Farm tractor and combine sales dipped in the first quarter as the agricultural equipment market remained weak due to tariffs and market uncertainty.
Demand for farm equipment weakened in March, cementing a double-digit decline in sales of tractors and combines during the first quarter, according to the Association of Equipment Manufacturers (AEM).
Total U.S. farm tractor sales, including two-wheel drive and four-wheel drive units, landed at 36,629 in the first quarter, down 15.1% year over year, according to AEM’s monthly U.S. Ag Tractor and Combine report. U.S. self-prop combine sales totaled 522 units, down 56.5% YoY.
Total U.S. farm tractor sales were 16,180 units in March, down 13.6% YoY, according to the report. Meanwhile, U.S. self-prop combine sales finished at 241 units, down 37.7% YoY.
The decline in tractor and combine sales comes as farmers, manufacturers and AEM’s global partners face economic and tariff uncertainty, Curt Blades, senior vice president of AEM, told Equipment Finance News.
“In the absence of certainty, sometimes those things just sit on the sidelines for a while. Money just sits on the sidelines,” he said. “That’s the meat of the story right now, and that may change. … It’s an uncertainty play.”
Used dealer inventory is a key indicator for the health of the ag equipment industry, Blades said.
“Whenever there has been a crisis in the equipment market — there have been a couple of them over the last 20 to 30 years — it’s always been tied to too much used inventory,” he said. “Too much used inventory resulting in the erosion of prices, and the erosion of prices and values hurts everything. There’s a ripple effect.”
Canadian tractor market diverges
Total Canadian farm tractor sales landed at 4,557 units in the first quarter, up 12% YoY, according to AEM’s monthly Canadian Ag Tractor and Combine report. But Canadian self-prop combine sales totaled 328 units, down 14.4% YoY.
Total Canadian farm tractor sales reached 1,886 units in March, up 18.6% YoY, according to the report, while Canadian self-prop combine sales finished at 218 units, up 69% YoY.
The Canadian agricultural market is unusually strong, which is notable given that the U.S. and Canadian markets normally rise and fall in tandem, Blades said. While it’s unclear what’s driving this divergence, possible factors include greater market certainty or anticipation of tariffs, and manufacturers reporting optimism about Canadian tractor sales.
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