Australians may be shirking new cars but the nation's farmers are reaching for their cheque books to sign up for the latest machinery and equipment.
Incredibly, in the face of the global economic crisis, the tractor sector is on track to sell nearly 12,000 units for the '08 sales season, or more precisely 11,997 units.
This compares to 10,822 sales in the previous year, thereby shrugging the almost daily dose of bad news being delivered by the world's auto-industries.
These points were made on the eve of this year’s Tractor and Machinery Association of Australia (TMA) meeting and forum staged in Brisbane where the lobby group tackled a range of industry issues.
Noted Agriview analyst Alan Kirsten remains upbeat, suggesting the outlook "is positive", certainly in the short term.
"Everyone's asking when the bite (recession) is going to hit – but at the moment it doesn't appear to be on the horizon," he said.
Mr Kirsten has been tracking industry sales trends for many a year noting, in previous economic downturns – especially during the '80s and '90s – the rural economy trended towards recessionary levels ahead of the rest of the country.
"But this time I'm suggesting we are lagging it (the national economy) by about 12 months," he added.
While Mr Kirsten says while it will be difficult to sustain tractor sales – a useful barometer of industry health – the reality is they won't "fall off the tree" during the next 12 months.
"There will be some weakness in the market in the under 60hp sector which is heavily influenced by the lifestyle market," he said.
"But that's been operating at historically high levels for the last three to four years."
Interestingly, while there have been encouragingly strong machinery industry sales over the past couple of years, it has been at the expense of the broadacre sector.
Agriview says improving early sales last year for this 'big-ticket' sector was at the expense of supply shortages that saw factories across Europe and North America trying to keep pace with demand, ahead of the global economic crisis
"I'm not convinced it (supply) will improve markedly this year," Mr Kirsten said.
"There's still some pressure on supply – particularly on the header side."
Returning to the robustness of the Australian farm machinery industry, Mr Kirsten said that since the serious downturn of 2000, most companies had implemented new business models.
"Today, they are better managed, by business people, with no room for a lifestyle-type approach to farming," he said.
As well, having travelled extensively around farm machinery dealerships in Victoria and southern Queensland during the last six months, he is not aware of any extensive shedding of staff.
"At the end of the day, there's still a huge population growth worldwide," Mr Kirsten said.
"While economic growth has slowed – particularly in the dairy sector – farmers are still investing in new plant and equipment."
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