Tractors sales rose nearly 48 per cent in January 2021 to 87,579 units, including 9,234 which were exported, from 59,367 units in January 2020. Month on month, sales increased after two months of fall. Demand was driven by expansion in rabi acreage, high reservoir levels and higher liquidity in the hands of farmers, among others.
While every segment of the auto sector felt the pressure due to the Coronavirus (Covid-19) pandemic, the tractor segment was the first one to revive and it continues to be the fastest growing in the auto segment.
According to the Federation of Automobile Dealers Associations, retail numbers for the month of January inicated that the only segment which was in green (11.14% growth) was tractors, while other segments were in red.
Tractor Manufacturers Association (TMA) data shows tractors sales in October 2020 stood at 123,883 units, including 8,728 exports, highest since 2018. However, sales dropped in November and December to 89,530 units and 71,740 units, respectively. In January, sales picked up again with 87,579 units sold.
Mahindra & Mahindra Ltd’s Farm Equipment Sector, part of the $ 19.4 billion Mahindra Group, reported a 50 per cent growth in domestic sales in January at 33,562 units from 22,329 units in the year ago period. Exports grew 55 per cent to 1,216 units from 787 units. Overall sales in January rose by 50 per cent to 34,778 units in January 2021 from 23,116 units last year.
Hemant Sikka, president of the Farm Equipment Sector at Mahindra & Mahindra Ltd, said, "Tractor demand continues to be strong with expansion in rabi acreage, very high reservoir levels and higher liquidity in the hands of farmers with timely kharif procurement."
"Demand is expected to remain robust on account of these factors and higher allocations which are expected for agriculture in the upcoming Budget in line with the government’s continued focus on the agriculture & rural sector. In the exports market, we have sold 1,216 tractors, a growth of 55% over last year,” he said.
Escorts Ltd's Agri Machinery Segment sold 9,021 tractors, the company's highest ever sales in January, registering a growth of 48.8 per cent against 6,063 tractors sold in January last year. Domestic tractor sales in January 2021 stood at 8,510 tractors, a growth of 45.6 per cent against 5,845 tractors in January 2020.
Company stated that the tractor market continues to be strong on the back of positive macro-economic factors and strong rural cash flows. The supply side situation is normalising and is no longer expected to be a bottleneck to meet demand. However rising inflation continues to be a worry.
Company's Chairman and Managing Director Nikhil Nanda said, “agriculture demand for tractors and farm mechanization is witnessing a continuous growth. We are hopeful of a sustained momentum as we see strengthening in farm and rural economies.
Export tractor sales in January 2021 was at 511 tractors against 218 tractors sold in January 2020, registering a growth of 134.4 per cent.