Wild escalations in demand over the past couple of years, difficult to predict steel pricing, and changing ordering patterns, are putting great pressure on manufacturers.

"If the proposed RHS increase for June comes through, it will represent a 39pc increase over five months," Mr Gason said.

"We've had periods of rising steel prices in the past but nothing like this."

Mr Gason is managing director of Ararat based A.F. Gason Pty Ltd, manufacturers of tillage and planting equipment.

"Machinery sales across Australia fell in mid-2004 when grain prices plummeted," he said.

"Last year we saw interest increasing in line with rising prices and then sales really jumped as the 2007 crop came off.

"Stock on the grass quickly sold and lead times have now gone right out.

"Suddenly order books are full to overflowing and we are chasing staff and desperately trying to keep up with demand.

"Getting our suppliers to ramp up quickly is also a problem.

"But the really big challenge is pricing, and it's a challenge for manufacturers all over the world.

"How do you factor these increases into your product range?

"It's not just steel and castings – all components are going up at an alarming rate."

With grain prices predicted to remain high for a number of years, Mr Gason believes long lead times for machinery is something farmers will have to get used to.

"Normally farmers like to be confident of a crop before making major capital investments," he said.

"I don't think that's going to be possible for the next few years if they want to be sure of having reliable equipment available for planting."