AGCO Expects Equipment Sales To Fall In Brazil

AGCO Corp said that Brazilian industry wide combine-harvester and tractor sales may fall next year due to the current global credit crisis, AgriMarketing reports.

Domestic sales of combine-harvesters are likely to see the biggest drop of farm machinery in 2009, to between 3,000 and 3,500 units, from more than 4,000 expected to be sold in 2008, mainly due to the difficulty in getting financing, said Andre Carioba, South American president of AGCO.

Brazilian combine-harvester sales, which were fewer than 2,000 units in 2007, are generally reliant on loans from banks or the lending arms of manufacturers, while the cheaper tractors can often be bought with the farmer’s own money, the company said.

Carioba said domestic sales of tractors, the most sold type of farm machinery, should reach around 43,000 units in 2008, above last year’s sales figure. However, Carioba warned that tractor sales will dip to around 38,000 units in 2009 if the financial crisis continues. He said that 3,500 tractors and 350 combine-harvesters were sold in November.

AGCO Corp said it intends to maintain its investment plan of $150 million between 2008 and 2010 in Brazil. The company aims to open a new spare-parts distribution center in Sao Paulo state, in place of four existing centers, in 2009. ❖