Tractor Industry In India May Remain Unhurt From Pandemic
With Indian Meteorological Department projecting a welcome southwest monsoon season during 2020, the agriculture industry has started showing a spike in trade. In a recent report CRISIL has projected tractor industry likely to be unhurt from Covid-19. Unlike rest of the automobile industry that is facing double digit drop in sales, tractor may still do well despite 37 per cent on-year decline combining April and May this year.
The IMD has forecast the south-west monsoon to be at 102 per cent of the long period average (LPA) in calendar 2020. Crucially, it sees rains well-distributed at 96-107 per cent of the LPA in all the four regions. The monsoon’s approach so far has been timely with rains 21 per cent above normal in June to date. The forecast for July and August – crucial months for kharif crop – is also encouraging at 103 per cent and 97 per cent, respectively, over LPA.
Earlier to this CRISIL expected a well-distributed and normal monsoon – as forecast by the Indian Meteorological Department (IMD) recently – to limit the impact of the Covid-19 pandemic on tractor sales volume this fiscal. CRISIL had also projected a possible one per cent drop on sales for tractor industry as compared to previous fiscal.
Although most of the farmer union leaders expect an impact on sales of tractors due to skyrocketing diesel prices. In the meantime India is going through an unlock phase and uncertainty in agriculture market has become very common sight.
