AEM "state of the ag industry" outlook 2005.

Forecasts from the annual survey of members of the Association of Equipment Manufacturers (AEM) represent the average of responses from member companies in each product line among the 40 AEM farm field and farmstead type equipment manufacturers in the US and Canada. Responses represent member companies' forecasts for the industry as a whole.

Factors influencing future sales

The 20 factors, based on past surveys, have been identified as key influences on future new equipment sales and are grouped into four areas: Financial--Credit availability, Interest rates, Government programs, Farm cash receipts, Net farm income; Acreage--Corn, Soybeans, Wheat, Planted acreage, Grain exports; Livestock/Dairy Prices--Beef, Milk/dairy products, Hogs; Farm Equipment--Operator attitude toward purchases, Prices of new equipment, Prices of used equipment for sale, Quantity of used equipment for sale, Replacement demand/need.

Responding manufacturers rated the changes they expected to affect new equipment sales in 2005 in five categories--significantly up, modestly up, about the same, modestly down or significantly down.

Tractor and combine sales forecasts

A small increase of 1.2 percent is forecast for 2005 tractor sales in the US. The 2005 forecast for Canadian tractors sales is an increase of 5.8 percent. Sales forecasts for combines don't fare as well, with decreases in both US (-2.9 percent) and Canada (-6.6 percent). The percentages shown in the table represent the expected change from 2004 sales.

Other field and farmstead equipment forecasts

This table of forecasts for other field and farmstead equipment shows the average unit retail sales percentages expected by AEM members in their own product lines. The forecast percentages for 2005 are compared to the 2004 sales. (More information at www.aem.org)

Farm Wheel Tractors--
Actual 2004 Flash Data and 2005 Forecast

                              2004      2005       2004     2005
                              US        US         Canada   Canada
                              Flash     Forecast   Flash    Forecast

2WD Tractors
  Under 40 PTO HP             133,775   137,800    7,004    7,631
  40-100 PTO HP               71,135    71,123     6,568    6,965
  100 PTO HP & Over           19,885    18,925     3,477    3,518
Total 2WD Tractors            224,795   227,848    17,049   18,114

4WD Tractors                  3,604     3,287      718      680

Total Farm Wheel Tractors     228,399   231,135    17,767   18,794
Percent Change Forecast                 1.2%                5.8%

Self-Propelled Combines       6,683     6,489      1,564    1,460
Percent Change Forecast                 -2.9%               -6.6%

Field and Farm Equipment--2005 Forecasts

                               US Average   Canada Average
                                Forecast       Forecast

Rectangular Balers               -4.4%           7.6%
Round Balers                      0.5%           5.3%
Forage Harvesters
  (Pull & Self-Propelled)        -4.7%           3.7%
Planters                         -3.1%           3.5%
Mower Conditioners               -0.5%           6.2%
Windrowers/Swathers
  (Pull & Self-Propelled)         0.1%          -4.4%
Field Cultivators                 3.8%          -1.0%
Farm Loaders                      3.9%           4.3%
Chisel Plows                      1.4%          -7.5%
Disk Harrows                      2.5%           0.0%
Air Seeders/Air Drills            3.2%          -2.8%
Self-Propelled Sprayers           8.8%           8.5%
Milking Parlors                   3.3%           0.0%
Cooling Tanks                     2.3%           1.7%