Farmers are getting creative with their fleet management strategies and equipment purchasing behaviors in a world of tight farm economics. In addition, rising new and used equipment costs, the growing role of smart farming technology in purchase decisions and the dealer-farmer relationship come into play.
Here are three talking points to help keep your equipment fleet up to date in a down market from the farmers on stage at this year’s Moving Iron Summit, an annual Farm Journal event for used farm equipment dealers and auction companies.
Adopt a Second Buyer Approach
One effective strategy is shifting from a buy-new-at-all-costs mindset to a second buyer approach. Most combine harvesters remain operational for 15 to 18 years and have up to eight owners.
Illinois farmer Steve Pitstick and Iowa farmer Ben Riensche have found being the second buyer is the sweet spot for getting a good deal in the used market and still having a machine with modern precision ag technology. Riensche explains the mindset at play: When corn was trading at $6 a bushel, he says, it took 80,000 bu. to generate enough revenue to buy a nice used row crop tractor. Today, with $4 corn, that number has exploded to 140,000 bu. of corn to pay for the same used tractor.
“All those buyers are critical to that whole machine life,” Pitstick says. “I’ve chosen to be the second buyer. I come in at 300 hours, 400 hours and run it for a year. We flip machines every year with a 2-year-old or 1-year-old machine. Oftentimes it’s like a new machine to me because the first guy for some reason left the plastic on the seat.”
Keep a Backup for the Backup
The panel also agrees it pays to have a backup tractor or combine stashed in the machinery shed during spring planting and fall harvest, in case the tractor running the planter or the combine breaks down.
“We’ll keep our best old, used [machine] back in the back of the shed,” Riensche says. “If it gets used on that bluebird day when you really cut a lot of soybeans and it gets pulled out, or the day the front line combine goes down, we’ll pull it out because it obviously isn’t worth much on trade.”
Planter and Sprayer Tech Pays Off
When it comes to technology, Texas farmers Dale Allen and Todd Kimbrell, who both maintain relatively new equipment fleets, are seeing a return-on-investment when they take the time to figure out what works for their operations.
“First and foremost, for us it’s planters,” Kimbrell says. “Planter [tech] makes money in my part of the world, flat out. I can show you [data] all day long. It’s planter tech for us. Once we fixed our planters, our yields started going up. I’ll be honest, I don’t think we really knew how to plant until we put the technology on there.”
Allen is finding a lot of value in having his sprayers equipped with John Deere’s ExactApply application management system, which is available new from the factory and as an aftermarket retrofit kit on older machines. But John Deere’s hottest technology, it’s See & Spray smart spraying system, just doesn’t pencil out for his farm.
“There’s cost savings in being able to apply chemistry the way we need [it] applied,” Allen says. “What I’m trying to say is, not every technology fits on every farm. We got one shot to get it right, and we need to be sure.”
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