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Second Quarter Swoon

October 4, 2013
By: Greg Peterson, Machinery Pete
Combines MF2010

Now’s the time to buy

The value of used combines drops each year from late spring into early summer. I’ve seen the same pattern for the past five years.

combine values

From all-time highs in 2008/09, used combine values have been sliding lower since 2010’s second quarter. This slide is due to growing value "softness" on late-model used combines. There are lots of them on dealer lots as the turn time has slowed when dealers take them in on trade.

In the equipment biz, the name of the game is turning used inventory. After busy year-end fourth quarter sales and strong early first quarter new business, when late spring rolls around, dealers turn their attention to trimming used inventory levels. It’s time to sell. Hence, the annual April to June barrage of very large dealer, online and consignment auctions each year.

It’s time to buy. More big auctions featuring high levels of late-model used combines means softer prices.

On the other hand, since 2007, used combine values spike higher in the fourth quarter. We’ll likely see the same in 2013 as year-end tax-motivated buyers pile into the market, pushing up values on all types of used equipment.

Since 1989, Greg Peterson has compiled more than 500,000 auction prices, which he updates at www.machinerypete.com. Read his blog and watch auction videos at www.AgWeb.com/machinerypete. E-mail him at machinerypete@farmjournal.com.

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FEATURED IN: Top Producer - October 2013

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