December 20, 2011
Farm tires: a bountiful year
While demand keeps everyone happy, tougher crops challenge manufacturers to come up with more durable tires
By: Bob Bissler
The USDA’s 2011 forecast of net farm income is the second highest inflation-adjusted value recorded since 1973.
It has been a good year to be a farmer. It also has been a good time to sell tires to them. According to the United States Department of Agriculture (USDA), net farm income is forecast to be up 31% at the end of 2011, to $103.6 billion, up $24.5 billion over 2010.
The USDA measures farm sector earnings in three areas: net farm income, net cash income and net value added. All three are forecast to rise more than 20% in 2011.
The USDA also projects net farm income and net cash income to exceed $100 billion for the first time.
“The farm tire market continues to be even more robust than 2010,” said Robyn Fisher Conrad, director of marketing at Michelin North America Inc. “The market tends to trend with farm net income, which is projected to be above 31% versus 2010.”
The USDA expects a 16% increase in sales of crop and livestock at U.S. farm operations in 2011. That projection includes gains spread out among many different categories.
“I can tell you that 2011 has been a strong year for agriculture,” said Andrea Masella, marketing manager Agricultural & Forestry Tires, Trelleborg Wheel Systems Americas Inc. “At Trelleborg, so far we grew our volumes on rear radial replacement by about 80% versus 2009 YTD. This was also due to the introduction of new sizes strategic for the North America market place, and we consolidated our volumes on OE where we expect a small growth by the end of 2011.
On bias tires, our growth in units was above 13% in replacement and above 15% in OE.”
Masella said he believes the strength of 2011 will continue in 2012. He expects another strong year with consistent demand from OE customers, especially in the first quarter.
Feed the world
There’s a big reason farmers are in big demand — hungry people. In October of this year, the world’s seven-billionth (700,000,000,000) person was born.
The demand for efficient, productive farm operations is greater than ever.
“The world population is growing and so will the demand for agricultural products and the price of those,” said Masella. “We are now moving to a complete new agriculture, run by professionals, using professional tools and machinery to achieve these new challenges. The average horsepower of agricultural machinery will keep growing in the future.”
As the numbers continue to roll in for 2011, the farm report continues to look very positive. There are two big reasons farm income has gone up this year — an excellent growing season and high crop yields at harvest time.
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