Tractor Sales record all-time high volumes in a pandemic year!
Tractors Sales in the Domestic Market was 8,02,670 units in 2020 which was 11 percent higher than 2019 volumes and 1 percent more than the previous all-time record of 7,89,473 units, set in 2018. It is impossible to believe that the Industry achieved this feat in 2020 which was not only a pandemic year; but also witnessed the lowest monthly tractor sales total of 12,000 units in April 2020 due to the nationwide lockdown. This makes the achievement even more appreciable.
COVID-19 pandemic has influenced the lives of people across the globe and India is no exception to that. The farming activities also experienced the impact of this pandemic as the COVID-induced lockdowns influenced the movement of farm inputs including farm machinery from one location to another. The national lockdown coincided with the commencement of the harvesting season for the Rabi crops creating further adversity for the sector.
The migration of agricultural laborers to their native places during the lockdown created a shortage of farm Agriculture laborers. India’s agricultural system demonstrated its resilience amid such adversities. The agriculture and allied sectors were the sole bright spot amid the slide in performance of other sectors, clocking a growth rate of 3.4 percent at constant prices. Against all adversities due to COVID-19, continuous supply of agriculture commodities, especially staples like rice, wheat, pulses and vegetables, has been maintained thereby enabling food security.
The Trend for Tractor Sales for the past 11 years in the Indian market is as shown –
The Tractor industry has always been a barometer for the state of the rural economy in India. Indian tractor industry has become the largest market worldwide accounting for one-third of the global production! Indian tractor industry has seen a positive growth trend CY2020 and recorded its all-time highest domestic volumes in the calendar year.
The increase in tractor demand could be attributed to good monsoon, better finance availability and, even, increased MSPs and market rates realization. Good rainfall ensured healthy produce output in 2020 and for the coming year as well. Tractor Sales has also picked up in the last two years because loan waivers have allowed more farmers to access loans and lower interest rates have proved attractive as well.
The year 2020 saw higher manpower availability for agricultural purposes as a result of reverse migration from urban to rural areas after the imposition of the lockdown. Government support schemes such as MNREGA and PM-KISAN also helped bring fresh liquidity to rural incomes.
We have also tried to measure Sales of agricultural tractors basis horsepower category -
41-50 Horsepower category has the highest share and accounted for almost 47% of the sales!
It is closely followed by 31-40 hp category with 36% share (which was the market leader at one point of time)