Layoffs in the agriculture equipment industry are not isolated to one company, says the general manager of the industry’s umbrella group.
“It’s a phenomenon that is affecting primarily people involved in manufacturing large ticket items,” said Larry Schneider of the Prairie Implement Manufacturers Association in Regina.
Layoffs in the industry are isolated mainly to companies that produce large machinery like air seeders, combines or tractors.
Flexi-Coil recently announced it will be cutting back half its staff for four months, but it is not alone.
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Other Saskatchewan companies that rely on good farm crops and prices have also laid off staff. Bourgault Industries of St. Brieux has laid off about 300 of its 900 employees. Officials did not return phone calls.
Harmon International Industries Inc. of Saskatoon has also reduced staff.
Morris Industries Ltd. of Saskatoon stopped production for two months as a way of reducing costs. But during that time it spent more than $2 million upgrading the plants, said Steve Russell, director of marketing and sales.
Downturns in Canadian agriculture are not new, said Russell, and Morris has diversified sales around the world.
“The secret is to remain flexible. We want to look as far forward as possible,” he said.
The problems revolve around low prices in the agriculture industry, said Schneider. It began with a mild winter and a dry spring. Farmers were not optimistic a bumper crop was coming.
“Farmers are not spending a lot of money after putting in the crop,” he said.
In addition, low world grain prices and predicted large stockpiles have also held prices low.
But farmers are still buying smaller machinery, or specialized agriculture equipment.
Leon Malinowski, president of Leon-Ram Enterprises Inc. in Yorkton, Sask., said despite the low farm prices his company has had a good year.
“We’re very, very busy,” said Malinowski, whose farm machinery company specializes in loading equipment and dozer blades, often used in the livestock industry.
“We’re very, very pleased with the fact that we’re very, very busy.”
Gavin Semple, president of Brandt Industries Ltd. of Regina, said there is a definite “softening” of the agriculture industry, but this year’s sales are par with 1997’s record levels.
Semple points to two reasons for his company’s good sales: An increase of exports to the United States and offshore and the introduction of new products.
Sales of a new grain vac are doing well and a new heavy harrow shows plenty of promise. Brandt recently hired more staff and has moved into a larger plant, he said.
Ward Krywalt, general manager of New Noble Distributors Inc., said his business has yet to decide how the slowdown in the agricultural economy will affect it, especially with its production of specialized air seeding equipment.
It will continue to check the number of air seeders on dealer lots this fall and adjust its fall production run.
