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HALF YEARLY
MARKET TRENDS REPORT
AUSTRALIA
Mid-2022 results across all industries indicate a continuation of the strong market demand for used equipment enjoyed throughout 2021, and a conservatively positive outlook for the remainder of 2022 and into 2023.
Global OEM supply issues remain the key driver of demand for used equipment across all sectors, increasing prices across the world, and motivating operators to look outside the normal supply chain for equipment solutions. This has led to increasing interest in used equipment auctions, driving a rise in bidder registrations of 47.11% for HY22. With no respite in sight for the ongoing shortage of new equipment, we expect to see extended delays on new equipment stretching into 2024, due to long manufacturing lead times and shipping backlogs.
The third wave of COVID is again disrupting industry with staff shortages due to illness compounding the delays caused by already stretched supply chains. Added to this, over the past six months our industry has been negatively impacted by significant increases in the price of fuel, ongoing high pricing of steel and components, delays in availability of raw materials and increased shipping costs. This is due to a disrupted global environment impacted by the war in Ukraine, trade uncertainty with China, high inflation and escalation of interest rates.
All of these factors contribute to an increasing cost base for operators, which is causing financial distress for marginal businesses and driving up costs for buyers.Ritchie Bros. has observed a marked increase in complete dispersals as operators are choosing to bring forward business retirement to capitalise on high used equipment prices. While the tsunami of insolvencies forecast 18 months ago has not eventuated, the Australian Tax Office has recommenced enforcement actions and Director Penalty Notices, so it is expected that insolvencies in all sectors will gradually increase to pre-COVID levels by Q1 2023.
Results for the three sectors featured in this report for the HY22 indicate that record demand for used equipment is still on the rise.Sales of used construction equipment increased 10.17% from the same period in 2021, despite the collapse of a number of building firms and the industry being challenged by a significant undersupply of both skilled and unskilled tradespeople and professionals, and rising costs of raw materials. The sector is buoyed by the Australian Government’s 10-year commitment to infrastructure investment and the Instant Asset Write Off Scheme increasing spending.
The transport used machinery market continues to thrive (up 51.51% from HY21), in the face of driver shortages, the high cost of fuel and resumption of air freight services to near pre-pandemic capacity. This trend is largely due to the lifting of remaining border lockdowns and increased demand for online shopping.Following the trend from 2021, capital expenditure on both new and used large equipment is surging in the agriculture sector. Ritchie Bros. observed an increase in used equipment sales of 156.97% for HY22, again stimulated through scarcity of new equipment. This sector continues to be negatively impacted by global shipping container shortages, rising freight costs and supply chain constraints.
It is anticipated that the used large machinery market across the construction, transport and agriculture sectors will continue to absorb inventory as soon as it becomes available, with higher than expected value to be achieved on used assets for the remainder of 2022.
2022
HALF YEARLY
MARKET TRENDS REPORT
AUSTRALIA
DOWNLOAD THE REPORT
Download our Half Yearly Market Trends Report 2022 and gain insight into the Australian used equipment market.
2022
Download Report
