' /> Machinery Pete | AGWEB.com

Sep 16, 2014
Home| Tools| Events| Blogs| Discussions Sign UpLogin

July 2014 Archive for Machinery Pete

RSS By: Greg Peterson, AgWeb.com

Learn how to better manage your machinery investments from Greg Peterson, a.k.a. "Machinery Pete." He's been researching and analyzing machinery auction prices for more than 20 years.

The Story Behind 3 Low Hour IHC Tractors

Jul 29, 2014

IHCtractors 3 SteffesGroup8 14 14 

(3) low hour IHC tractors coming up for sale on an August 14th auction in central Minnesota. From right to left in the pic: 1976 IHC 886 with 2,150 hours; 1979 IHC 1086 with 2,694 hours and a 1982 IHC 5288 with 4,366 hours.

"Pete, what's the story on those low hour tractors coming up for sale?"

It's a natural impluse. We see tractors like the (3) IHC models pictured above coming up for sale at auction, notice the very low hours and think to ourselves..."Hmm, wonder what the scoop is, why the very low hours?" For lot of folks (most?) the default response is scepticism, which is a healthy thing. I've always advised potential buyers to make a ton of phone calls, talk to the sellers and the auction firm, ask lots of questions, get 'em talking...you'll get gut level responses to what you're hearing.

I've always loved to find out the "stories" behind the tractors.

And as I've learned from nearly 25 years covering auctions all over North America, there are often some very interesting reasons that 10, 20, 30+ year old tractors have very low number of hours on them. The (3) IHC tractors pictured above are a good example.

Auctioneer Eric Gabrielson with the Steffes Group (www.steffesgroup.com) gave me a rundown on the unique history of these IHC beauties: "These tractors were purhcased new, except the 5288, near Evansville, MN and have not been in use since renting out the land in 2003. The family told us they were started and moved yearly. They say the hours are actual."

"The family owns 400 acres of beautiful farmland in the Evansville area. They started a large automotive repair show in Minneapolis in 1932. They would come out to the farm to get away from the city life and hobby farm. I've known about the equipment for years as they are old family friends. They didn't want anyone near the old farm places as they are seasonal homes, so we hauled the entire farm line to Litchfield (MN) for our August 14th auction." Link to sale bill: www.steffesgroup.com

So the (3) IHC tractors not in use for 11 years and the farm operation was just a hobby farm type and encompassed only 400 acres for a family looking to get away from the big city. Interesting story indeed.

Here are closer up pics of the (3) IHC tractors:

1976 IHC 886 with 2,150 hours

IHC886 Steffes MN


1979 IHC 1086 with 2,694 hours

IHC1086 Steffes MN


1982 IHC 5288 with 4,366 hours

IHC5288 Steffes MN

I will of course be reporting on what these (3) tractors sell for on the August 14, 2014 auction in Litchfield, MN, along with all the other equipment on that sale. Should be very interesting.






Record Prices on South Dakota Farm Auction Yesterday

Jul 25, 2014

IHC1066 SD  19500 WestendorfWL42  7K 

The price of corn may be down, but auction sale prices on good used equipment in livestock country are red hot. Proof came yesterday (July 24, 2014) on a farm auction in southeast South Dakota.

Proof? How about the 1976 IHC 1066 tractor with 6,400 hours pictured above sold for $19,500. That is with NO loader by the way. The Westendorf WL-42 sold separate for $7,000. I'm not sure which sale price garners the bigger "WOW" there...$19,500 is the 4th highest auction sale price I've seen on any IHC 1066 over the past 18+ years.

$7,000 is a new record high auction sale price on the Westendorf WL-42 loader. The next highest price I've ever seen is $6,300 back on a June 12, 2010 farm auction in northeast Nebraska.

Here are a few more sale price highlights from yesterday's southeast South Dakota farm auction by my friends at Westra Atkins Land & Auction, LLC:

1997 CaseIH 8940 with 2,675 hours, sold: $92,000 (ties record high auction price)

CaseIH8940 SD  92K


1990 CaseIH 7120 2WD with 3,900 hours, sold: $52,000  (3rd highest price last 17 years)

CaseIH7120 SD  52K


Knight 1140 manure spreader, sold: $17,250  (owner paid $10K for it 2-3 years ago)

Knight1140 SD  17250


IHC 105 grinder mixer, sold: $1,700  (new record high auction price)

IHC105 SD  1700


IHC 720 5-18 plow, sold: $3,500  (highest price on 5 bottom 720 in 18 years)

IHC720 SD  3500





No. of Farm Retirement Auctions Going Up

Jul 22, 2014

AuctionBiddingIA 6 13 

He wasn't kidding.

One of my long-time auctioneer friends, Gene Ryerson with Ryerson Auction & Realty, Ltd. (www.ryersonauctionrealtyltd.com), when he told me 3 weeks ago that he was beginning to get an increasing number of phone calls and inquiries from farmers looking at and thinking about having their farm retirement auction and selling off their machinery lines.

A quick look at Ryerson Auction's web site and I found six farm machinery retirement auctions coming next month. Ryerson Auction will have retirement auctions on August 1st, 4th, 7th, 14th, 20th and 26th. 

What's been happening of late here with commodity prices again? Oh yeah, falling.

Where is Ryerson Auction & Realty located? North-central Iowa...big-time grain country.

Six farm retirement machinery auctions in one little area of north-central Iowa next month is quite amazing given the extended LONG period of historically low No. of machinery auctions we've had for the past 7 years now. At our Machinerypete.com firm we not only have been tracking auction sale price on all types of machinery for nearly 25 years now, we've also been keeping tabs on the No. of machinery auctions taking place throughout North America. Check out the facts:


Chew on these figures for a moment. 63.8% fewer No. of farm machinery auctions the first 6 months of 2013 vs. the same period back in 2002. See how dramatically the No. of machinery auctions fell beginning in 2007. What happened in 2007? Commodity prices surged higher. Why quit when times are good? Exactly.

So why is the No. of machinery auctions so important. Because the No. of auctions, or lack thereof, has been one of my six key factors working in tandem to drive very strong used farm equipment values the past seven years. Here's my list of 6 key factors:

6Factors UsedValues

For four solid years now folks of all manner have been asking me one question: "Pete, when will the bubble burst with these very HIGH used farm equipment values?" My answer was always, when at least 2 of my 6 key factors begin to flip, that's when we'll begin to see recalibrating used equipment values. So now my key factor No. 4 "Low No. of machinery auctions" is beginning to change with all the auctions coming in August. Factor No. 1....if you are a grain farmer, definitely more profit challenged days are here. So that's two changing/flipping factors right there and of course currently a very high level of uncertainly regarding my Factor No. 6....IRS Sec. 179 business asset write off limits. Will Washington act to bump up the write off $$ limits here late in 2014? If so, how much? What if they don't?

Now of course if you are a livestock or dairy farmer, 2014 has produced much more favorable profit conditions and as such, I've been tracking rising auction sale prices on good used hay & forage equipment, skid steers and mid to smaller HP size used tractors. 

But if you are an older grain farmer, in north-central Iowa and beyond, more folks looking at and thinking about maybe time to sell. Late July into August also beginning to show a ramp up in the No. of large regional dealer inventory reduction auctions, the type of sales that can easily see 20+ later model used tractors and combines up for sale.

...what's going to happen with used equipment values? Stay tuned.





JD 4440 Tractor Values Up 11.5% in 2014

Jul 11, 2014

 JD4440 SK  35K

Older, but worth more money.

That's the scoop on John Deere 4440 tractor values through the first half of 2014. The iconic tractor model made by Deere from 1978-1982 is up an impressive 11.5% in value so far this year over 2013 values, despite now being 32-36 years old. Compared to 10 years in 2004, 4440 values are up 15.2% in value. Check out the data yourself below in a table showing the Ave. Auction Sale Price on John Deere 4440's over the past 18 years:

Calendar Year Ave. Auction Price High Price Low Price
2014 $22,502 $35,000 $12,000
2013 $20,190 $47,500 $6,900
2012 $17,930 $42,000 $8,500
2011 $20,480 $37,000 $9,000
2010 $19,847 $34,000 $9,500
2009 $21,475 $58,000 $6,500
2008 $20,906 $36,000 $11,100
2007 $19,576 $32,000 $9,000
2006 $20,609 $37,000 $10,000
2005 $19,181 $40,400 $6,000
2004 $19,536 $41,400 $10,600
2003 $17,456 $25,300 $500
2002 $18,209 $29,000 $8,750
2001 $18,842 $30,000 $11,600
2000 $19,500 $28,250 $11,000
1999 $19,716 $34,250 $11,300
1998 $20,601 $37,000 $13,600
1997 $21,894 $36,500 $14,500
1996 $22,567 $37,000 $14,300

* Data by www.machinerypete.com

So why are auction sale prices rising on a 30+ year old used tractor model even as commodity price levels have softened here in 2014 vs. prior years? Well. couple factors at work here I think:

1. No. of farm machinery auctions at historic low levels. Compared to 10 years ago in 2004, our data shows a staggering 53.2% drop in the No. of machinery auctions...so we're coming off an extended strong period for farm profits, folks have money and now 53.2% fewer machinery auctions taking place. More money chasing fewer nice 4440's = rising values.

2. Buyers placing increasing value on acquiring older/simpler models. "Pete, I like that I don't have to hook it up to a laptop to fix it." If I had a nickel for every time I've heard that sentiment echoed over the past few years....let's just say I'd have myself a big bag full of nickels. Late model modern tractors, combines, sparyers and planters do amazing things with computers, GPS and all manor of technology. All great....but there is definitely something to be said for the simpler, the familar, what we're used to, what we have a history with. So when the really nice John Deere 4440's show up for sale at auction now, anywhere....tons of buyer interest, which can result in things like this 1981 JD 4440 (pictured below) with 4,552 hours selling for $47,500 on a January 19,2013 farm auction in northeast Iowa:

JD4440 IA  47500

3. The start of buying nice 4440's as collector items? I know, sounds totally weird, but I think its' true. I've been writing, talking and blogging a lot the past couple years about what I call "The New Collector Tractor"...rising auction sale prices on nice original or restored tractor models from the mid 1960's - mid 1970's. Well, it feels to me like this trend now may be stretching out to encompass classic well loved tractor models from the late 1970's into the early 1980's...so bingo on John Deere 4440's.

Here is a Youtube video I just posted this morning with a closer look at rising values on John Deere 4440 tractors this year, highlighting (5) very nice ones sold around the country + video I shot of a nice 1981 model 4440 with 4,160 hours selling on a June 19, 2014 farm auction in north-central Iowa:





Recap of Recent Notable Tractor Sale Prices

Jul 07, 2014

 Recently, I covered a farm retirement auction in north-central Iowa where a nice 2008 John Deere 8430 MFWD tractor with 1476 hours sold for $170,000. How does that compare to what other 8430s have been selling for? See for yourself with data straight from the MachineryPete.com database:

$149,000: 2009 model, 2,296 hours, April 3, 2014, northeast Indian
$154,000: 2009 model, 2,000 hours, March 15, 2014, west-central Michigan
$148,000: 2006 model, 3,639 hours, February 7, 2013, northeast Indiana
$155,000: 2006 model, 2,870 hours, January 11, 2013, northwest Indiana
$140,000: 2007 model, 1,444 hours, December 3, 2013, northeast Missouri
$158,100: 2008 model, 2,927 hours, February 18, 2013, west-central Minnesota
$106,000: 2009 model, 5,500 hours, April 10, 2013, northeast Texas
$189,000: 2009 model, 675 hours, March 5, 2013, north-central Iowa
$199,500: 2009 model, 1,150 hours, November 18, 2013, south-central Kansas
$130,500: sold Jan. 1, 2013, northeast Mississippi
$135,500: 1,809 hours, February 7, 2013, northeast Indiana
$174,500: 1,302 hours, January 17, 2013, east-central Nebraska


Here's YouTube video I shot of the John Deere 8430 selling on the June 26, 2014 farm retirement auction in north-central Iowa: 

And just for fun, here’s a record sale on an Allis Chalmers D21 tractor! Here's the YouTube video I shot on June 28th at the collector auction in Bedford, Iowa:


Insights on Combine Values, Section 179 and Illinois Auction Highlights

Jul 01, 2014

 There was a nice farm auction on Thursday, June 19, in east-central Illinois. Here’s a couple sale price highlights:

·  2009 John Deere 9670 STS combine, 1236 engine hrs: $164,000

·  2009 John Deere 7830 tractor, 2010 hours: $105,000

·  1992 John Deere 4455 2WD tractor, 7631 hours: $31,500

That’s a pretty strong price of $164,000 on the 2009 John Deere 9670 STS combine. For comparison sake, on a June 4 consignment auction in southeast South Dakota a very similar machine, a 2009 model 9670 STS with 1278 engine hours in good condition sold for $150,000. Looking at the auction sale price data in our "auction results" database on www.machinerypete.com, it shows that overall values have solidified on John Deere 9670s this year. Here's the scoop:

·  Average auction price this year: $150,444

·  Average auction price in 2013: $146,730

·  Average auction price two years ago: $153,292

·  Average auction price three years ago: $178,682

Note the large average sale price drop from 2011 to 2012 ($178,682 down to $153,292). Not surprisingly we saw a surge in the number of 9670s sold in 2012, so there’s supply and demand at work in a big way.

So far in 2014, nearly half way through the year, I've seen just slightly fewer 9670s sold at auction v. 2013. Of course, there are still a ton of nice later model used combines sitting on dealer lots all over the U.S., which is a continuing issue to work down this inventory level. It could be that we'll see a surge of late model used combines hit the auction market here soon.

One angle I'm keeping tabs on is on the tax front, our old friend IRS Sec. 179. In June, the House of Representatives passed a tax/business bill that included a provision to bump back up the Sec. 179 immediate write off limit for any business asset purchase (new or used farm equipment included) to $500,000 for 2014. And that bill works to make this permanent. Wow, that would be something, wouldn't it? Of course the bill still must pass the Senate and be signed by the President, but I think definitely a general "feeling/hope/belief" out there in farm country that something will get done on this front by the end of the year.

For large dealer groups with multiple stores sitting on a high level of late model used combines (and 200 HP+ tractors and four-wheel-drive tractors) that potential development with Sec. 179 write off limits made higher and permanent would be very welcome news. So it’s possible that some dealer groups maybe deciding to hold off on their inventory reduction auctions this summer and wait for more positive sale conditions later this year. But it’s always risky to wait. And it’s always risky to count on Washington to get things done. This all means that it should be an interesting rest of the 2014. Stay tuned.


Log In or Sign Up to comment


The Home Page of Agriculture
© 2014 Farm Journal, Inc. All Rights Reserved|Web site design and development by AmericanEagle.com|Site Map|Privacy Policy|Terms & Conditions