Machinery Pete: Equipment Warranties Add Resale Value

May 22, 2017 02:58 PM

Weathering Mother Nature in the Texas Panhandle can be area farmers' biggest obstacle.

“In early May, we had 8 inches of snow on the ground, and a week later we're planting,” said Miles Frische, a farmer from Dumas, Texas. “It's amazing.”

This year, the weather is having the opposite outcome from recent years. With more moisture, today these farmers aren't plagued by drought.

“We’re in good shape,” said Frische.

The latest drought monitor shows the Texas and Oklahoma panhandles aren’t plagued by dryness for the first time in nearly a decade. It's that moisture that's made planting a challenge at times this year, but with bigger machines, these farmers can play catch-up in just a matter of days.

“With all of our planters in the field, in one day we could probably cover 2,500 hundred acres,” he said.

This year, moisture may be plentiful, but some of the staple crops are taking a backseat, as crop mixes are changing.

“Cotton is king right now,” said Frische.

With old crop cotton trading above 80 cents, the Howards, who farm outside Hartley, Texas, are insuring the crop gets off to a strong start.

“Getting the cotton in by the 10th of May is our main priority,” said Mark Howard.

“Once upon a time you'd think we wouldn't have cotton up here because it's so cold, but genetics have come to us, so cotton is very viable here,” said Frische. “It does very well.”

For Green Country Equipment, the dealership services more than just cotton acres in this diverse part of Texas. From livestock to crops, there is a wide focus, but it’s the talk of cotton acreage doubling in this area that’s helping the resurgence in equipment sales. 

“I would say sprayers have been our biggest surprise,” said Seth Gustin, general manager of Green Country Equipment. “We're pretty clean on our sprayer inventory. We're actually buying a few sprayers right now. It's still a result of the cotton crop, because cotton has to be sprayed so often.”

Machinery Pete says sales of sprayers continue to impress him, but it's a similar story with quality machines.

“Good used equipment has been in demand since end of 2016, and I’ve been surprised at some of the prices we've been seeing on late model large stuff,” said Greg Peterson, Host of Machinery Pete TV.

He says one factor becoming an even more important factor to buyers is warranties.

“On the sale bills, it used to be mentioned kind of at the end on an item, a one-or two-year-old tractor combine, 'Oh, we've got a warranty,’” said Machinery Pete. “Now, you put that up front, and as sales of new have been slower, to get that piece of used equipment with a warranty for another year or two is huge.”

“With our customers anymore, it's almost a deal breaker for them,” said Gustin. “Without the warranty, it's a lot harder to sell the tractor.”

Today, it’s added efficiency on the farm that often comes in the form of technology.

“I’m learning the difference between technology and applied technology,” said Howard.

Even for early adopters like the Howards, it can be hard to put all their confidence behind the technology at first, but from turning out four-bale cotton to 300 bushels per acre on their corn crop, pushing the envelope is paying off.

“You can't keep doing the same thing the same way and  expect different results,” said Howard. “We’ve got to be looking for the next step.”

The next step may still be unknown, but today's focus is producing even bigger yields and better profits.

“We're all driven by the desire to excel in what we do,” said Howard. “We're passionate about farming, we like it, we want to see what we can accomplish.”

“There's a lot of tools out there that even 10 years ago weren't available, so even though corn is $3.50, you can still squeeze over $4 out if you hit it at the right time,” said Frische.

The dark clouds of lower crop prices still hang over farmers’ heads, but 2017 is off to a solid start with moisture.

“A little brighter outlook for most of our farmers, even with the low prices, I think the optimism is still there,” said Gustin.

It’s that optimism that’s helping them also focus on a strong finish to 2017.

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McFarland, WI
5/30/2017 01:14 PM

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