Increase in rural income, rich harvest drive speedy recovery of tractor sales

NEW DELHI:  Despite rising diesel prices and the on-going farmers’ protest in the northern states, sales of tractors have witnessed a significant growth in February 2021. The growth, according to industry leaders, comes on the back of a healthy sowing season and rise in rural income.

“We have sold 27,170 tractors in the domestic market in February with a growth of 24 per cent over last year. Demand continues to be robust with Rabi sowing at an all-time high, supported by healthy reservoir levels and higher liquidity with farmers, on account of timely and robust procurement of Kharif crops,” said Hemant Sikka, President - Farm Equipment Sector, Mahindra & Mahindra.

He added that the outlook for the industry continues to be positive given the all-time high estimates of Rabi production and strong rural cash flows.” Rival Escorts Agri Machinery has reported a 33 per cent increase in domestic tractor sales at 10,690 units in February. Escorts said that the supply side situation is normal but rising inflation continues to be a worry.

The automobile industry has warned if petrol and diesel prices continue to go up, it will impact automobile sales, including tractors. In the past one month alone, diesel prices have gone up by around `5. Truck sales, on the other hand, witnessed a significant uptick in February after nearly two years. Even as the growth is achieved on a lower base, it reflects an increase in manufacturing and infrastructure activities.

“Medium & Heavy CV tipper trucks segment has displayed a rebound due to a gradual rise in economic activity. The resumption of construction-based activities, as well as announcements of new projects post-lockdown, have been major catalysts for the rise in demand of these trucks in the last six months,” said a Tata Motors spokesperson.