Outlook & Trends

North American sales of large farm equipment remained solid in September, according to the latest figures released by the Assn. of Equipment Manufacturers.

“Sales of combines moderated in the seasonally most important month of the year, but still set a 10-plus year monthly high, while row-crop tractor comparisons remained strong against weak prior-year comparisons,” says Robert McCarthy, analyst for RW Baird.

While third-quarter large machinery demand appears modestly stronger than expected, farmers may be cautious about the new diesel engines in 2011. The relative youth of the existing fleet may also suggest current demand may not be sustainable,” McCarthy says.

• U.S. and Canada combine retail sales moderated in September, increasing 12.9% year-over-year after a 17.2% increase last month. This was the single highest monthly total in absolute sales levels since 1998, according to McCarthy.

• Inventory grew 5.5% year-over-year on an absolute basis, and represents 75 days-sales, which is up from 70 days last year.

• September sales of high-horse- power tractors were up 37% year-over-year following the 35% August increase. Row-crop tractor sales increased 43.1% year-over-year last month following a 45.2% increase in August. Row-crop tractor inventories declined 11.9% year-over-year, and now represent 108 days-sales, down from 120 in August 2009. September has accounted for 7% of annual sales over the past 5 years.

• 4WD tractor retail sales comparisons improved in September rising 16.6% year-over-year, up from 3.3% in August. Inventories increased 5% year-over-year on an absolute basis, but declined slightly to 82 days-sales from 84 last year. September is a seasonally average month for 4WD tractor sales.

• September sales of mid-range tractors fell 11.3% year-over-year compared with an 8% increase in August.