Machinery Pete – aka Greg Peterson – does not anticipate a big shift in the used equipment auction world over the next 12 months.
He says used tractors, combines, sprayers and planters around the 10-year-old mark, in good condition with low hours – and not just the pre-def stuff, he adds – will continue holding strong, just as the segment did throughout 2024.
But late model equipment – used machines that are between one and five years old – are still in high supply on dealer lots, and because of that Peterson says there could be bargains to be had later in 2025.
Machinery Pete data shows high horsepower tractor (175 hp+) sales at auction increased a staggering 114% in 2024. Peterson expects that to continue in 2025. Equipment buyers with liquid cash flow at hand will be able to score some good deals on new-ish equipment in the back half of the year.
“Dealers are being super aggressive, because it’s tough paying 8% interest while it sits on the lot,” Peterson told AgriTalk host Chip Flory on Monday’s show. “They are trying to get out ahead and, frankly, taking some significant losses. And the manufacturers like John Deere and Case, you know, they’re all jumping in trying to help their dealers with this excess of late model used (equipment). So, I think for 2025, you know, it’s going to be year two (of that).”
Machinery Pete recalls a similar situation back in 2014, when that same late model, high horsepower tractor segment saw auction sales explode by 126%.
“And then, if we do this for another year or even two years, whatever it is, then whenever corn and bean (prices) go up, guess what’s going to happen? Everybody will be like ‘Oh, it’s been four years since I…I’ve got to update my planter now’,” Peterson explains. “The problem is everyone else is doing the same thing, so production will (need to) ramp up because we can only get so many.
“So, I think we’ll see what we also saw in ’21 and ’22, that’s what we’re setting up for,” he adds. “I’m not telling you to get your checkbook out, but I think when we get to the end of 2025, you’re going to have a great chance to buy some high, high quality used two- to five-year-old stuff.”
What about the new high horsepower farm equipment segment for 2025? Well, Machinery Pete isn’t feeling a lot of optimism there, yet. That’s because equipment dealers are still trying to get out from underneath the extensive used inventory sitting on their lots from last year.
“These dealers are…there’s fewer of them (today) and they’re huge,” Peterson says. “Their mindset is like nothing I’ve ever seen. They are like, ‘we are dealing with used, that’s what we’re about now’. And so much so that it’s pushed back to the manufacturer. These big dealers are semi dictating (to the manufacturers). Like, you know what? Yeah, we want to sell new, but we got to deal with this stuff that we’re paying 8% interest on now. And that’s something I have not ever seen before.”
Machinery Pete appears every Monday morning on AgriTalk Radio, so your best bet is staying tuned to those weekly segments to keep a finger on the pulse of the used equipment auction market.
Pete’s Pick of the Week
No Monday Machinery Pete segment would be complete without unveiling Pete’s Pick of the Week. Every week, Peterson highlights notable farm equipment auction results from around the country.
Pete’s Pick of the Week for this week comes to us from Burwell, Nebraska. The sale was handled by Adam Marshall Land and Auction (Kearney, Nebraska).
A 1979 International Harvester 986 tractor with 2,308 original hours sold for $23,250. That is the third highest auction price Machinery Pete has on record for that model.
Click on the link for a summary of auction results from MachineryPete.com for IH 986s over the years. The highest price all-time for that model is $52,500 from a sale in November 2021.
“My experience has been that 50 to 60 percent of the time, people actually buy these tractors to use them,” Peterson says. “And what you find is that people say ‘well, that was my favorite or my dad or my grandpa’s favorite tractor’ and here along comes one with 2,308 original hours. I mean, when are you going to find another one like it? if it makes you happy and you can take it out and do some field work with it, you can’t put a price tag on that.”
Upcoming Auctions to Watch
Machinery Pete says keep an eye on the online auction taking place Wednesday, January 22, over at Purple Wave Auctions. Keystone Cooperative – a huge farmer co-op with outlets in Indiana, Michigan, and Ohio, is auctioning off a large block of used sprayers and fertilizer spreaders. Check out this flyer for more info.
And Saturday, January 25, there is an Allstar Farms Auction sale by Iron Auction Group in Silver Creek, Georgia. Peterson says it will feature a good amount of trucks, trailers, and livestock equipment.
Check out the video preview from Machinery Pete below.
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