Tractor Industry Set for Rebound After 7% Sales Dip in FY23-24

India's tractor industry is quite large and it also has a good influence in the global agricultural sector. However, in terms of growth in the last one year, the graph of the Indian tractor industry has been quite uneven. Tractor sales in FY 2023-24 were lower than in FY 2022-23.

Tractor Industry Set for Rebound After 7% Sales Dip in FY23-24
Tractor sales decreased by 7 percent in FY23-24

Tractor sales in FY 2023-24 were lower compared to FY 2022-23. Domestic sales decreased by 7 percent, while exports dropped by 22 percent from the previous year. The decline in domestic sales last year was attributed to a poor monsoon. However, a normal monsoon is expected this year, which is anticipated to boost tractor sales.

El Nino effect on tractor industry 

According to the Tractor and Mechanization Association (TMA), total domestic tractor sales in FY 2023-24 were 874,504 units, compared to 940,985 units in FY 2022-23. The primary reason for this decline is attributed to reduced Kharif crop production due to last year's weak monsoon. The TMA reports that weak agricultural activities, caused by the monsoon and unseasonal rains, significantly impacted the tractor industry, leading to lower sales. The poor monsoon in FY 2023-24 adversely affected Kharif crop production, which in turn negatively impacted tractor sales.

Tractor sales report 

Manufacturer                                       FY23-24     FY22-23 %Change
Mahindra & Mahindra 3,64,526          3,89,531              -6.42%  
TAFE                             157,503         1,69,843         -7.27%
Sonalika                     1,15,369 116,000         -0.54%
Escorts Kubota 90,239         95,266           -5.28%
John Deere 71,408   82,658     -13.61%
New Holland 34,697 35,367 -1.89%
Kubota 18,538   25,710 -2.79%
Indo Farm 5307           6445             -17.66%


5,488         6,390             -14.12%
VST Tillers Tractors 3708           5422             -31.61%
Captain 4548             4,254               6.91%
ACE     2475           3,074 -19.49%
SDF     698 1,025 -31.90%  
Total 8,74,504 9,40,985         -7.07%

(Source: TMA)

Good growth expected in FY2024-25

Industry analysts note that despite domestic sales ending on a slow note in FY 2023-24, there is a ray of hope in exports. The IMD has also forecast a good monsoon this year, which is expected to boost tractor sales. According to TMA, domestic tractor volumes will improve, and the industry may register a modest growth of 3-5 percent in FY 2025. This optimism is driven by the expectation of a promising monsoon season, which is anticipated to lead to higher farm incomes and a lift in the rural economy.

Mini tractor sales increased in India

The sale of mini tractors in India has surged rapidly in recent years. These tractors are more suitable for small farms and domestic use. The main drivers of this increase are technological advancements in agricultural production and the growing demand for mechanization in agriculture. Additionally, the quest for higher yields, the increasing scarcity of land, and improvements in the financial standing of farmers are also boosting this market. Consequently, the sale of mini tractors in India is on the rise.

45-50 HP tractors most popular among farmers

In India, tractors are available in various ranges, each distinguished by its features and capabilities. However, 45 to 50 HP tractors are the most popular among farmers. The special appeal of tractors in this range is their versatility; they can easily handle many commercial tasks, including farming. Farmers prefer these 45 to 50 HP tractors because they consume less fuel than heavy-duty tractors and can operate almost all agricultural equipment.

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