The used farm equipment market is experiencing significant shifts in 2024, with several key trends emerging that affect both buyers and sellers. Understanding these trends is crucial for those looking to navigate the current marketplace effectively.
Declining Auction Prices
Auction prices for used farm equipment have been on a downward trend across most categories[1][4]. This decline is particularly noticeable in:
- Tractors over 300 horsepower: Down 6.4% year-over-year
- Tractors in the 175-299 horsepower range: Down 7.6% year-over-year
- Tractors in the 100-174 horsepower range: Down 3.6% year-over-year[1]
This trend suggests that buyers may find better deals at auctions, while sellers might need to adjust their expectations.
Growing Gap Between Auction and Asking Prices
One of the most significant trends is the widening spread between auction values and asking prices[4]. This gap has reached historic levels in some equipment categories:
- High-horsepower tractors: 48% spread
- Combines: 57% spread
- Self-propelled sprayers: 52% spread
- Planters: 68% spread[4]
This disparity indicates that dealers are often slow to adjust their asking prices in response to falling auction values, creating potential negotiation opportunities for buyers.
Inventory Build-Up
Used farm equipment inventory levels are generally increasing across various categories:
- Tractors 100 horsepower and greater: Up 37.09% year-over-year
- High-horsepower tractors (300 HP and greater): Up 62.48% year-over-year
- Combines: Up 10.44% year-over-year
- Self-propelled sprayers: Up 38.39% year-over-year[4]
This inventory build-up is putting downward pressure on prices, especially in the auction market[2].
Category-Specific Trends
Different types of equipment are experiencing varied trends:
- Combines: Asking values are trending downward but still up 3.83% year-over-year
- Planters: Asking values are trending sideways, down 6.84% year-over-year
- Self-propelled sprayers: Asking values trending down, with a slight 0.6% month-over-month increase but a 0.67% year-over-year decrease[4]
### Factors Influencing the Market
Several factors are contributing to these pricing trends:
1. Lower commodity prices affecting farmer purchasing power
2. High interest rates impacting financing costs
3. Increased availability of new equipment easing supply chain pressures
4. Dealers attempting to balance inventory levels and carrying costs[2][3]
Outlook for Buyers and Sellers
For buyers, the current market presents opportunities to find good deals, especially at auctions. However, they should be prepared for potentially longer search times to find specific equipment.
Sellers, particularly dealers, may need to reassess their pricing strategies and consider more aggressive pricing to move inventory. Private sellers might find it challenging to achieve prices seen in previous years, especially for older models.
As the market continues to evolve, staying informed about these trends will be crucial for making informed decisions in the used farm machinery market. Both buyers and sellers should closely monitor market conditions and be prepared to adjust their strategies accordingly.
Citations:
[1] https://www.farm-equipment.com/articles/22644-used-equipment-prices-continue-to-drop-with-inventories-building-up
[2] https://www.farmprogress.com/farming-equipment/high-use-equipment-inventory-pushes-prices-down
[3] https://www.agdirect.com/resources/learning-center/equipment-buying-trends
[4] https://www.prnewswire.com/news-releases/used-farm-equipment-market-faces-historic-volatility-as-auction-values-drop-faster-than-asking-prices-302239911.html
[5] https://www.sandhills.com/news/article/250042680
[6] https://www.agweb.com/lean-mean-selling-machine-essential-advice-selling-farm-equipment
[7] https://talk.newagtalk.com/forums/thread-view.asp?DisplayType=flat&setCookie=1&tid=575836
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