Drought impact: Tractor sales dive

It’s going to be a bad year for tractor makers. Tractor sales in India, the world’s largest market, dropped 20.5 per cent in the nine months ended December 2002 from a year earlier as the country’s worst drought in nearly 15 years hit the farm sector.

It is for the second time in recent years that tractor sales have fallen steeply. Data from the Tractor Manufacturers’ Association released on Tuesday showed 10 Indian companies sold 121,612 tractors in April-December, the first nine months of the financial year, down from 152,880 a year earlier. Production during this period fell 23.1 percent to 115,949 units.

Rainfall during this year’s southwest monsoon, which runs from June to September, was the lowest in nearly 15 years which hurt crop output and farm incomes. The country gets 80 per cent of its rainfall from the monsoon and more than two thirds of its billion-plus population depends on agriculture for its income. “Farmers are spending less on purchasing farm equipment this year,” said an analyst. Tractor sales dived 13.6 per cent last year as surplus grain production caused crop prices to drop and hurt farm incomes. India’s agriculture output jumped 5.7 per cent in the past year to March, rebounding from a 0.2 per cent fall the preceding year. Sales in the less than 21-30-horsepower segment fell 20.1 per cent in April-December, sales in the main 31-40-horsepower (hp) tractor segment dived 18.4 percent and in the 41-50-horsepower segment they dropped 11.7 per cent.