By now many US companies will have released their second quarter (Q2) earnings results. These include agricultural and sportsturf machinery companies. Some have already reported their Q2 figures back in May, such as John Deere, while The Toro Company reported their earnings in early June. CNH Industrial is due to announce its Q2 results this Friday (29th July). The earnings results were a mixed bag with some companies showing an improvement over the same period in 2021. Those that saw a decrease in earnings gave economic and political reasons for this. “The decrease was largely driven by higher material, freight and manufacturing costs . . ” would be familiar lines in their reports.
I don’t want to dwell too much on financials in my blog this week, but I couldn’t help but notice how the US dollar has strengthened against the euro. Last week saw both currencies on a par with each other. That was the first time this happened in twenty years. What effect will this have for dealers? Any machines sold in Ireland that are imported from the US are now more expensive to purchase. To put it into perspective, in May of last year €1 was worth $1.22. That is a 22% price swing. This cost increase may need to be passed on to customers. When you add this to the fuel, transport, and fertiliser price increases, it could affect sales.
Last Thursday the European Central Bank increased its interest rate by 0.5%. This was the first interest rate hike in eleven years. This will make taking out a business loan more expensive.
Looking on the bright side, real life show season is back with us once again, after a two year gap. The FTMTA held a successful trade show in Punchestown on the 13th and 14th of July last. It was their first live show since 2019 with thousands attending. People were able to meet up once again, Exhibitors were delighted to showcase their range of machines and see people try out their equipment, for real. New tractor models were on display but what caught many people’s attention was the new 100% methane-powered tractor from New Holland, which, according to Liam Hayde, New Holland’s area sales manager for Ireland, is the first of its kind in the world. The tractor is a modified version of the T6 180. Could this be the trend for the future? It certainly is a step in the right direction. Many questions were asked about this type of fuel from the visitors such as: How is it stored? How is it made? Where can it be bought? Will it be expensive? Is it readily available?
Another show that took place was the GLAS exhibition at the National Basketball Arena in Dublin. This took place last Thursday (21st July). Admission was for trade only and free for practitioners in the horticulture, sportsturf, grounds maintenance and related sectors. The theme of the show was ‘Your industry. Your event”. Key topics included, the changing face of retail and ecommerce, green city initiatives, smart technology, career development, upskilling and more.
One of the biggest events to look forward to this year is the National and World Ploughing Championships. This will take place at Ratheniska, Co Laois from September 20th - 22nd. Many dealers and distributors will be exhibiting at the show. Let’s hope for fine weather.
