MUMBAI: Domestic tractor sales will likely clock double-digit year-on-year growth in June given the strong recovery in demand following dismal performance in April because of the lockdown, said three people aware of the development.

The surge in sales has been attributed to a robust rabi harvest, timely arrival of the monsoon to aid kharif sowing, and government sops such as direct benefit transfers.

“Tractor sales in June have been very strong owing to the quick turnaround in rural activities post lockdown. Tractor production has jumped up about 50% YoY in June across factories. As manufacturers ramp up production at their plants, they expect robust tractor demand to continue during the September quarter,” said one of the three people cited above, requesting anonymity.

“Demand is robust due to various factors related to a strong rabi output, government spending in rural India, including higher procurement and good price realisations,” said Hemant Sikka, president, farm equipment, at Mahindra & Mahindra Ltd (M&M) said,

“Good reservoir levels and the start of a normal monsoon bode well for kharif output. Additionally, timely relaxation of the lockdown has enabled speedy recovery of the agriculture sector, all of which augur well for tractor demand,” Sikka added.

M&M’s domestic tractor wholesales had grown 2% YoY to 24,017 units in May. The company had tractor sales from its dealerships on 14 April following exemptions for essential commodities under the second phase of lockdown.

Raman Mittal, executive director, Sonalika Group said farmers’ sentiment continue to be upbeat and June deliveries are expected to surpass May numbers which 26% higher YoY.

“As per agriculture ministry update, the sowing of kharif/summer crop has jumped 40% YoY, supported by the timely monsoon. The phased unlocking of markets is helping facilitate deliveries. This coupled with increased kharif crops MSP (minimum support prices) ranging from 2-7.5% is a welcome initiative by the government which is expected to support tractor deliveries to reach its highest ever in June 20,” said Mittal.

Crisil has said that despite a 37% year-on-year decline in volumes in April and May, FY21 tractor sales will likely be just 1% below last fiscal’s numbers, in sharp contrast to a double-digit fall estimated for other vehicle sales.

It had earlier estimated an 11-13% fall in tractor sales in FY21.


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