There’s rather a lot taking place within the equipment sector currently. Large-ticket equipment gross sales pushed by greater than ordinary commodity costs, and confidence that these costs are going to remain the place they’re for some time, are actually components. However, there’s additionally a problem in supply of models.
Within the second quarter of 2021, cash that had been diverted by the pandemic from journey and different affected actions into the small tractor market has began to return to regular use, in response to the Affiliation of Equipment Producers (AEM). Nonetheless, sustained ag commodity value beneficial properties have resulted in farmers persevering with a shopping for spree for bigger tractors and harvesters, as mirrored within the group’s month-to-month Ag Tractor and Mix studies.
Curt Blades, senior vice chairman of ag companies at AEM, printed a weblog put up by AEM’s web site, explaining why there’s a decline in stock at dealerships, in comparison with one yr in the past.
“I think everyone knows, if you’ve tried to purchase anything — whether that’s a truck, a tractor, a combine, a pinball machine — whatever it is, everything’s in short supply right now,” says Blades. “We’ve got significant supply chain issues, kind of around the globe. Largely related to the pandemic, but not exclusively related to the pandemic.”
The supply chain is tight, and demand has been actually strong within the final months. Semi-conductors are completely a part of it, says Blades, a problem that’s fueled by the elevated demand in client electronics because the onset of the pandemic, which made the difficulty extra distinguished.
Letting the calendar flip over just a few extra months will clear the supply chain points up, says Blades, and the sunshine on the finish of the tunnel is the discharge of stress — optimism amongst farmers is strong.
Ag dealerships are in a position to thrive when there’s demand for brand new and used equipment, and with that optimism and strong ag economic system, there’s quite a lot of demand for equipment on the market, Blades says.
Hearken to the total dialog with Blades and RealAg Radio host Shaun Haney, for particular gross sales numbers, or obtain for later: