Clearing a slight confusion about tractor imports into South Africa

• 05 May 2025
• 0 Comments
• Agbiz
• Wandile Sihlobo

In addition to better seed cultivars and genetics, South Africa's prosperous agricultural sector has benefited from mechanisation to improve efficiency. The country imports a range of agricultural machinery, which we see under various brands.

During the current trade wars, there has been confusion about how much South Africa levies in tariffs on agricultural machinery imported into the country, specifically tractors. It is essential to clarify that South Africa has no duties on imported tractors – check under Harmonised System (HS) code “8701.9” in the tariff book for greater details.

We can't place import duties on essential equipment we don't produce. Importantly, we want this equipment to be affordable so that the farming sector can continue to thrive.

Beyond these import confusions, South African agricultural machinery sales continue to show signs of recovery from last year's modest sales. For example, tractor sales increased for the third consecutive month, up 35% year-on-year in March 2025, with 671 units sold. The combine harvesters' sales were up 42% year-on-year in March, with 37 units sold.

The substantial increase in sales primarily reflects the sector's positive sentiment about the 2024-25 first crop and horticulture harvest, based on favourable weather conditions and the base effects, given the weak sales in 2024.

As we recently stated, the poor agricultural machinery sales performance in 2024 resulted from various factors. First, South Africa's agricultural sector had higher machinery sales between 2020 and 2023. Improved farmers' incomes supported higher sales due to an ample harvest and higher commodity prices. Thus, there was bound to be some correction, leading to a moderation in sales in 2024.

Second, after a few good agricultural years, we struggled with a mid-summer drought in the 2023-24 season, weighing on farmers' fortunes and worsening sales performance. Farmers were under financial pressure because of the crop losses. For example, the 2023-24 mid-summer drought has led to a 23% decline in South Africa's summer grains and oilseed production to 15,53 million tonnes. Lastly, the relatively higher interest rates for much of 2024 added to the financial pressures in the sector.

In 2025, interest rates have eased somewhat from last year's levels. The favourable agricultural production conditions indicate a rebound in the field crop, horticultural harvest, and other subsectors. These dynamics will likely continue to support the sales of tractors and combine harvesters in 2025, especially if we consider that some farmers may start with machinery replacement.

Email: wandile@agbiz.co.za

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