An uptick in used farm equipment auction activity recently leveled the playing field for buyers, but now auction prices are swinging the other way and stabilizing. Moving forward, dealers should be able to command solid value for low-hour, well-conditioned equipment.
The market shift is most likely the result of mounting uncertainty in the farm economy, says Casey Seymour. Corn prices are down 16¢ off the summer high ($4.06) and agronomic problems like tight tassel wrap, derecho-level wind storms in the Upper Midwest this week, and pollination issues are clouding corn price projections for the time being.
Related: Insights From Seed Companies on Tackling Tassel Wrap Challenges
Not to mention, used machinery inventories are down from last year, as well.
“There’s definitely been a change in the feel of how things are looking,” Seymour says. “Go out and check how many $700,000 combines are on the market at this time last year compared to how many are out there today. It’s like 90% of them aren’t there anymore.”
With less late-model, used equipment inventory out on the auction market overall, Machinery Pete believes prices are stabilizing and dealers might be able to regain footing over the next few months. A Merit Auctions online dealer consignment sale last Wednesday is a prime example.
“They sold a ’22 model (John Deere) S780, 428 engine hours that went for $342,500. For comparison the average auction price on a ‘22 model S780 this year was just over $299,000, and the highest (price) I’d seen this year was $350,000,” Pete says. “And on the red side, they had a (Case IH) ’22 model 8250 – a few more hours on it, 681 engine – that did $282,500. [The] average auction price on an 8250 this year was $263,000 and change.”
“You start seeing people at the auction market look at the dealer side and say: ‘Well, maybe that’s not such a bad deal after all,’ and we’re seeing that now,” Seymour says.
High Plains Region and Commodities Updates
Aaron Fintel, used equipment specialist with 21st Century Equipment and CEO of High Plains Wholesale, says we’re in the preharvest ramp-up period in the used equipment buying cycle. He says he is getting the most calls from buyers on used combines right now.
And Chip Nellinger, co-owner, Blue Reef Agri-Marketing, provides an update on the row crop commodities markets. He says heavy rains have increased yield projections and driven future prices lower, but he is also seeing a nice uptick in demand for corn exports and ethanol. Nellinger thinks the market is still sorting through tight tassel wrap and how that problem will impact prices heading into fall harvest.
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