Ag Tire Sales in 2020: Manufacturers are Cautiously Optimistic
"If one hasn’t the necessary knowledge and ambition to succeed in farming, there is no disgrace in moving to town to study law or medicine.” Farm & Ranch, 1912
Early indications are the upcoming winter weather for much of the U.S. will be harsh. And the Farmers’ Almanac agrees.
“Our extended forecast is calling for yet another freezing, frigid and frosty winter for two-thirds of the country,” said Peter Geiger, editor of the Farmers’ Almanac. More specifically, the 201-year-old publication predicts the worst “of the bitterly cold winter conditions will affect areas east of the Rockies all the way to the Appalachians.”
When asked what the replacement farm tire market would be like in 2020, ag tire manufacturers and marketers contacted by Modern Tire Dealer cited a number of factors that could affect demand.
“It depends on the weather,” says Doug Kershaw, vice president of BKT USA Inc. “If we have what Farmers’ Almanac and other sources predict – a harsh winter – then planting will be slow. So it could be a tough year. A lot of the farm equipment is still in inventory, so there will be creative financing.”
Minoo Mehta, president of BKT USA, says government policies will be the biggest factor affecting the ag tire market. “Why? Because China is the biggest customer of the U.S. market. When there are trade wars, the ag market gets hit the hardest.”
“We feel the replacement market will be strong in 2020,” says Scooter Kramer, demand planning manager, commercial ag, for Bridgestone Americas Inc. “2019 was adversely affected by trade but, we believe, more so by the weather in the Midwest.
“While we don’t feel any trade deal will be finalized before the election, we feel, barring any weather effects, 2020 will be strong compared to 2019.”
Continental Tire the Americas LLC also is cautiously optimistic.
“Based on our market research, we estimate that the rear radial/bias market could grow by roughly 2%,” says Dana Berger, Continental’s OE commercial specialty tire sales and ag business development manager for the U.S. and Canada. “The small farm tire replacement sales may see a higher growth rate, around 4%.
“If we take year-to-date tractor sales into consideration, the U.S. market is above the five-year average for all segments. Therefore, assuming we have a better planting season than we did in 2019, the replacement market is likely going to either remain flat or see a single digit percentage growth.”
“I see the farm market rebounding in 2020 after a few tough years weather wise etc.,” says Jack Fenner, marketing manager for Specialty Tires of America Inc. “There should be some pent up demand.”
Despite 2019 net farm income trending slightly upward, most farm tire brands will be flat or slightly down in 2019 “due to unfortunate weather conditions and diminishing export sales,” says Bill Dashiell, senior vice president of the Commercial Tire Division for TBC Brands LLC. “We have noticed American farmers favor brands which can perform at a more affordable price point, such as (our) Harvest King.” ■