A majority of companies in the Irish machinery sector have been unaffected by the COVID-19 pandemic, with almost half saying their business has actually improved during the coronavirus outbreak.

Nearly 60% of businesses in the sector, however, said they had been negatively affected by Brexit.

Mayo-based Genfitt, wholesale distributor of farm machinery parts and spares in Ireland, has issued the 2021 edition of its annual Knowledge Report.

Companies surveyed include businesses in agri trading (52%), farm machinery dealers (26%) and machinery manufacturers (22%). Fifty-six per cent of businesses surveyed have one to five employees (15% have over 20 employees), while 73% of the firms have been trading for over 20 years.

The majority of participants rated the 2021 market as very positive, with 54% scoring it at seven or eight out of 10. The report notes this is a higher score than last year, despite the pandemic.

A total of 44% of respondents reported business performance above last year, as opposed to 36% in 2020 (compared to 2019). Forty-two per cent reported their business experiencing the same performance compared to last year, as opposed to 35% in 2020 (compared to 2019). This shows that the overall trend is upwards year on year, despite COVID-19.

From positive to negative, how has Covid impacted your business in 2021?

COVID

Nearly half (47%) of the survey respondents stated that COVID-19 had a positive/very positive impact on their business. By contrast, 22% indicated that the effects were negative/very negative. While not everyone is thriving, the report outlined that it was encouraging to see the majority have not been negatively affected.

Despite pandemic restrictions, e-commerce is still a small channel for sales in the sector. Nearly 20% of respondents stated that less than 10% of their trade is through e-commerce, while 73% stated that the question is not applicable, indicating that the technology may not have been adopted at all.

What % of sales are completed through your e-commerce channel?

Non-COVID factors

The main non-COVID factors impacting businesses were changing legislation, Brexit and price increases. One of the biggest challenges was trade with the UK – getting stock, delays in getting stock and increased restrictions and admin around the movement of goods.

Nearly 60% of businesses stated that they have been affected by Brexit.

Increased costs, more paperwork, poor stock availability and general uncertainty were the most consistent feedback.

Manufacturing

The report noted that order books for new machines are very strong, especially for tractors. The report puts supply issues down to suppliers not putting in big enough orders, which is causing issues as they can’t get the goods and there’s a squeeze on components too. The report points out that there’s a consensus that the combination of improved incomes and a shortage of quality secondhand tractors is boosting the market for new tractors.

The future

When asked how do they rate the future for the farming sector in 2022, 47% rated the market at six and seven out of 10. This indicates a positive trend, especially off the back of COVID and Brexit, and is higher than that in both 2019 and 2020.

When asked about the future of their own individual businesses, overall, it was consistent with marketplace predictions. A total of 41% of individuals marked their businesses at an average of between six and seven out of 10.

Looking ahead to the coming year, respondents had mixed views on whether or not legislation for dealing with the UK would ease, while the question was posed whether prices increase across the sector will dampen a post-COVID recovery. Overall, the prediction was that 2022 will either be the same or slightly down on 2021, with respondents not expecting a bad year.

Despite the impact of COVID and concerns about the impact of Brexit, the report surmises that the overall state of the Agri market in Ireland is positive. It adds that this year has been a slightly more positive year than 2020, with nearly half of respondents saying COVID had a positive impact on their business.