The tractor industry has begun the fourth quarter of FY25 on a strong note, registering both year-on-year and month-on-month growth in domestic sales during January. While exports increased year-on-year, they declined compared to the previous month.
Total domestic tractor sales stood at 61,923 units in January 2025 when compared with 55,589 in January 2024, posting an increase of 11 per cent. Sales also saw a 21 per cent jump from 50,993 units in December 2024, as per data from the Tractor and Mechanization Association (TMA).
Leading tractor manufacturer Mahindra & Mahindra recorded a 15 per cent increase in domestic sales at 26,305 units in January 2025 compared to 22,972 units in the same month last year. For the first nine months of FY25, its domestic volumes rose by 10 per cent to 350,632 units, up from 320,129 units in 9MFY24.
Sonalika Tractors reported a 12 per cent increase in domestic tractor sales at 8,027 units when compared with 7,158 units. In contrast, Escorts Kubota experienced an 11 per cent decline in domestic tractor sales, dropping to 6,058 units from 6,782 units in January 2024.
Water reservoir levels saw a substantial surge, surpassing the 10-year average in the southern, western, and central regions. Additionally, the prevailing La Niña conditions are expected to further boost Rabi crop acreage, according to Raman Mittal, Joint Managing Director of International Tractors Ltd.
Total tractor production in January 2025 reached 92,768 units, the highest monthly figure in the past three months and significantly exceeding January 2024’s production of 74,895 units.
Strong monsoon
The tractor industry recorded a 14 per cent growth in Q3FY25 and a 5 per cent increase for 9MFY24. The expansion in the second half was largely driven by a strong monsoon. Manufacturers anticipate robust growth in Q4, with the industry projected to surpass earlier growth estimates for the fiscal year.
With positive momentum in the farm sector fueled by above-normal monsoons and favourable trade conditions for farmers, Mahindra has revised its FY25 growth forecast for the tractor industry to around 10 per cent, up from the earlier 6-7 per cent, expecting over 15 per cent growth in this quarter.
“Higher soil moisture from the above-normal southwest monsoon and strong water storage levels in key reservoirs have supported increased Rabi sowing. Continued government backing through rural schemes, agricultural subsidies… are positive indicators for tractor demand,” said Hemant Sikka, President, Farm Equipment Sector, Mahindra & Mahindra Ltd.
Tractor exports in January stood at 7,847 units, up from 7,185 units in January 2024 but slightly lower than 8,074 units in December 2024.