Rural distress dents India's tractor sales in September (updated)

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01/10/2026 06:36

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By Kashish Tandon and Aishwarya Jain
Oct 1 (Reuters) - India's weakest monsoon in over a decade dented rural spending in September and weighed on tractor sales, data showed on Thursday, while urban demand supported sales of passenger vehicles. 
The June-September monsoon, which delivers nearly 70% of India's annual rainfall, was 12.6% below normal this year, fuelling concerns over crop yields, rural demand and food inflation in Asia's No.3 economy.
Mahindra & Mahindra MAHM.NS, India's largest tractor maker, reported a 21% drop in tractor sales during the month, while smaller rival Escorts Kubota ESCO.NS posted a 16.7% decline.
     Performance was dented by a patchy monsoon and relatively lower monsoon crop sowing, Escorts Kubota said.
"Lower farm incomes and, as a result, rising rural indebtedness hurt purchasing power and demand for consumer goods and services, while supply shortages can push up food prices and stoke inflationary pressures," said Rohit Azad, an economics professor at Delhi's Jawaharlal Nehru University.
The slowdown mirrors a broader pullback in farm spending.
Last week, agriculture company Rallis India RALL.NS said farmers were reducing purchases of pesticides, fertilisers and seeds to conserve cash after the weak monsoon and poorer harvests.
     Kranthi Bathini, director of equity strategy at WealthMills Securities, highlighted how uneven rainfall and drought-like conditions in parts of India had hurt the agrarian economy.
"That weakness is visible in segments closely tied to rural demand, such as two-wheelers and tractors," Bathini said.
Bajaj Auto's BAJA.NS domestic two-wheeler sales also declined 12% in September.
The delayed start of the festive season further weighed on sales. Festivals begin in October this year, compared with September last year, when they boosted demand for vehicles and other big-ticket purchases.
Passenger vehicle sales, however, remained strong on urban demand. 
Hyundai Motor India HYUN.NS posted record monthly sales, while Maruti Suzuki MRTI.NS, Tata Motors Passenger Vehicle TAMO.NS and Mahindra & Mahindra reported double-digit growth.

 (Reporting by Saikeerthi and Aishwarya Jain in Bengaluru; Editing by Sherry Jacob-Phillips, Nivedita Bhattacharjee, Dhanya Skariachan and Harikrishnan Nair)
 ((Kashish.Tandon@thomsonreuters.com))