When Greg Peterson, founder of Machinery Pete, came on AgriTalk today, host Chip Flory opened up the discussion asking how the coronavirus pandemic was effecting the used machinery market.
Peterson, who has been tracking used machinery values for 30+ years said, “It's been 10 days unlike anything I've ever seen. It's just been amazing to watch the industry deal with the situation.”
Here are Peterson’s observations:
“I’ve seen unprecedented communication between auction companies about how they're handling the situation,” he said. “Honestly, I thought we would have seen mass cancellations and postponements, and we've seen a few, but sales are going on.”
That open communication has enabled auction companies to adopt online bidding faster and in direct response to the advisories banning large crowds. Peterson notes he’s seen the increasing trend to enabling online bidding, or online only events over the past 10 to 15 years, but nothing like this.
To help farmers adopt the online bidding even easier, auction companies have waived buyer’s premiums. “Farmers are under such pressure, so it’s greatly appreciated,” Peterson said. “It's been fascinating.”
Online events are here to stay. “I do think that one of the lasting effects in the US machinery market will be the move towards more straight online auctions,” Peterson said. “We've been going step by step that way for 10 to 12 years, but we're going to warp speed forward now.”
He’s encouraged how farm retirement sales are performing in light of current events. “The online method if done with extreme promotion in advance, through any and all means possible, it's working. And it's, it's fascinating to watch it unfold.”
Last note, Peterson continues to see good condition used equipment hold value, even bring some record prices. He says at the end of the day, what’s supporting those prices is that “good condition used is what farmers have got to have to get the job done.” He notes a record price at a sale in Illinois on Friday for a 2016 Case IH Magnum 240 CVT tractor. And there was the highest auction price since November 2014 in Minnesota for a 2013 model John Deere 8235R.
Listen to the full interview: