fighting shy of large investments, although sales of bigger tractors have held up in Ireland

In its review of November it clearly notes that a clear majority of the US farmers surveyed believe that now is a bad time to make large investments, a major reason given being the cost of machinery.

Increasing interest rates and uncertainty of farm profitability were also concerns, but neither matched the 47% that placed machinery cost at the top of their lists.

All boom in the boardrooms

However, this brake on farm investment has not stopped the major manufacturers enjoying records sales figures, if not volumes, over the past year.

The big three tractor makers have happily indicated to their shareholders, if not their customers, that price increases have been implemented that go beyond increased production costs.

Manufacturers majers tractor
New Holland is one company that has reported successful price increases to its shareholders

At one level this is nothing more than the standard supply and demand model operating in plain sight. Business is business and farmers too have enjoyed price increases for their produce that often exceed the extra input costs.

It might be hoped that the two sectors will invest the surplus cash in improving the efficiency of both farms and factories, but the unfortunate fact remains for farmers, that even if they were were to head off down to their local dealer, wallet at the ready, there may be nothing to buy.

Order now for 2024

We are well aware of the overall stock shortage here in Ireland, yet there are reports from over the Atlantic of dealers with all their 2023 allocations being sold already.

John Deere has admitted that farmers ordering a new combine harvester now will have to wait until 2024 for delivery.

Yet the picture is a little more patchy nearer home. Smaller tractors appear to have a shorter lead time than larger units across the board, and the same is true of smaller brands.

Zetor tractor machine
Zetor is making a comeback in Ireland with up-to-date tractors

Both Tumosan and Zetor, for instance, have said that they have machines in stock at the factory, any delay is purely a matter of delivery rather than waiting for a machine to come down the line.

Agri-Argo is another which does not quote an endless wait for a tractor, although it will depend on the model and options selected.

Booking ahead

Closer coordination with the factory is the approach having to be taken by dealerships for the larger brands who are struggling to maintain tractor stocks for spot selling.

To shorten the lead time and help fulfil potential orders they are encouraged to book slots on the production line well in advance of any orders materialising.

It has certainly helped matters, and has enabled farmers to plan their machinery investment with a little more certainty, but it is still not ideal.

Other options

With such a variation over availability there may lie the opportunity for the eastern manufacturers to capitalise on the shortage.

One objection to an eastern tractor is that it will lack the digital sophistication of more expensive marques, yet many of the digital functions that are most commonly used can be retrofitted by third-party suppliers.

Trimble Co Cork Vantage
Vantage Ireland is able to supply Autosteer and other digital systems off the shelf

Vantage Ireland, of Co. Cork, has no supply issues at present and is able to install autosteer and other systems more or less on demand, with screens being readily available. This is often the component which is blamed for tractor shortages.

Despite the much spoken of shortage there are still options available to farmers looking to replace a tractor ready for the spring season. It may take a shift in brand loyalty, but it is not impossible.

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