Can the Agricultural Equipment Market Rebound in 2020?
January 6, 2020 As 2019 finally winds down, it seems as if there are two distinct storylines impacting the world of agricultural equipment. For the most part, it depends upon a company’s size in the market as to what kind of year it ended up having.
To review a bit, 2019 was an extraordinary year for agriculture. Starting with a government shutdown (which kept agencies from reporting on planting intentions) and the ongoing trade war between the U.S. and China (which kept commodity prices low), the spring dovetailed into an overly wet mess, with several million acres of cropland in states such as South Dakota, Ohio, and Indiana never getting planted at all this year. This kept agricultural income among grower-customers extremely depressed throughout much of 2019.
Given all these issues, I expected agricultural equipment numbers for the year to be less than rosy. And for larger equipment makers, this was apparently the case. According to most sources, worldwide agricultural equipment sales for 2019 were down approximately 7% vs. 2018, with tractors and combines experiencing the worst downturns. On the other hand, self-propelled sprayer sales held their own, coming in basically flat for the year, driven somewhat surprisingly by sales to larger growers.
Loading ...For agricultural technology and building equipment suppliers, 2019 was a much better performer. According to several manufacturers in these segments, overall 2019 sales were “stronger for us” than the sales they had recorded during the 2018 growing season. In some cases, companies credited “setting our expectations a little lower than normal” for revenue being exceeded for the year.
Hopefully, as the industry moves into the 2020 growing season, some of the factors working against the agricultural equipment marketplace won’t repeat themselves. As always, we shall be watching …
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