Cotton Yields, Prices Propel Purchases of Cotton Equipment

January 31, 2017 08:55 AM

“I think southwest Oklahoma and the Texas Panhandle; moods are really high right now,” said Christian Herrera, of Western Equipment, an equipment dealer covering Oklahoma and Texas.

The blanket of white cotton this year is fabricating record yields for growers in Oklahoma and Texas. 

“We had a great cotton crop, we're looking to add a lot more acres,” said Herrera.

“I was told by the parts manager at Altus, Ok. that some of the guys were making 5-bale cotton,” said Andy Vloedman of Western Equipment. “I have never heard of anybody making 5-bale cotton, but there are a few doing that.”

Normal yields for this area is 3 to 3.5 bales per acre, and that’s for irrigated acres. Those high yields are even causing growers to second guess if their yield monitor was calibrated correctly. 

“We actually had some guys that called us back and said, ‘I don't think this is right,’” said Vloedman. “We went out and said, ‘Yes, it really is making this.’”

Rains were right on schedule and cotton prices found momentum, creating the perfect storm for growers fortunate enough to get the moisture. That helped spark new momentum for cotton pickers.

“Late 2016, early 2017, we started to see cotton picker prices; you can tell they're higher,” said Greg Peterson, host of Machinery Pete TV, to U.S. Farm Report host Tyne Morgan.

“We're seeing a lot of guys wanting to get new equipment and get out there and plant some more acres,” said Herrera.

Western Equipment says the demand is so high, they're pretty much sold out of new cotton picker balers, which is the opposite of where inventory was a year ago. It's more than just cotton equipment; the used market is also selling fast.  

“Used tractor prices, hay balers, incredibly strong values down there in northern Texas, Oklahoma, kind of showed up in 2016,” said Machinery Pete. “Whatever happens out there, if it's a market changes or the weather is in a good way for people, those items show up, and there's just more buyer interest.”

Since there was in imbalance between supply and demand, local dealers are trying to generate demand, while encouraging some to keep equipment for an extra year.

“We're trying to get the guys to hang onto them a little longer,” said Vloedman.  “Maintenance, and having programs in place and service programs in place.”

PrairieLand Partners covers much of Kansas, and they say with commodity prices, area farmers are interested in getting more life out of equipment. 

“There's definitely more interest in repairing what they have,” said Steve Kauffman, Director of Precision Equipment for PrairieLand Partners. “You know optimizing their used equipment and maybe staying with it for another year.”

“It is all about uptime,” said Brian Payne of John Deere. “That is one of the most important things that drives our customers. When it's planting season, spraying season, harvest season, they cannot afford down time, and uptime is the big driver.”

Planting may be a few months away for some farmers, but dealers say preparation for a smooth season should start now. 

“They trust the mechanics, they trust our shops, and they feel like we can rebuild the machine and get it back to useable condition, add more life to that machine, and as they maybe decide not to trade machines or buy new, they're going to have to rebuild the machines,” said Brian Koehn, Corporate Parts Manager, PrairieLand Partners.

The decision to hold or buy isn't an easy one for growers, but dealers say if you're trying to get more years out of what you have, making sure each piece of used machine is running on all cylinders should be a priority to kick off 2017.

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